Non-disclosure of the bank deposits in one’s SALN constitutes dishonesty?

The pivotal issue in this case, however, is whether or not Racho’s non-disclosure of the bank deposits in his SALN constitutes dishonesty.

The Court views it in the affirmative.

          Section 7 and Section 8 of Republic Act (R.A.) 3019[38] explain the nature and importance of accomplishing a true, detailed and sworn SALN, thus:

Sec. 7.  Statement of Assets and Liabilities. — Every public officer, within thirty days after assuming office, and thereafter, on or before the fifteenth day of April following the close of every calendar year, as well as upon the expiration of his term of office, or upon his resignation or separation from office, shall prepare and file with the office of corresponding Department Head, or in the case of a Head Department or chief of an independent office, with the Office of the President, a true, detailed and sworn statement of the amounts and sources of his income, the amounts of his personal and family expenses and the amount of income taxes paid for the next preceding calendar year: Provided, That public officers assuming office less than two months before the end of the calendar year, may file their first statement on or before the fifteenth day of April following the close of said calendar year.

Sec. 8.  Prima Facie Evidence of and Dismissal Due to Unexplained Wealth. — If in accordance with the provisions of Republic Act Numbered One Thousand Three Hundred Seventy-Nine, a public official has been found to have acquired during his incumbency, whether in his name or in the name of other persons, an amount of property and/or money manifestly out of proportion to his salary and to his other lawful income, that fact shall be ground for dismissal or removal.  Properties in the name of the spouse and dependents of such public official may be taken into consideration, when their acquisition through legitimate means cannot be satisfactorily shown.  Bank deposits in the name of or manifestly excessive expenditures incurred by the public official, his spouse or any of their dependents including but not limited to activities in any club or association or any ostentatious display of wealth including frequent travel abroad of a non-official character by any public official when such activities entail expenses evidently out of proportion to legitimate income, shall likewise be taken into consideration in the enforcement of this Section, notwithstanding any provision of law to the contrary.  The circumstances hereinabove mentioned shall constitute valid ground for the administrative suspension of the public official concerned for an indefinite period until the investigation of the unexplained wealth is completed.

In the case of Carabeo v. Court of Appeals,[39] citing Ombudsman v. Valeroso,[40] the Court restated the rationale for the SALN and the evils that it seeks to thwart, to wit:

Section 8 above, speaks of unlawful acquisition of wealth, the evil sought to be suppressed and avoided, and Section 7, which mandates full disclosure of wealth in the SALN, is a means of preventing said evil and is aimed particularly at curtailing and minimizing, the opportunities for official corruption and maintaining a standard of honesty in the public service.  “Unexplained” matter normally results from “non-disclosure” or concealment of vital facts.  SALN, which all public officials and employees are mandated to file, are the means to achieve the policy of accountability of all public officers and employees in the government.  By the SALN, the public are able to monitor movement in the fortune of a public official; it is a valid check and balance mechanism to verify undisclosed properties and wealth.

Complimentary to the above-mentioned provisions, Section 2 of R.A. 1379[41] states that “whenever any public officer or employee has acquired during his incumbency an amount of property which is manifestly out of proportion to his salary as such public officer or employee and to his other lawful income and the income from legitimately acquired property, said property shall be presumed prima facie to have been unlawfully acquired.”

By mandate of law, every public official or government employee is required to make a complete disclosure of his assets, liabilities and net worth in order to suppress any questionable accumulation of wealth because the latter usually results from non-disclosure of such matters.  Hence, a public official or employee who has acquired money or property manifestly disproportionate to his salary or his other lawful income shall be prima facie presumed to have illegally acquired it.

It should be understood that what the law seeks to curtail is “acquisition of unexplained wealth.”  Where the source of the undisclosed wealth can be properly accounted, then it is “explained wealth” which the law does not penalize.

In this case, Racho not only failed to disclose his bank accounts containing substantial deposits but he also failed to satisfactorily explain the accumulation of his wealth or even identify the sources of such accumulated wealth.  The documents that Racho presented, like those purportedly showing that his brothers and nephew were financially capable of sending or contributing large amounts of money for their business,[42] do not prove that they did contribute or remit money for their supposed joint business venture.
Equally, the Special Power of Attorney[43] that was supposedly issued by Vieto, Dido and Henry Racho in favor of Racho onJanuary 28, 1993 to show their business plans, contained a glaringly inconsistent statement that belies the authenticity of the document, to wit:

1. To be the Trustee Attorney-in-fact of our investment in ANGELSONS LENDING AND INVESTORS, INC. of whom we are the Stockholders/Investors as well as the NAL PAY PHONE SERVICES, which was registered by the DTI last April 30, 1999 in the name of NIETO RACHO’s wife of whom we are likewise investors. [emphasis supplied]

          Definitely, a document that was allegedly executed in 1993 could not contain a statement referring to a future date “registered by the DTI last April 30, 1999.” This certainly renders the intrinsic and extrinsic value of the SPA questionable.

