Ex-Banco Filipino officers slapped with criminal complaint
MANILA, Philippines – It's probably never too late.
Twenty former stockholders and officers of the closed Banco Filipino Savings and Mortgage Bank (Banco Filipino) were the subject of a criminal complaint filed by the Philippine Deposit Insurance Corporation (PDIC) before the Department of Justice on July 6.
The complaint against them and their related entities stems from the department's findings that they conducted "business in an unsafe and unsound manner that resulted in estimated losses of P1.4 billion to the bank.”
Banco Filipino is a 62-unit bank ordered closed by the Monetary Board and placed under receivership of the PDIC on March 17, 2011. READ: CA flip-flops: Banco Filipino stays closed)
Named in the complaint were the following former Banco Filipino officers:
- Albert C. Aguirre, Director and Vice Chairman (also stockholder of BF Citi and sole receiver of BF Homes, Incorporated [BF Homes] at the time the alleged violation was committed)
- Teodoro O. Arcenas, Jr, Director and Chairman
- Orlando O. Samson, Director and Executive Vice President (also Director of BF Homes)
- Lualhati L. D. Nicolas, Executive Vice President
- Jovito N. Hernandez, Executive Vice President
- Serafin P. Tongco, Senior Vice President
- Romeo M. Avila, Senior Vice President
- Delfin M. Dimagiba, Director and Treasurer (also a BF Citi stockholder)
- Elena L. Pallasigue, Assistant Vice President
- Dionisio M. Domingo, Vice President
- Conrado P. Banzon, Director
- Cesar S. Paguio, Director
- Grace L. Daguna, Assistant Manager
- Maxy S. Abad, Executive Vice President (also Chairman and President of Filipino Vastland Company (Vastland); Director and Vice Chairman of BF Citi, BF General Insurance Company, Incorporated (BF General) and BF Life Insurance Corporation (BF Life); and Treasurer of BF Homes
The following are officers of related entities to Banco Filipino:
- Virginia V. Serrano, Director and President of BF Citi (also Assistant Treasurer of Glamor World, Incorporated [Glamor], and stockholder of Pro Managers, Incorporated);
- Rosalina E. Tacolod, BF Homes Vice President
- Mary Lou A. Vasquez, BF Homes Vice President
- Antonio S. Calleja, Executive Vice President, BF Citi
- Jerome H. Velhagen, Treasurer, Glamor
- Joseph C. Velhagen, Sr, Director, Glamor and Vastland
- BF Homes, BF Citi, BF General, BF Life, Glamor, and Vastland are entities related to Banco Filipino.
The complaint alleged that in 2001, the respondents took advantage of their positions and connived with officers and stockholders of Banco Filipino and its related entities to sell the bank’s Head Office property to BF Homes for P685 million ($15.19 million) and use the bank’s funds to pay for the purchase.
The alleged sale took place when BF Homes did not have the financial capacity to pay for the sale, having been under rehabilitation.
Records of the bank showed that Banco Filipino granted questionable loans in favor of Vastland and Glamor – entities that allegedly had negative credit standings with at least 20 other banks.
The loans were allegedly secured by overvalued properties of BF Homes, BF General, and BF Life, and the loan proceeds were supposedly to be used by Vastland and Glamor to acquire and develop real estate properties in Cavite.
However, the loan proceeds were allegedly diverted to fund the checks of BF Homes which were used to pay for the purchase of the head office premises.
Thus these transactions showed that the bank used its own funds to buy its own property.
The complaint before the DOJ also alleged that respondents planned to transfer its service offices to a cheaper property located in Las Piñas, to help generate income or savings for the bank to justify the sale of its head office property.
But the bank did not relocate and instead rented the head office from BF Homes until the bank was ordered closed in 2011.
The complaint further alleged that respondents also made Banco Filipino pay BF Homes rental fees higher than prevailing rates, with the bank paying an estimated total amount of P844.70 million ($18.73 million) from 2001 to 2011.
“Moreover, they orchestrated other fraudulent activities and irregular transactions over the same 10-year period,” PDIC noted.
PDIC, established in 1963 by Republic Act 3591 to provide depositor protection and help maintain stability in the financial system, said it filed the complaint to protect the depositing public and to bring to justice parties that engage in acts that will put depositors and the Deposit Insurance Fund (DIF) at risk.
“PDIC continues to pursue legal actions against bank officials and personnel who engage in unsafe and unsound banking practices that pose grave threats to the stability of the country’s banking system,” it said. – Rappler.com
$1 = P45.10