G.R. No. 253026 | December 6, 2023 |
Appraisers must understand that their professional duty extends beyond merely providing a valuation
Facts:
Aaron Christopher Mejia, an in-house appraiser for BPI Family Savings Bank, appraised a property for a housing loan application by Baby Irene Santos. He valued the property at ₱22.8 million. Based on this valuation, the bank approved a loan of ₱18.2 million. However, after default, the property was foreclosed and reappraised by third-party appraisers, who found the property’s true value to be between ₱8.6 to ₱10.3 million.
The significant overvaluation was attributed to Mejia’s representation that the house was a two-storey structure with 843.52 sqm of floor area, when in fact it was a split-type one-storey building with only around 265 sqm.
As a result, Mejia was charged and convicted by the RTC for violation of Section 55.1(d) of the General Banking Law of 2000 (R.A. 8791), which prohibits bank officers from overvaluing securities for the purpose of influencing bank action.
He appealed to the Court of Appeals, which affirmed the conviction but ruled that the offense was malum in se due to the presence of specific intent.
Issue: Whether Mejia is guilty of violating Section 55.1(d) of Republic Act No. 8791 (The General Banking Law of 2000) for overvaluing property with intent to influence the bank.
Yes, Mejia is guilty of violating Section 55.1(d) of Republic Act No. 8791 (The General Banking Law of 2000) for overvaluing property.
Section 55.1(d) of Republic Act No. 8791, also known as the General Banking Law of 2000, prohibits any director, officer, employee, or agent of a bank from overvaluing or aiding in overvaluing any security for the purpose of influencing in any way the actions of the bank or any bank.
In this case, the Court of Appeals did not simply infer intent from a mere difference in measurements. Instead, it considered several factors demonstrating specific intent. These included the gross discrepancy in valuation, where the petitioner’s measurements were more than triple those found in other appraisal reports. Furthermore, the petitioner’s characterization of the property as a two-storey building when it was not, despite his explanation about software limitations, revealed his awareness of the inaccuracy. Crucially, his failure to indicate in the remarks section that the building was a split-type or that the figures might not reflect actual measurements, despite knowing that his appraisal would directly affect the bank’s loan decision, strongly indicated a deliberate omission rather than mere inadvertence. These combined circumstances led to the conclusion that the petitioner harbored the specific intent to influence the bank’s actions through the overvaluation.
Therefore, the petitioner is found GUILTY beyond reasonable doubt of violation of Section 55.1(d) of the General Banking Law of 2000.
Appraisers must understand that their professional duty extends beyond merely providing a valuation; they bear a critical responsibility to ensure the absolute accuracy and complete disclosure of all material facts related to the property, especially its characteristics and the identity of its owner, as their reports directly influence significant financial and legal decisions, and any intent to mislead or gross negligence in disclosure can lead to severe criminal liability.
In simpler terms: Be meticulously accurate and transparent, always, because your report has real-world consequences, and intentionally misleading or grossly negligent appraisal can land you in jail.
Read the full text here. https://lawphil.net/judjuris/juri2023/dec2023/gr_253026_2023.html
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