Borlongan seeks reconsideration on Urban Bank versus BSP case

Former Urban Bank president, Teodoro Borlongan, recently filed his motions for reconsideration before the Ombudsman, on the latter’s decisions dismissing the criminal complaint against BSP Governor Rafael Buenaventura and five other BSP officials, and finding only four of them, including Deputy Governor Alberto Reyes, administratively liable.

Borlongan charged BSP officials for falsification of the three BSP reports that recommended the immediate closure of Urban Bank, Urbancorp Development Bank (UDB), and Urbancorp Investments, Inc. (UII). The reports allegedly contained falsified statements and findings, and were made to appear that they were submitted to the Monetary Board before the closure order on April 26, 2000.

In his motions, Borlongan cited serious errors of law and procedural irregularities by the Ombudsman.

In the resolution, the Ombudsman dismissed the criminal complaint on the basis that "responsible officials of the Central Bank are only recommendatory".

Borlongan cited a Supreme Court ruling that under the anti-graft code, it is the "commission of the act as defined by the law, not the character or effect thereof that determines whether or not the provision has been violated. . . the law does not merely contemplate repression of acts that are unlawful or corrupt per se, but even of those that may lead or result in graft and corruption."

The Ombudsman "insinuate (d) that it is legal, just and moral for government officials to make incorrect or false recommendations, based on evident partiality, bad faith, or gross negligence, simply because they are recommendatory," according to Borlongan.

He also questioned the procedural irregularities by the Ombudsman. The latter decided on the cases without Borlongan’s reply-affidavit. Under the Ombudsman’s Rules of Procedure and the Rules of Court, the complainant has the opportunity to reply to the counter-affidavits of respondents. In both the criminal and administrative cases, which are separate and independent investigations, the Ombudsman overlooked twice that it did not give such opportunity to Borlongan to file his reply-affidavit.

In his motions, Borlongan submitted eight additional new evidence concealed by BSP, alleging that they made further false statements in their counter-affidavits. Among the evidence was BSP Circular No. 156 issued in 1998 which disproved BSP’s reports that Urban was capital-deficient. Also, the BSP Manual of Examination Procedures showed that BSP grossly violated its procedures when it prepared the reports.

Borlongan also accused Reyes of perjuring himself by covering up the fact that Urban Bank and UDB were the first banks to be ever closed for illiquidity, "in the 52 years of the old and new Central Bank Acts."