Palace: Reforms, not Yasay report, will restore investorconfidence

A Palace official criticized Securities and Exchange Commission Chairman Perfecto Yasay Jr. yesterday for making it appear that his report on alleged stock price manipulation will save the bourse.

Executive Secretary Ronaldo Zamora said it is not Yasay's report that will salvage the Philippine Stock Exchange but a revamp at the SEC as well as the reforms to be instituted at the PSE.

"We have long said that Congress should look into reforms in the PSE. We cannot have the PSE fully owned by stockbrokers. We should allow the public to gain more control of the stock market," he said.

Meanwhile, the Court of Appeals ordered the SEC to explain why the evidence it gathered against presidential friend Dante Tan should not be turned over to the Department of Justice.

"The court hereby orders (the SEC's Prosecution and Enforcement Department) to file within 10 days from notice hereof their comments, not a motion to dismiss, to the petition for prohibition and mandamus and to show cause why no writ of preliminary injunction should be issued in favor of the petitioner," it said in a single-page order.

Tan, majority owner of BW Resources Corp., sought the appellate court's help because he said the SEC's investigations on alleged stock price manipulation were a "sham" and were conducted with "undue haste."

He added Yasay could in no way be impartial since he had ordered lawyer Ruben Almadro, head of the PSE's Compliance and Surveillance Group, to furnish him a copy of its report on alleged insider trading activities at the bourse.

"For reasons only known to Yasay, all he needed from the PSE was a half-baked preliminary report implicating (Tan). As early as then, it is clear that Yasay could not be shaken from his obvious resolve that (Tan) was guilty of price manipulation necessitating swift enforcement action," the presidential friend said in his 26-page pleading.

Tan also complained that he was singled out by the probers even if there are still others who may have been involved.

"The investigation against (Tan) was carried out in the briskest of steps. The Prosecution and Enforcement Department had totally surrendered its powers to Yasay," he said.

"Due process contemplates not only the right to be heard but also the right to be heard by an impartial tribunal so much so that the absence of the latter will render the former illusory," he added.

Last week, Yasay said the SEC will recommend the prosecution of 11 individuals or brokers implicated in its investigation of improper trading of BW.

He did not identify the 11 individuals or brokers, and declined to say whether they are the same ones implicated in a separate investigation by the PSE.

But he said the SEC will recommend to the justice department the filing of "four to five" criminal charges against each of the 11.

Yasay said the charges would be "along the area of manipulation and insider trading."

He said he does not expect the investigation into BW to be finished before his resignation on March 25. He said he is confident, however, that incoming SEC Chairperson Lilia Bautista will ensure the completion of the probe.