Matalam vs. People of the Philippines

The head of a government office or agency is criminally liable for non-remittance of the employer's share of GSIS and Pag-IBIG Fund premiums under Section 52(g) of R.A. No. 8291 and Section 1, Rule XIII of the IRR of R.A. No. 7742, the offense being malum prohibitum where criminal intent is immaterial and only the voluntary commission of the prohibited act need be shown.

Matalam served as Regional Secretary of the Department of Agrarian Reform-Autonomous Region for Muslim Mindanao (DAR-ARMM) from January 1997 to 1998, concurrently holding the position of Vice-Governor of the ARMM Region. As head of the Regional Office, he oversaw multiple divisions and offices, including the Administrative and Finance Division, Provincial Agrarian Reform Offices, and Municipal Agrarian Reform Offices. The GSIS was created to provide social security and insurance benefits to government employees, funded by both member and employer contributions, with the State adopting a policy of maintaining actuarial solvency of GSIS funds at all times. The Pag-IBIG Fund was established pursuant to constitutional mandates on the promotion of public welfare through social services, particularly the working groups' need for decent shelter, with mandatory contributory support from employers. Both systems require timely remittance of employer contributions to preserve their actuarial solvency and fulfill their social justice objectives.

Matalam was the Regional Secretary of DAR-ARMM from January 1997 to 1998, concurrently serving as Vice-Governor of the ARMM Region. As head of the Regional Office, he oversaw several offices, including the Office of the Assistant Regional Secretary, the Administrative and Finance Division, the Operation Division, the Planning Division, the Legal Division, Support Services, Provincial Agrarian Reform Offices, and Municipal Agrarian Reform Offices. His co-accused, Ansarry Lawi and Naimah B. Unte, served as Cashier and Accountant, respectively, of the same government office.

The Office of the Ombudsman charged Matalam, Lawi, and Unte with non-remittance of the employer's share of GSIS premiums amounting to ₱2,418,577.33 for the period January 1997 to June 1998 under Section 52(g) of R.A. No. 8291, and non-remittance of the employer's share of Pag-IBIG Fund premiums amounting to ₱149,100.00 for the same period under Section 1, Rule XIII of the IRR of R.A. No. 7742. On August 11, 2003, Matalam was arraigned and pleaded not guilty; on October 20, 2004, Lawi and Unte were arraigned and separately pleaded not guilty. The prosecution presented five witnesses, including Lilia Gamut-gamutan Delangalen (Accountant III of GSIS Cotabato Branch), Rolando Roque (Chief of Division, Member Services Division of Pag-IBIG Fund Cotabato Branch), Husain Enden Matanog (State Auditor III of the Office of the Auditor and Resident of DAR-ARMM), Luz Cantor-Malbog (Director of Bureau C, Department of Budget and Management), and Abdulkadil Angas Alabat (Department Manager, Land Bank of the Philippines Cotabato Branch).

On July 17, 1998, Zenaida D. Ferrer, GSIS Officer-in-Charge, sent a Notice of Underpayment to Matalam informing him that the office's Premium Master List as of December 31, 1997 showed understated remittances for compulsory GSIS premiums covering January 1997 to June 1998. Six Statements of Account of Compulsory Contributions Due and Payable as of June 30, 1998 were attached, all addressed to Matalam. Letters from the Pag-IBIG Fund's Chief of the Member Services Division directing remittance of the employer's share were addressed to the Head of Office of the DAR Provincial Office in Maguindanao. The Department of Budget and Management released the funds to DAR-ARMM through corresponding Advice of Notice of Cash Allocation. These funds were credited to the account of the Office of the Regional Governor of the ARMM, which had the obligation to remit to the various line agencies the specific amounts provided to them. Based on the testimony of Alabat, amounts were deposited into Account No. 0372-1054-29 maintained by DAR-ARMM for its Fund 101.

Matalam presented a Fourth Indorsement dated April 30, 1998, addressed to Lawi and signed by Atty. Tommy A. Ala, then Matalam's Chief of Staff, directing Lawi to comment or act on the Third Indorsement of State Auditor Husain Matanog. Matalam also presented other memoranda directing Unte and Lawi to respond to the complaints. When asked why he did not sanction Lawi and Unte upon their failure to comply with his directives, Matalam said he did not have time due to numerous pending tasks. Lawi and Unte failed to present evidence despite the opportunities given them. The Sandiganbayan found that the funds were indeed deposited into DAR-ARMM's bank account, triggering Matalam's duty to ensure remittance, and held that as the highest official of DAR-Maguindanao, Matalam fell under the first category of responsible officials under the law, while his co-accused fell under the second category.

