G.R. No. 239047 , June 16, 2021
Republic of the Philippines represented by the Anti-Money Laundering Council, Petitioner, vs. Juan T. Ng and Metropolitan Bank and Trust Company, Respondents.

FACTS

The Anti-Money Laundering Council (AMLC) initiated a civil forfeiture case against Juan T. Ng based on his alleged involvement in the Priority Development Assistance Fund (PDAF) scam orchestrated by Janet Lim Napoles. The AMLC’s investigation, prompted by sworn statements from JLN Corporation employees including Benhur Luy and Merlina Suñas, revealed that government funds were funneled through non-governmental organizations and diverted to Napoles’ accounts. The investigation further showed significant fund transfers from accounts linked to Senator Jinggoy Estrada to Ng’s Metrobank Account No. 3067507917 (the subject account), and that three checks from JLN Corporation/Napoles, totaling millions of pesos, were deposited into Ng’s account. The Republic, through AMLC, filed a Verified Petition for Civil Forfeiture before the Regional Trial Court (RTC), which issued a Provisional Asset Preservation Order (PAPO) ex parte. Ng moved to lift the PAPO, arguing he was never charged in the scam and that the funds were loan repayments from Napoles. The RTC denied the Republic’s prayer for an Asset Preservation Order and granted Ng’s motion to lift the PAPO, finding no clear evidence linking the funds in Ng’s account to the unlawful activity. The Court of Appeals affirmed the RTC’s orders, leading to the Republic’s Petition for Review before the Supreme Court.

ISSUE

Whether the Court of Appeals committed reversible error in affirming the RTC’s Orders which denied the issuance of an Asset Preservation Order and discharged the Provisional Asset Preservation Order against Juan T. Ng’s bank account.

RULING

The Supreme Court denied the petition and affirmed the assailed Court of Appeals Decision. The Court held that for civil forfeiture proceedings under Republic Act No. 9160 (Anti-Money Laundering Act), the petitioner must establish probable cause that the monetary instrument, property, or proceeds are related to an unlawful activity. The Court found that the Republic failed to establish the required probable cause. The evidence merely showed that three checks from Napoles or her entities were deposited into Ng’s account. The Republic did not sufficiently demonstrate that these specific funds were proceeds of the PDAF scam or that Ng, as the recipient, was aware of their illicit origin. The RTC’s finding that Ng was a legitimate businessman who extended loans to Napoles, and that the deposited checks were repayments for those loans, remained uncontroverted. Without proof that the specific funds in the account were themselves illicit, the Court could not authorize their preservation and forfeiture. The Court emphasized that the purpose of the provisional remedies under the law is to preserve property that is demonstrably related to unlawful activity, a link not sufficiently established in this case.