RCBC loses in damage suit vs Bangladesh central bank

THE Regional Trial Court (RTC) of Makati City has ordered the dismissal of the more than P100-million damage suit filed against the Bank of Bangladesh by the Rizal Commercial Banking Corp. (RCBC).

In a 9-page order, Makati City RTC Branch 142 Presiding Judge Rainald C. Paggao granted the motion for reconsideration filed by the Bangladesh central bank on October 28, 2021. The bank sought the reversal of the court’s orders issued on July 19, 2019, and October 18, 2021, which declared that summons was duly served against the Bank of Bangladesh through its executive head Hena Mohammad Razee Hasan. Hasan, however, refused to sign the summons when it was served on March 12, 2019, at Conrad Manila Hotel in Pasay.  

The trial court held that it has no jurisdiction over the Bangladesh Bank due to the lack of provisions in the Rules of Court for the service of summons to a foreign public corporation. 

It did not give weight to the argument that since the Bangko Sentral ng Pilipinas (BSP) is not immune from suits per its charter and, thus, the defendant Bangladesh Bank is also not immune from suit.  

“Such may be. Nevertheless service of summons is an entirely different matter and is based on express and specific provisions under the Rules of Court,” the order read. “In short, which certain domestic procedural processes may be jurally presumed to mirror foreign ones, the said principle cannot be validly applied successfully where the domestic procedural provision themselves do not provide for jural template that could be regarded with minor effect as to presume that they have their foreign counterparts.” 

“If our own rules do not provide for service of summons to foreign public corporations, then there is no processual presumption to apply in favor of herein plaintiffs and against herein defendants,” it added. 

The court also said RCBC’s notion that extraterritorial service of summons may be undertaken against Bangladesh Bank has no legal leg to stand on.  

Joining RCBC as plaintiff in the case was the bank’s National Sales Director Ismael S. Reyes who accused the Bangladeshi bank of maligning the reputation of RCBC when it called for a news conference to implicate the bank in the heist. 

The court noted that the rule on extraterritorial service of summons is provided for under Section 15 of the 1997 Rule of Civil Procedure and Section 17 of the 2019 Rules of Civil Procedure.  

It pointed out that based on the said provisions, it is not enough to allege that the defendant “does not reside and is not found in the Philippines” for the court to authorize the extraterritorial service of summons. 

The court said it must also be alleged that “the action affects the personal status of the plaintiff or relates to, or the subject of which is, property within the Philippines.”

The foregoing discussions inescapably lead to the conclusion that this court has no jurisdiction over the person of the defendant (Bangladesh Bank) , nor will it ever have within the limits of the provisions of the present rules as regards summons and the service thereof,” the court said. 

RCBC and the Bank of Bangladesh became entangled after $81 million from the latter reportedly landed in a number of Philippine accounts under the names of Michael Cruz ($6 million), Jessie Christopher Lagrosas ($30 million), Alfred Vergara ($20 million) and Enrico Vasquez ($25 million) despite stop-payment requests from the Bangladesh Bank.  

In 2021, the Bangladesh Bank also filed a complaint before the Supreme Court of New York in connection with the incident.  

The Department of Justice has also filed anti-money laundering charges against five executives of RCBC in connection with the heist.  

Prosecutors cited the “willful blindness doctrine” as “the deliberate avoidance or knowledge of a crime, especially by failing to make a reasonable inquiry about suspected wrongdoing, despite being aware that it is highly probable” in filing the complaint.

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