The Bangko Sentral ng Pilipinas (BSP) has apparently filed charges against seven officers of D 1st Cell Pawnshop Inc. (D1CPI) for soliciting investments from the public without authority from the BSP in violation of our General Banking Laws of 2000. This is what I know as quasi-banking and therefore it is illegal because this is not under the purview of pawnshops. I’m glad that the BSP has begun looking into the operations of pawnshops; after all, they are what I would call the “banks of last resort” as they accept any collateral you could offer to them in return for a loan.
Incidentally, before we start forgetting that infamous Legacy scam, a couple of weeks ago, the BSP also filed large-scale estafa charges against Celso de los Angeles Jr. and Pilipino Rural Bank’s former presidents and board members Alexis Petralba and Wilfredo Novo for conspiring to willfully and fraudulently withdraw and siphon off P262.2 million from Cebu-based Pilipino Rural Bank to the detriment and prejudice of the depositing public and their creditors.
BSP investigators learned that there was an unauthorized diversion of funds made to the current account maintained by Celso de los Angeles at the Pilipino Rural Bank via a fraudulent accommodation of 3,401 unfunded and returned checks amounting to P262.3 million from September 2007 to September 2008, where De los Angeles got funds from the Pilipino Rural Bank through his current account. This bank, which had deposits of P2.27 billion, declared a bank holiday last Dec. 8.
According to the BSP report, this case is the seventh filed by the BSP against the Legacy Group. There are four other cases for syndicated estafa from Leyte, Negros Oriental and General Santos City and two other cases for falsification of public and commercial documents filed against 16 officers, employees and agents of the Legacy Group.
With the case of the Legacy Group now filed in our courts, the BSP has apparently forgotten another Cebu-based rural bank that collapsed early January this year. I’m referring to the Rural Bank of Subangdaku (RBS), owned by the Gaisano family and run by former president Paz Radaza, wife of Lapu-Lapu City Mayor Arturo Radaza who is running for the next mayor of Lapu-Lapu City as Mayor Radaza will be graduating this year. Mrs. Radaza quit as president of this bank almost simultaneously when it collapsed, leaving thousands of depositors (many of them their constituents in Lapu-Lapu City) holding empty deposits.
Some may say that the RBS collapsed at the time when the rural banks of Legacy started folding up by December. However, the truth is, when the Legacy banks declared a bank holiday, all rural banks were affected by massive withdrawals and that included RBS. However due to the Christmas break, RBS was able to hold on for a few more weeks. But on the first day of work in January 2009, RBS declared a bank holiday.
When the Cebu media hounded Mrs. Radaza to issue a statement as to why RBS collapsed, she said, “In the proper time I will provide the public and the regulators with a copy of my resignation letter to the board of directors of RBS so that the truth will come out.” If you ask me, it’s more than six months since the RBS has shut down and Mrs. Radaza’s much-awaited statement is for all intents and purposes already… to borrow a banker’s lingo, “past due.” I really don’t know why it is taking Mrs. Radaza that long to issue that statement; I can only reckon that it just might be too sensitive and it might possibly cost her election as mayor.
Her refusal to issue that statement makes people suspicious that she just might be involved in some kind of hanky-panky with the bank. Already rumors continue to persist that the Radazas withdrew a huge amount deposited in the bank, which might have precipitated or hastened its collapse. With of these rumors, a few weeks later, Lapu-Lapu City Councilor Junard Chan blamed RBS officials for making massive withdrawals that led to the bank’s collapse. He openly challenged Mrs. Radaza to come out in the open and explain to the bank depositors how and why RBS collapsed. That challenge was met only by deafening silence
Because Mrs. Radaza has zippered her mouth on this issue, we appeal to the BSP to dig deeper into the RBS case. Was it true that someone among the bank officers got close to a billion pesos in loans? Can the BSP identify who were the personalities who made massive withdrawals that could have led to the untimely collapse of the bank? Let’s hear it from the BSP!
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For e-mail responses to this article, write to vsbobita@mozcom.com or vsbobita@gmail.com. Avila’s columns can be accessed through www.philstar.com.