Over ₱1.6 billion in unpaid teacher loan collections are filed by AMA Bank against DepEd in criminal charges

Alleging that the Department of Education (DepEd) and some officials unlawfully withheld more than ₱1.6 billion in loan repayments collected from public school teachers, AMA Rural Bank of Mandaluyong (ARB) has filed a criminal complaint against them with the Office of the Ombudsman.  Prior to this, ARB, a lending organization with DepEd accreditation, offered these loans.

Named as respondents in the ARB complaint were Usec. for Finance Annalyn M. Sevilla, Asec. for Finance Edson Byron K. Sy, Usec. for Legal and Legislative Affairs Filemon Ray L. Javier, and Chief Administrative Officer Cholita F. Tiong. 

According to ARB, DepEd admitted to receiving at least ₱1.015 billion by the end of 2024 after a protracted accounting reconciliation process, with an additional ₱676 million still under scrutiny.  DepEd hasn't sent the funds to ARB, meanwhile, claiming that there are still unresolved legal matters related to the BSP's illegal shutdown of ARB in November 2019.  ARB contends that the Supreme Court and the Court of Appeals have already decided these instances in its favor.

ARB claims that DepEd breaches the Anti-Graft and Corrupt Practices Act by refusing to transfer the money, even after subtracting its 1% service fee.  The bank also asserts that since DepEd was not involved in the BSP-related proceedings and the court decisions in favor of ARB are already final and executory, DepEd cannot use them as a justification for withholding making payments.

The complaint raises more general issues with DepEd's management of payroll remittances and deductions.  According to a 2024 report by the Commission on Audit (COA), DepEd neglected to send ₱3.1 billion in loan installments and GSIS contributions.  COA discovered that DepEd had also neglected to pay ₱5.55 billion in taxes, insurance premiums, and loan payments that were withheld from both teaching and non-teaching employees a year prior.  Recently, DepEd was also embroiled in a controversy about the dubious purchase of antiquated and expensive laptops.

According to ARB, the case is a part of its efforts to recoup assets, compensate depositors, and hold public authorities responsible for mismanaging the bank's finances during the illegal closure that was ordered by the BSP.

After receiving conflicting statements regarding reopening and depositor payments, AMA Bank requests clarification from the BSP

In response to the January 30, 2025, press release from the Bangko Sentral ng Pilipinas (BSP) titled "Statement on AMA Bank Case," AMA Rural Bank of Mandaluyong, Inc. (AMA Bank) requested clarification on the BSP's stance on the bank's reopening and its pending Motion for Reconsideration with the Supreme Court.

In contrast to BSP's own legal filings with the Court of Appeals and the Supreme Court, AMA Bank notes that the BSP's statement claimed that its pending second Motion for Reconsideration “does not prevent AMA Bank from reopening and paying its depositors and creditors.” 

BSP previously contended in its Comment/Opposition submitted to the Court of Appeals that the Supreme Court's pending second Motion for Reconsideration precluded the execution of AMA Bank's Motion for Execution. In addition, BSP claimed in its second Motion for Reconsideration submitted to the Supreme Court that AMA Bank could not be reopened in any way following its closure.

AMA Bank is now formally asking BSP to clarify whether it has given up on its second Motion for Reconsideration with the Supreme Court and its Comment/Opposition to AMA Bank's Motion for Execution with the Court of Appeals, given the apparent discrepancy between BSP's press release and its legal arguments. AMA Bank requests that the BSP formally withdraw these filings if it no longer supports them.

In accordance with the Supreme Court's and the Court of Appeals' final rulings, AMA Bank also wants to know if the BSP press release should be regarded as an official approval for the bank's reopening. If so, AMA Bank asks that the BSP provide written confirmation of this.

To facilitate the bank’s reopening for the sole and limited purpose of repaying its long-suffering depositors, AMA Bank is calling on BSP to take the following actions without further delay:

• Return AMA Bank’s reserve funds amounting to approximately Php135 million;
• Instruct the Philippine Deposit Insurance Corporation (PDIC) to return the bank’s cash assets totaling approximately Php340 million, which were seized under BSP’s now-nullified closure order;
• Advise the Department of Education (DepEd) to promptly release collections from teacher’s loans owed to AMA Bank, amounting to more than Php1.4 billion.

In the interest of its creditors and depositors, who have suffered through extended uncertainty as a result of the bank's closure, AMA Bank reaffirms its dedication to finding a solution to this issue. The bank calls on the BSP to take prompt, sincere action to restore its clients' financial stability and guarantee adherence to court orders.