Glasgow: SEC scores a first

The Securities and Exchange Commission (SEC) recently marked a first in its ongoing campaign to clean up the domestic small investments industry with the successful conclusion of the issues involving Glasgow Credit and Collection Services.

The SEC is currently overseeing the payment of close to P700 million to creditors of Glasgow following SEC’s move to lift the freeze order on the liquid assets of the firm deposited in five banks.

Late this year, the SEC issued a cease-and-desist order against Glasgow following unproven allegations that the latter was selling securities which was not allowed under its articles of incorporation. Glasgow said it merely executed loan documents with its creditors.

Following the SEC move to unfreeze its funds, Glasgow became the first company to pay out its creditors among several small firms the operations of which were stopped by the SEC. Industry observers said the SEC-supervised payout "is a bright spot in a market where investors are mired in uncertainty on the recovery of their funds".

Glasgow creditors also hailed the SEC feat. According to Rosalie Ignacio, a major Glasgow creditor, the move by the SEC "has done a lot to calm the public and further strengthen their confidence" in the regulatory agency.

Payment to Glasgow creditors began last Nov. 26. Glasgow president Manuel Roldan Jr. said the payout is expected to be completed by Dec. 15.

"We are happy that the SEC has helped us recover a major portion of our claims," Ignacio said. This is very important considering that investors in boiler-room firms have yet to recover a single centavo from their so-called investments, she added.

Rufina Cruz, another investor, said they are "luckier than depositors in closed banks who can recover only up to P100,000 from the Philippine Deposit Insurance Corp.". Based on SEC computations, Glasgow creditors stand to recover immediately up to 79 percent of the money they lent to the firm.

Cruz also cited the swift decision by the SEC to unfreeze the funds of Glasgow and pay out the firm’s creditors. "The SEC debunked rumors that we might have to wait for years before we can get paid," Cruz said.

The recovery of their funds "is crucial since most of us (Glasgow creditors) are only small investors," Cruz added. "SEC’s move enables us to use our funds to generate revenue for us," she explained.

She also lauded the "transparent dialogue between the SEC and Glasgow" which significantly reduced "the nervousness among creditors".

Cruz said the transparency "enabled us to keep track of the developments. This was important since the issue involved money that belongs to us," she added.

She also cited the public visibility of the corporate officers of Glasgow. Cruz said the transparent dialogue with SEC "helped reassure us that, unlike other firms being scrutinized by SEC, Glasgow’s officers are definitely here in the country". This, she added, removed panic among the firm’s creditors".