Romulo, EPCI Bank officials may face charges for SRC violations

Officers and directors of Equitable PCI Bank including former Foreign Affairs Secretary Roberto R. Romulo, may face criminal and administrative charges for breach of securities rules and regulations of the Revised Penal Code, according to an official of the Securities and Exchange Commission (SEC).

SEC commission secretary Gerard Lukban said the agency is studying the possibility of imposing administrative and criminal charges against the bank and its directors for failure to disclose material information in violation of the Securities Regulation Code (SRC).

In particular, the bank failed to disclose that Romulo was the chairman and director of Equicom Systems Management Inc. (ESMI), a company majority owned by Equitable Development Corp. a substantial shareholder of EPCI Bank. EDC is wholly-owned by the Go family led by Antonio L. Go, the present chairman of EPCI Bank.

The SEC said Romulo is not qualified to be even nominated as an independent director of EPCI Bank due to a provision in the SRC that states that an independent director must not be an officer or employee of the corporation they serve, as well as any affiliate, subsidiary or related company thereof.

EPCI Bank was directed by the SEC to "show cause why it should not be sanctioned under Sections 20 and 54 of the Securities Regulation Code" for "incomplete disclosure of information in the information statement filed by the bank relating to Romulo’s qualification.

Government Service Insurance System (GSIS) president and general manager Winston Garcia earlier filed criminal charges against five officials of EPCI Bank for allegedly conspiring to have

Romulo elected as an "independent director" knowing his lack of qualifications, and withholding the information from the bank’s stockholders, other directors and the bank’s nomination committee.

Lukban said even as Romulo withdrew his nomination as independent director, he, as an incumbent director of the bank, is still liable for contined violation of the SRC.

Romulo is the second independent director candidate disqualified by the SEC due to violation of the SRC. Last week, the SEC barred former Environment and Natural Resources Secretary Fulgencio Factoran since he is a director of PCI Leasing and Finance Corp., a wholly-owned subsidiary of EPCIB.

The SEC has also directed EPCI Bank to provide a discussion on how it shall disseminate all stockholders nominees for independent directors, as prescreened by the bank’s nomination committee prior to the holding of the stockholders’ meeting scheduled on July 19.