LandBank nixes BIR control of Makati bank accounts

MANILA, Philippines - Makati Mayor Jejomar Binay said the other day that the LandBank of the Philippines has rejected the warrant of garnishment issued by the Bureau of Internal Revenue against the bank accounts of the city government.

Binay said a letter was sent by LBP assistant vice president Rosemarie Oseteo to BIR chief Joel Tan-Torres informing the latter that court decisions prohibit garnishment of public funds. “In view of the foregoing, LandBank is left with no other recourse but to comply with substantive and jurisprudential laws prohibiting garnishment of public funds,” Oseteo said.

Binay said the BIR issued on April 8 a warrant of garnishment on Makati’s bank account with the LandBank without informing the city government. “That the BIR would garnish our bank account on the sly, without even giving us a copy of the warrant, proves that the motive is not to collect but to harass the opposition,” Binay said. 

He said the city government only learned about the April 8 garnishment order through the LandBank. “It was a sneak attack that failed,” Binay said.

Binay recalled that the BIR had said it was no longer issuing a warrant of garnishment on the city’s funds and instead issued a levy on the Makati City Hall. It also threatened to seize government vehicles. “You can see the insincerity, the bad faith, and the double talk. They tell the public and the media that they will not issue a garnishment order, yet on the same day that they served the levy on City Hall, they issued a warrant of garnishment to the LandBank,” Binay said.

He said the April 8 garnishment order covered the amount of P1,146,883,846.08 deposited with LandBank, which is the city’s depository bank. He said the Land Bank, however, cited circulars from the Commission on Audit (COA) and Supreme Court decision prohibiting garnishment of public funds.

“Please note that per COA Circular No. 2001-002, ‘all money claims against the government must first be filed with the COA which must act upon it within 60 days. Rejection of the claim will authorize the claimant to elevate the matter to the Supreme Court on certiorari and in effect sue the State thereby,’” the bank said. The LandBank also cited the decision of the Supreme Court in the case of Municipality of Makati vs. Court of Appeals.