SEC Chairman Fe Barin told a House hearing yesterday her agency is giving CAP 20 more days to explain why it has failed to bring in investors and additional equity as repeatedly required by the commission, which serves as the regulator of pre-need companies.
After that period and CAP still fails to comply with the requirement, "we will have to take over to conserve its resources and protect planholders fairly and equally," she said.
She said the SEC has given the troubled firm enough time since it started encountering difficulties early last year to come up with fresh capital to answer for future obligations.
She said none of the promised new fund infusions has materialized, bloating CAP’s shortfall from P3 billion last year to about P25 billion at present.
During the hearing, CAP officials said a European foundation was willing to infuse investments provided that SEC return the company’s dealer’s license to make it a legitimate business entity.
They said several months ago, a potential Filipino investor offered 3,000 hectares of land as equity but has withdrawn his offer since SEC has not re-issued the dealer’s license.
Representatives Danilo Suarez of Quezon, Jacinto Paras of Negros Oriental, Harlin Abayon of Eastern Samar, and Milagros Magsaysay of Zambales supported CAP’s plea for its license, saying that the infusion of fresh funds into the beleaguered firm would benefit its planholders.
Paras went as far as suggesting that SEC temporarily return the permit and revoke it again if no new money comes in after a reasonable time.
But Barin, a lawyer and former member of the Monetary Board, stood her ground, saying they would have to do their duty to protect CAP’s planholders.
Philip Piccio, who represents aggrieved planholders, told the hearing panel that the Filipino investor that CAP officials referred to is suspected illegal logger Romeo Roxas.
He said the land that he was offering as equity is mostly in the mountainous area of Aurora and that part of it has questionable titles.