Standard Chartered Bank (Philippine Branch) vs.

Senate Committee
on Banks, Financial Institutions and Currencies

FACTS:

Petitioner, Standard Chartered Bank, is an institution incorporated in England with limited

liability licensed to engage in banking, trust, and other related operations in the country. It
violated RA 87991 for selling unregistered foreign securities. Senator Enrile2 in his privilege
speech introduced a Resolution3 to attend to the matter. The respondent-committee’s
chairperson Sen. Angara set an initial hearing to investigate in aid of legislation thereto.

Respondent invited petitioners to attend the hearing and submit their written position
paper. Petitioners, in response, submitted to respondent a letter stressing their position that
there were cases already pending in court which involved the same issues that the respondent is
subjecting to legislative inquiry. The petitioner thereby poses a challenge to the jurisdiction of
respondent committee to continue the inquiry since there are cases of a similar subject filed in
court of which are still pending.

Respondent still commenced the investigation. Its vice chairperson moved for the issuance
of a subpoena to those who did not attend the hearing.4 Said motion was approved thereby the
cause of a petition. Standard Chartered Bank, petitioned for a TRO to direct the Senate
Committee on Banks from:

1. Proceeding with its inquiry pursuant to a Senate Resolution5

2. Compelling the Bank’s officers to attend and testify before any further hearing called by
the respondent Committee

3. Enforcing any Hold-departure order (HDO) and/or putting the petitioners on the Watch list

Petitioner-Bank also prays that judgment be rendered annulling the subpoena ad testificandum6
and duces tecum 7issued to them and prohibit the Committee from compelling them to appear
and testify in the inquiry being conducted pursuant to the Resolution.

ISSUE(S):

Whether or not respondent committee acted without jurisdiction and/or acted with grave
abuse of discretion amounting to lack of jurisdiction, purportedly in aid of legislation

1
Securities and Regulation Code.
2
He is the Vice Chairperson of herein respondent.
3
Resolution directs the Senate Committee on Banks to conduct an inquiry, in aid of legislation, into the
illegal sale of unregistered and high-risk securities by petitioner-bank which resulted in billions of pesos of
losses to the investing public
4
The Senate request the DOJ, through the Bureau of Immigration and Deportation, to issue a Hold-
departure order (HDO) AGAINST THEM AND/OR INCLUDE THEM IN THE Bureau’s Watch list.
5
Said Resolution directs the Senate Committee on Banks to conduct an inquiry, in aid of legislation, into
the illegal sale of unregistered and high-risk securities by petitioner-bank which resulted in billions of
pesos of losses to the investing public
6
A court summons to appear and give oral testimony for use at a hearing or trial.
7
A court summons ordering a named party to appear before the court and produce documents or other
tangible evidence for use at a hearing or trial.
HELD:

Petition for prohibition DENIED.

RATIO/DOCTRINE:

Respondent has jurisdiction to conduct the inquiry although the subject matter involved is
the very same subject matter pending in court. The respondent-committee’s action does not
encroach upon the judicial powers vested solely on the courts. The petitioner’s reliance to the
Bengzon8 case is misplaced to the extent that, in the case at bar, there are a number of cases
already pending in various courts and administrative bodies involving the petitioners, relative to
the alleged sale of unregistered foreign securities, there is a resemblance between this case and
Bengzon. However, the similarity ends there.

Central to the Court’s ruling in Bengzon was the court’s determination that the intended
inquiry was not in aid of legislation. The petitioners erred in alleging that the inquiry was simply
to denounce the illegal practice committed by a foreign bank in selling unregistered foreign
securities. This fallacy is made more glaring at the conclusion of Sen. Enrile’s privilege speech
urging the Senate “to immediately conduct an inquiry, in aid of legislation, so as to prevent the
occurrence of a similar fraudulent activity in the future.”

Indeed, the mere filing of a criminal or an administrative complaint before a court or a

quasi-judicial body should not automatically bar the conduct of legislative investigation.
Otherwise, it would be extremely easy to subvert any intended inquiry by Congress through the
convenient ploy of instituting a criminal or an administrative complaint. Surely, the exercise of
sovereign legislative authority, of which the power of legislative inquiry is an essential
component, cannot be made subordinate to a criminal or an administrative investigation.

8
In this case the Court declared that the issue to be investigated was one over which jurisdiction had
already been acquired by the Sandiganbayan, and to allow the Senate Blue Ribbon Committee to
investigate the matter create the possibility of conflicting judgments; and that the inquiry into the same
justiciable controversy would be an encroachment on the exclusive domain of judicial jurisdiction.