Bank Secrecy Law

Question 1

What are the two purposes of the Bank Secrecy Law?

Answer 1

• To discourage private hoarding
• To give encouragement to the people to deposit their money in banking institutions.

Question 2

What will happen to any violation of the Law on Secrecy of Bank Deposits?

Answer 2

Section 5 of the RA states that violators will be subject to “conviction, to an
imprisonment of not more than five years or a fine of not more than P20,000, or both, in
the discretion of the court.”

Question 3

What accounts are covered in the secrecy law?

Answer 3

Savings accounts, checking accounts, and other types of bank deposits are included in
the secrecy law. Money markets, trust funds, mutual funds, and the like are not
covered.

Question 4

What are the four instances under the law where a bank deposits or investment in government
bonds may be disclosed or looked into by an official or employee of any banking institutions?

Answer 4

• Upon written permission of the depositor
• In cases of impeachment
• Upon order of the competent court in cases of bribery or dereliction of duty of public
  officials
• In cases where the money deposited or invested is the subject matter of the litigation

Question 5

It shall be unlawful for any ________ or ________ of a banking institution to disclose to any
person any information concerning said deposits.

Answer 5

• official
• employee