More important, the Joint Affidavits allegedly executed by Racho’s siblings and nephew to corroborate his story were later disowned and denied by his nephew, Henry, and brother, Vieto, as shown by their Counter-Affidavits.[44]  Henry averred that he was out of the country at the time of the alleged execution of the Joint Affidavit on December 18, 2004 and he arrived in Manila only on September 16, 2005.  Vieto, on the other hand, denied having signed the Joint Affidavit.  He disclosed that as a left-handed person, he pushes the pen instead of pulling it.  He concluded that the signature on the Joint Affidavit was made by a right-handed person.[45]  He likewise included a copy of his passport containing his real signature for comparison.[46]

Thus, the SPA and Joint Affidavits which should explain the sources of Racho’s wealth are dubious and merit no consideration.

Although Racho presented the SEC Certificate of Registration of Angelsons,[47] the business that he supposedly put up with his relatives, he showed no other document to confirm that the business is actually existing and operating. He likewise tried to show that his wife built a business of her own but he did not bother to explain how the business grew and merely presented a Certificate of Registration of Business Name from the DTI.[48]  These documents, however, do not prove that Racho had enough other sources of income to justify the said bank deposits. Ultimately, only P1,167,186.33[49] representing his wife’s retirement benefits, was properly accounted for.  Even this money, however, was reduced by his loan payable of P1,000,000.00 as reflected in his 2000 SALN.[50]

Dishonesty begins when an individual intentionally makes a false statement in any material fact, or practicing or attempting to practice any deception or fraud in order to secure his examination, registration, appointment or promotion.[51]  It is understood to imply the disposition to lie, cheat, deceive, or defraud; untrustworthiness; lack of integrity; lack of honesty, probity or integrity in principle; lack of fairness and straightforwardness; disposition to defraud, deceive or betray.[52]  It is a malevolent act that puts serious doubt upon one’s ability to perform his duties with the integrity and uprightness demanded of a public officer or employee.[53]  Section 52 (A)(1), Rule IV of the Revised Uniform Rules on Administrative Cases in Civil Service treats dishonesty as  a grave offense the penalty of which is dismissal from the service at the first infraction.[54]

          Indeed, an honest public servant will have no difficulty in gathering, collating and presenting evidence that will prove his credibility, but a dishonest one will only provide shallow excuses in his explanations.

For these reasons, the Court is of the view that Pleyto v. Philippine National Police (PNP)-Criminal Investigation and Detection Group (CIDG)[55] which the CA cited as basis to exculpate Racho of dishonesty, is not applicable in this case.  In the Pleyto case, the Court recognized Pleyto’s candid admission of his failure to properly and completely fill out his SALN, his vigorous effort to clarify the entries and provide the necessary information and supporting documents to show how he and his wife acquired their properties.[56]  The Court found substantial evidence that Pleyto and his wife had lawful sources of income other than Pleyto’s salary as a government official which allowed them to purchase several real properties in their names and travel abroad.[57]

Unfortunately for Racho, his situation is different.  The Court, thus, holds that the CA erred in finding him guilty of simple neglect of duty only.  As defined, simple neglect of duty is the failure to give proper attention to a task expected from an employee resulting from either carelessness or indifference.[58]  In this case, the discrepancies in the statement of Racho’s assets are not the results of mere carelessness.  On the contrary, there is substantial evidence pointing to a conclusion that Racho is guilty of dishonesty because of his unmistakable intent to cover up the true source of his questioned bank deposits.

It should be emphasized, however, that mere misdeclaration of the SALN does not automatically amount to dishonesty.  Only when the accumulated wealth becomes manifestly disproportionate to the employee’s income or other sources of income and the public officer/employee fails to properly account or explain his other sources of income, does he become susceptible to dishonesty because when a public officer takes an oath or office, he or she binds himself or herself to faithfully perform the duties of the office and use reasonable skill and diligence, and to act primarily for the benefit of the public.  Thus, in the discharge of duties, a public officer is to use that prudence, caution and attention which careful persons use in the management of their affairs.[59]

The Court has consistently reminded our public servants that public service demands utmost integrity and discipline. A public servant must display at all times the highest sense of honesty and integrity, for no less than the Constitution mandates the principle that a public office is a public trust; and all public officers and employees must at all times be accountable to the people and serve them with utmost responsibility, integrity, loyalty and efficiency.[60]


About Erineus

Born on December 28, 1965, Surallah, South Cotabato, Southern Mindanao, Philippines.
This entry was posted in Anti Graft and Corruption, Question and Answers, SAL-N, Uncategorized and tagged . Bookmark the permalink.

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