[Answer/discuss the question below, or see 2017 bar exam Mercantile Law Instructions; Also check the other 2017 Mercantile Law Questions:1, 2, 3, 4, 5, 6, 7, 9, 10, 11, and 12; See also 2017 Bar Exam: Information, Discussions, Tips, Questions and Results]
Flora, a frequent traveller, found a purse concealed between the cushions of a large sofa inside the VIP lounge in NAIA while she was waiting for her flight to be called. Inside the purse was a very valuable diamond-studded necklace. She decided not to turn over the purse to the airport management, and instead to keep it. On her return from her travels, she had a dependable jeweller appraise the necklace, and the latter told her that the necklace was easily worth at least PS,000,000.00 in the open market. To test the appraisal, she pawned the necklace for P2,000,000.00. She then deposited the entire amount in her checking account with Metro Bank. Promptly, Metro Bank reported the transaction to the Anti-Money Laundering Council (AMLC).
Given that her appropriation of the necklace was theft, may Flora be successfully prosecuted for money laundering? Explain briefly your answer. (4%)
Prosperous Bank is a domestic bank with head office in Makati. It handles the banking requirements of thousands of clients.
The AMLC initiated a discreet investigation of the financial transactions of Lorenzo, a suspected drug trafficker based in Naga City. The intelligence group of the AMLC, in coordination with the counterpart group from the PDEA and the NBI, gathered ample evidence establishing Lorenzo’s unlawful drug activities. The AMLC had probable cause that his deposits and investments in various banks, including Prosperous Bank, were related to money laundering.
Accordingly, the AMLC now transmits to Prosperous Bank a formal demand to allow its agents to examine the banking transactions of Lorenzo, but Prosperous Bank refuses the demand.
Is Prosperous Bank’s refusal justified? Explain your answer. (4%)