• Reasonable Doubt: Petitioner argued that a review of the factual findings of the Sandiganbayan would reveal reasonable doubt that he committed the crimes imputed to him.
• Funds Not Released to DAR-ARMM: Petitioner maintained that testimonies of the witnesses showed the funds for remittances due to GSIS and Pag-IBIG Fund were released to the Office of the Regional Governor of the ARMM and not to DAR-ARMM, and that it was the Office of the Regional Governor that had the duty to release the funds.
• Ministerial Duty as Signatory: Petitioner argued that as Regional Secretary, he could not be held accountable for non-payment or remittance, since as a matter of procedure he merely acted as a signatory to whatever document was necessary for payment, and his duty to affix his signature was only ministerial, conditioned on his receipt of disbursement vouchers prepared by the accountant and checked by the cashier.
• Due Diligence: Petitioner claimed he was not negligent in reminding his co-accused to respond to complaints regarding non-remittance, having sent four memoranda addressed to Lawi and Unte directing them to respond to the complaints and to the letter of State Auditor Husain Matanog.
• Billing Statements Not Addressed to Him: Petitioner argued that the billing statements were not addressed to him but were sent to the Accounting Division of DAR, and hence it should have been Unte's duty as accountant to deal with the statements or bring them to Matalam's attention.
• Incomplete Evidence: Petitioner assailed the testimony of witness Abdulkadil Alabat for being incomplete, arguing that not all bank statements allegedly related to ARMM's account with Land Bank of the Philippines were presented in court, and that Notices of Cash Allocation were addressed to the Office of the Regional Governor of the ARMM, not to DAR-ARMM.
• Burden of Proof in Malum Prohibitum: Petitioner argued that even if the offenses are mala prohibita, his guilt must still be proven beyond reasonable doubt, and that the pieces of evidence presented created reasonable doubt as to his guilt, warranting a re-evaluation of the evidence.

• Criminal Liability of Head of Office: Whether petitioner Datu Guimid P. Matalam is guilty beyond reasonable doubt of non-remittance of the employer's share of GSIS and Pag-IBIG Fund premiums as head of DAR-ARMM.
• Nature of the Offense and Required Proof: Whether the non-remittance of GSIS and Pag-IBIG Fund premiums constitutes malum prohibitum such that criminal intent is immaterial, and whether petitioner's guilt was nevertheless proven beyond reasonable doubt.
• Propriety of Modified Penalties: Whether the penalties imposed by the Sandiganbayan should be modified in light of petitioner's position and conduct.

• Criminal Liability of Head of Office: Yes. Section 52(g) of R.A. No. 8291 expressly provides that heads of offices of the national government and its agencies who fail, refuse, or delay the remittance of accounts due the GSIS within thirty days from when due and demandable shall suffer criminal penalties. Similarly, under Section 1, Rule XIII of the IRR of R.A. No. 7742, the employer—defined to include the government and its agencies—is liable for failure to remit Pag-IBIG Fund contributions.
• Nature of the Offense and Required Proof: The offenses are malum prohibitum. The relevant laws punish the failure, refusal, or delay without lawful or justifiable cause in remitting the required contributions; criminal intent is immaterial, and only the voluntary commission of the prohibited act need be shown. Petitioner's guilt was established beyond reasonable doubt, the Sandiganbayan's factual findings that funds were deposited into DAR-ARMM's account being entitled to respect and finality.
• Propriety of Modified Penalties: Yes, the penalties were properly modified upward. Considering petitioner's position as head of the agency and his conduct of attempting to pass blame to his co-accused, the Indeterminate Sentence Law's goal of individualizing penalties warranted increased imprisonment terms and an increased fine.

• Criminal Liability of Head of Office: Section 52(g) of R.A. No. 8291 expressly designates heads of offices of the national government, its political subdivisions, branches, agencies, and instrumentalities as criminally liable for failure, refusal, or delay in the payment, turnover, remittance, or delivery of accounts due the GSIS within thirty days from when due and demandable. Petitioner was admittedly the DAR-ARMM Secretary from January 1997 to 1998 and the highest official of DAR-Maguindanao, placing him under the first category of responsible officials. His defense shifting the duty to remit to co-accused Lawi and Unte was unavailing, as those officials fell under the second category. Similarly, under the IRR of R.A. No. 7742, the term "employer" includes the government, its national and local offices, political subdivisions, branches, agencies, or instrumentalities, and the Sandiganbayan correctly ruled that it is the head of the office or agency that has the obligation to remit. The letters from Pag-IBIG Fund's Chief of the Member Services Division directing remittance were addressed to the Head of Office of the DAR Provincial Office, bolstering the correct application of the law. Petitioner's argument that funds were not directly credited to DAR-ARMM but to the Office of the Regional Governor was rejected, as the Sandiganbayan found from testimonies and evidence that the amounts were indeed deposited into the bank account maintained by DAR-ARMM for its Fund 101. The duty to ensure remittance was thus triggered by the availability of funds in DAR-ARMM's account. Factual findings of the trial court are entitled to respect and finality unless patently misplaced or without basis, and petitioner failed to show such exception.

