Two brokers in BW mess want charges dropped

Two of the five broker companies charged with stock price manipulation have denied knowing any alleged anomalous transactions of presidential friend and Best World Resources majority owner Dante Tan.

In separate counter-affidavits filed with the Department of Justice, Aurora Securities Inc. and PNB Securities Inc. were one in saying that they had no knowledge about Tan's alleged misdeeds.

"It is our position that PNB was wrongly impleaded in this case. There was no violation of the Revised Securities Act, primarily because (PNB) had no knowledge that the other party dealing with them was also representing Dante Tan," said lawyer Noel Francis Rivera, counsel for PNB.

Aurora president Emmanuel Edward Co said they did not knowingly tolerate Tan's tactic to "create a false impression of active trading."

Aurora Securities and PNB Securities as well as SEC 2000 Inc., Mark Securities Corp. and Belson Securities Inc. were accused on April 6 by the Securities and Exchange Commission (SEC) of conspiring to manipulate BW prices.

SEC also filed criminal charges against Tan, BW lawyer and stockholder Jimmy Juan, and Eduardo "Moonie" Lim, president of the gaming company who went on leave last February following the stock market scandal.

Separate investigations were launched by the SEC, the Philippine Stock Exchange (PSE) and the Senate after BW shares shot up nearly 5,000 percent during 1999, before crashing.

The SEC document showed that Tan, through broker companies, committed several violations such as wash sales, where the buyer and seller of stocks are the same or there is no change in beneficial ownership.

Tan was also implicated in several done-through transactions, where the buying and/or selling broker places his stock orders through another broker.

While this is not prohibited by law, it becomes a manipulative device when it tends to show that there is a public demand for such a stock, the document said.

Regarding Lim, the SEC said he violated the law when he bought a number of shares while being an executive of BW. A person who violates this law could be penalized by up to P500,000 and face a jail term of 21 years.