DOJ seeks arrest of 5 HK Securities officials for syndicated estafa

MANILA, Philippines - The Department of Justice (DOJ) has sought the assistance of the Philippine National Police (PNP) and the National Bureau of Investigation (NBI) for the immediate arrest of five officers and directors of defunct brokerage HK Securities on charges of syndicated estafa.

In an order dated Dec. 10, 2010, Justice Secretary Leila M. De Lima asked the PNP and the NBI to arrest HK Securities president and principal shareholder Rodolfo V. Cruz, and other officers, namely Cecilia F. Cruz, Primalee Cruz-Cordero, Abelardo R. Cordero and Melogen Buesa.

De Lima said “not one of the accused has been arrested to date” since the Pasay Regional Trial Court issued an arrest order against these people last April 27, “thereby rendering all efforts of the prosecution meaningless.”

The court recommended no bail for the accused who are still at large.

In 2008, several complaints of syndicated estafa were filed with the Department of Justice (DOJ) by clients of HK Securities against the accused as well as other non-executive directors for numerous fraudulent transactions involving the complainants’ funds and securities. DOJ senior state prosecutor Peter L. Ong was designated to actively prosecute the criminal cases filed against the accused.

The PSE took over HK Securities’ operations upon an order from the Securities and Exchange Commission on Sept. 25, 2008 when the company failed to account and produce securities of its clients worth approximately P106 million. HK Securities and its principal stockholder, Rodolfo V. Cruz, previously undertook but failed to pay the short security position.

Prior to the takeover, the PSE Market Regulation Division (MRD) suspended HK Securities from its trading operations based on various violations of the securities laws uncovered during MRD’s audit of HK Securities. The MRD subsequently issued an order expelling HK Securities from the PSE, among other sanctions imposed for the said violations. HK Securities had appealed the sanctions.