The Court of Appeals (CA) denied the appeal of former bank officers of the closed Jade Progressive Savings and Mortgage Bank (Jade Bank) and affirmed the conviction rendered by the Regional Trial Court (RTC) of Manila Branch 15 for estafa.

In its Decision dated December 22, 2015, the CA not only denied the appeal of Luis L. Co and his son Alvin Milton Co, former Jade Bank President and Assistant Vice President, respectively, but also increased the penalty imposed by the RTC, sentencing them to a maximum of 20 years' imprisonment. The CA also ordered the accused to indemnify Jade Bank in the amount of PHP3,032,909.00 plus legal interests, reckoned from the filing of the complaint until fully paid, plus costs.

The Appellate Court declared that the RTC proved beyond reasonable doubt that the accused "misrepresented and falsely pretended that Acme rendered services to Jade Bank requiring payment thereof."

The Manila RTC in its February 11, 2013 Decision in Criminal Case No. 03-211251, imposed against the accused the penalty of imprisonment of up to 14 years, eight months and one day and indemnification in the same amount to the bank.

The accused were charged with estafa for defrauding the bank by authorizing the release of PHP3,032,909.00 from the bank's funds to pay Acme Investigation Services, Inc., a fictitious agency not registered with the Securities and Exchange Commission, the Philippine National Police's Guards Supervision Division, and the Philippine Association of Detective and Protective Agency Operators, Inc. (PADPAO). Investigations showed that the check payments to Acme were deposited in bank accounts owned and controlled by the accused.

The Monetary Board ordered the closure of Jade Bank and placed it under receivership of the Philippine Deposit Insurance Corporation (PDIC) in December 2000. The estafa case was filed by the PDIC, the liquidator of Jade Bank.

The filing of charges against erring bank officers and employees and unscrupulous individuals is an important undertaking of the PDIC to achieve the twin objectives of deterring other parties from taking advantage of the deposit insurance system, and at the same time protect the interests of the depositors and the Deposit Insurance Fund, PDIC's funding source for payment of deposit insurance.

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The Philippine Deposit Insurance Corporation (PDIC) was established on June 22, 1963 by Republic Act 3591 to provide depositor protection and help maintain stability in the financial system by providing permanent and continuing deposit insurance. Effective June 1, 2009, the maximum deposit insurance coverage is P500,000 per depositor. All deposit accounts by a depositor in a closed bank maintained in the same right and capacity shall be added together. A joint account shall be insured separately from any individually-owned deposit account.

PDIC news/press releases and other information are available at the website, www.pdic.gov.ph.