• Nature of the Offense and Required Proof: Non-remittance of GSIS and Pag-IBIG Fund premiums is malum prohibitum. Acts punished under special laws are generally malum prohibitum, where malice or criminal intent is completely immaterial. What the relevant laws punish is the failure, refusal, or delay without lawful or justifiable cause in remitting or paying the required contributions. The distinction between mala in se and mala prohibita was discussed: crimes mala in se presuppose criminal intent (mens rea), while crimes mala prohibita do not require knowledge or criminal intent unless the statute uses words like "knowingly" and "willfully." Volition or intent to commit the act is different from criminal intent; when an act is prohibited by a special law, the performance of the prohibited act is the crime itself. In Saguin vs. People, non-remittance of Pag-IBIG Fund premiums without lawful cause was held punishable, though the petitioners there were justified due to confusion arising from devolution. In this case, petitioner failed to prove a justifiable cause for non-remittance. He was informed of the underpayment for a period of one year and six months and failed to heed the letters and billing statements asking him, as head of DAR-ARMM, to pay the deficiencies. Even if the offenses are mala prohibita, the evidence established guilt beyond reasonable doubt.

• Propriety of Modified Penalties: Under the Indeterminate Sentence Law, the basic goal is to uplift and redeem valuable human material and prevent unnecessary deprivation of liberty, while penalties should be fitted to the individual with due regard for protecting the social order. Factors to be considered include the criminal's age, health, mentality, previous conduct, education, proclivities, demeanor during trial, manner and circumstances of the crime, and gravity of the offense, as well as his relationship toward dependents, family, society, and the State. In Rios vs. Sandiganbayan, the Court underscored the constitutional principle that public office is a public trust, requiring public officers to serve with utmost responsibility, integrity, loyalty, and efficiency. Considering petitioner's position as head of the agency and his actions of trying to pass the blame to his co-accused, the sentence was modified: in Criminal Case No. 26707, imprisonment was increased to a minimum of three years to a maximum of five years; in Criminal Case No. 26708, imprisonment of three to six years was imposed in addition to the fine, which was increased to ₱250,000.00.

• Malum Prohibitum — An act declared malum prohibitum is one where malice or criminal intent is completely immaterial; the commission of the prohibited act as defined by law, not the character or effect thereof, determines whether the provision has been violated. Volition or intent to commit the act is different from criminal intent—when an act is prohibited by a special law, it is considered injurious to public welfare, and the performance of the prohibited act is the crime itself. The Court applied this doctrine to hold that non-remittance of GSIS and Pag-IBIG Fund premiums, being offenses under special laws, requires no proof of criminal intent; only the voluntary commission of the prohibited act—failure, refusal, or delay in remitting contributions without justifiable cause—need be established.

• Public Office is a Public Trust — Public officers and employees must at all times be accountable to the people, serve them with utmost responsibility, integrity, loyalty and efficiency, act with patriotism and justice, and lead modest lives. The Court invoked this constitutional principle to emphasize the heightened duty of petitioner as head of a government agency to ensure proper remittance of employer contributions, and to justify the modification of penalties upward given his position and conduct.

• Respect and Finality of Trial Court Factual Findings — Factual findings of the trial court are entitled to respect and finality unless it is shown that such findings are patently misplaced or without any basis. The Court applied this doctrine to uphold the Sandiganbayan's finding that funds were deposited into DAR-ARMM's bank account, thereby triggering petitioner's duty to ensure remittance.

• Individualization of Penalties Under the Indeterminate Sentence Law — The Indeterminate Sentence Law aims to uplift and redeem valuable human material and prevent unnecessary deprivation of liberty, while penalties should be fitted to the individual with due regard for protecting the social order. Factors include the criminal's age, health, mentality, previous conduct, education, proclivities, demeanor during trial, manner and circumstances of the crime, gravity of the offense, and relationship toward family, society, and the State. The Court applied these factors to modify the penalties upward, considering petitioner's high position and his attempt to shift blame to co-accused.

