Senate to open secret Estrada bank records

The Senate has ruled that it will open next week the controversial 'second envelope' which contained transactions made by Estrada in his secret account in the name of Jose Velarde at the Equitable PCI Bank even as prosecutors ordered nine banks to produce records of the deposit accounts of ousted Philippines leader Joseph Estrada involving up to $200 million.

Senate president Aquilino Pimentel said the contents of the envelope would be examined and placed on the Upper Chamber's records, after which it would be turned over to the Ombudsman, which is currently undergoing preliminary investigations on plunder cases filed by various crime watchdogs and private lawyers against Estrada.

"The most memorable event that happened in the 11th Congress is the impeachment trial, particularly the non-opening of the second envelope (about the Jose Velarde account)," said Pimentel. The account was used to launder money from gambling lords and for the purchase of lavish mansions for Estrada's mistresses.

Equitable PCI Bank voluntarily submitted two envelopes on the Jose Velarde account when compelled by the Senate impeachment trial body last December. But 11 senators outvoted their colleagues and prevented the prosecution from opening the second envelope of the Velarde account, resulting in the walk-out of the prosecution and the start of a four-day military-backed popular street protests which paved the way for the ouster of Estrada and the ascendance of Gloria Arroyo to the presidency on January 20.

In a related development, Ombudsman Aniano Desierto ordered nine local banks to produce records of the deposit accounts of Estrada involving the amount of $200 million. The banks covered by the subpoenas were Metropolitan Bank and Trust Co., Rizal Commercial Banking Corp., Bank of Commerce, Allied Bank, Security Bank and Trust Co., United Coconut Planters Bank, Asia United Bank and International Exchange Bank. Urban Bank, which is under receivership, was also included.

"I will now order the banks to submit to us the records of the bank accounts, if there's any in the bank. Legally they cannot refuse because that's within the authority of the ombudsman," said Disierto who also launched a criminal investigation to determine whether Estrada should be charged in court for plunder, corruption and related crimes.

The Philippines has a strict "bank secrecy" law and Central Bank Governor Rafael Buenaventura advised the banks named to consult their own lawyers. He said the secrecy law could not be applied if there is a court order on documents to aid government in pursuit of graft cases. "I guess the banks will have to seek their legal opinions whether they have to follow (Desierto's) order," Buenaventura said.

Meanwhile, Buenaventura is being accused of betraying public trust after he allowed the withdrawal of $15 million worth of retirement funds a day before the Urban Bank declared voluntary holiday, several congressmen said. Using a payee's name, BSP provident Fund of Central Bank instructed Urban Bank to issue three manager's check amounting to $100,000 (P5 million) each on April 24, 2000, a day before the Bank declared bank holiday, said Congressmen Joker Arroyo and Oskar Moreno.

The amount represented the retirement fund of the Central Bank employees, which was withdrawn ahead of its maturity in a high yielding account in which it was deposited at the Urban Bank, a 20-year-old middle-sized commercial bank which cited liquidity problem when it closed on April 25 last year. The new government of President Gloria Arroyo wants the bank accounts, along with a further $200 million in real estate, frozen and forfeited to the state on the grounds that they are ill-gotten wealth.