FIRST CRIMINAL CONVICTION

Former stock broker convicted of securities violations

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09:23 AM March 20th, 2013

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By: Doris C. Dumlao, March 20th, 2013 09:23 AM

MANILA, Philippines — A former stock broker who had defrauded clients was convicted for seven violations of securities laws, the first criminal conviction under the Securities Regulation Code.

The regional trial court of Makati City (RTC) found Francisco Borromeo, former president of the defunct brokerage house Asian Capital Equities Inc. (ACEI), guilty of securities violations. He was sentenced to pay a total amount of P2.1 million.

The cases against Borromeo were filed on January 2005 for “unlawful and felonious acts he committed in order to defraud his clients, including, among others, the sale of his client’s shares without his client’s consent, the use of fictitious and dummy accounts in buying transactions and his failure to deliver the payment proceeds from the sale of his client’s shares,” the PSE said in a statement.

The stock brokerage ACEI was shut down in 2003 and its assets, including its trading right, were liquidated in 2008 to settle liabilities to clients.

The verdict was issued by Judge Selma Palacio Alaras of Branch 62 of the RTC on March 19, 2013 following the withdrawal of Borromeo’s pleas of not guilty and his voluntary entry of pleas of guilty on all seven charges, the PSE said in a press statement.

“In the course of the presentation of evidence against the accused, Mr. Borromeo reconsidered his not guilty plea and entered a plea of guilty,” Department of Justice Senior State Prosecutor Peter Ong said.

Borromeo was arraigned on Aug. 14, 2007 where he entered not guilty pleas to all the charges filed against him. In May 2007, the PSE sought the help of the public in tracking down Borromeo who had gone into hiding after several arrest warrants were issued against him.

Philippine Stock Exchange president Hans Sicat expressed that this decision was in line with the good governance efforts of the PSE and the government. “I understand that this is the first criminal conviction under the Securities Regulation Code which is one of the reasons why the PSE has been following this case closely. The outcome of this case shows that white collar crimes are punished in this country,” Sicat said.

“We thank all the hard work of the Securities and Exchange Commission and the Department of Justice in helping ensure that justice is served to Mr. Borromeo. This should help give more confidence to the growing investing public,” Sicat added.

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