• "When an act is prohibited by a special law, it is considered injurious to public welfare, and the performance of the prohibited act is the crime itself." — This passage articulates the core ratio decidendi for treating non-remittance of premiums as malum prohibitum, establishing that criminal intent is immaterial and only the commission of the prohibited act need be shown.

• "What the relevant laws punish is the failure, refusal, or delay without lawful or justifiable cause in remitting or paying the required contributions or accounts." — This defines the precise scope of the penal provisions governing GSIS and Pag-IBIG Fund remittances, clarifying that the offense is complete upon failure to remit without justifiable cause.

• "Public office is a public trust. Public officers and employees must at all times be accountable to the people, serve them with utmost responsibility, integrity, loyalty and efficiency, act with patriotism and justice, and lead modest lives." — This quotation, drawn from Rios vs. Sandiganbayan, underscores the constitutional standard expected of public officers and was relied upon to emphasize the heightened responsibility of agency heads and to justify the modified penalties.

• ABS-CBN Corp. vs. Gozon, G.R. No. 195956, March 11, 2015 — Followed for its discussion distinguishing acts mala prohibita from mala in se, including the principle that criminal intent is immaterial in mala prohibita and that volition is different from criminal intent. The Court applied this framework to classify non-remittance of premiums as malum prohibitum.

• Saguin vs. People, G.R. No. 210603, November 25, 2015 — Followed and distinguished. The Court cited Saguin for the proposition that non-remittance of Pag-IBIG Fund premiums without lawful cause is punishable under the penal clause of P.D. No. 1752. However, Saguin was distinguished because the petitioners there were justified in not remitting on time due to confusion arising from the devolution of their hospital to the provincial government, whereas petitioner here failed to prove any justifiable cause.

• Rios vs. Sandiganbayan, 345 Phil. 85 (1997) — Followed for the constitutional principle that public office is a public trust, requiring public officers to serve with utmost responsibility, integrity, loyalty, and efficiency. The Court invoked this principle to emphasize petitioner's heightened duty as agency head and to justify the modification of penalties.

• People vs. Ducosin, 59 Phil. 109 (1933) — Followed for the principles underlying the Indeterminate Sentence Law, including the goal of individualizing penalties and the factors courts should consider when imposing penalties, such as the criminal's age, health, mentality, previous conduct, education, demeanor, and the gravity of the offense.

• Martinez vs. Villanueva, 669 Phil. 14 (2011) — Cited for the definition of malum prohibitum: it is the commission of the act as defined by law, and not the character or effect thereof, that determines whether the provision has been violated.

• Section 52(g), Republic Act No. 8291 (GSIS Act of 1997) — Penal provision making heads of offices of the national government, its political subdivisions, branches, agencies, and instrumentalities, including government-owned or controlled corporations, criminally liable for failure, refusal, or delay in the payment, turnover, remittance, or delivery of accounts due the GSIS within thirty days from when due and demandable. The penalty is imprisonment of not less than one year nor more than five years, a fine of not less than ₱10,000.00 nor more than ₱20,000.00, and absolute perpetual disqualification from holding public office and from practicing any profession or calling licensed by the government. Applied to convict petitioner in Criminal Case No. 26707 for non-remittance of ₱2,418,577.33 in GSIS premiums.

• Section 1, Rule XIII, Implementing Rules and Regulations of Republic Act No. 7742 — Penalty clause pursuant to Section 23 of P.D. No. 1752, as amended, rendering the employer liable for refusal or failure without lawful cause or with fraudulent intent to comply with collection and remittance of employee savings and required employer contributions. The penalty is a fine of not less but not more than twice the amount involved, or imprisonment of not more than six years, or both, at the discretion of the court. Applied to convict petitioner in Criminal Case No. 26708 for non-remittance of ₱149,100.00 in Pag-IBIG Fund premiums.

• Section 5, Rule VI, IRR of R.A. No. 7742 — Requires employers to remit contributions within fifteen days from the date of collection; refusal or failure to collect and remit subjects the employer to a penalty of three percent per month from the date the contributions fall due and until payment thereof. Applied as the basis for the 3% per month penalty imposed in Criminal Case No. 26708.

• Section 1, Rule III, IRR of R.A. No. 7742 — Defines "employer" as any person, natural or juridical, domestic or foreign, who carries on in the Philippines any trade, business, industry, undertaking, or activity of any kind and uses the services of another person, including the government, its national and local offices, political subdivisions, branches, agencies, or instrumentalities, and corporations owned and/or controlled by the Government. Applied to establish that the head of the government office or agency has the obligation to remit contributions.

Carpio (Chairperson), Brion, Del Castillo, and Mendoza, JJ., concurred.