MANILA, Philippines -- George Ty and other top executives of the Metropolitan Bank & Trust Co. have been sued for syndicated estafa amid allegations that the bank, through one of its branches in Manila, amassed tens of millions of pesos from a former corporate client.
The complaint was filed by representatives of the Zhenron Corp., a diesel oil importer, recently before the Manila Prosecutor's Office. Top executives who were named as respondents to the complaint aside from George Ty, the Metrobank group?s chairman, were Arthur Ty, the bank?s president, and Antonio Abacan Jr., the bank chairman.
Zhenron said in the complaint, public records of which were obtained by the Philippine Daily Inquirer last week, that Metrobank, through its branch at the corner of Leon Guinto St. and Quirino Ave. in Manila, took about P31 million from Zhenron's savings deposits with the bank and about $700,000 (about P31 million) worth of personal insurance policies of the owners of the oil firm.
The personal insurance policies were issued to a couple and Zhenron owners, Maureen and Seiichi Horri, by AXA, the bancassurance partner of Metrobank.
Maureen Hori said in the complaint that Metrobank "took" their money by "falsely" claiming that Zhenron Corp. had unpaid obligations with Metrobank and that the money was taken to partly cover for interests on the obligation.
Prior to the filing of the complaint before the Prosecutor's Office, Maureen Hori said, the matter was brought to the attention of George Ty, and Abacan, and other top officials of the bank, but that Zhenron got no response from them. This prompted the respondents to include the three in the complaint.
Others charged were branch manager Wilfredo Pajarin, account manager Marie Christine Bancaflor, and directors of Metrobank.
Zhenron Corp. said in the complaint that in early 2009, the branch manager and other staff of the concerned Metrobank branch, where Zhenron had a savings account, encouraged the Hori couple to apply for trust receipts (a form of a loan for importers) to aid in their import business.
Zhenron indeed had secured five trust receipts from Metrobank for P700 million over the period April to July 2009.
Zhenron said the obligation was backed 100 percent by a collateral in the form of dollar time deposits placed with Metrobank.
Before the obligations matured, Maureen Hori said in the complaint that Zhenron instructed Metrobank to simply take over the collateral -- the dollar time deposit -- as payment, noting that the collateral was equivalent to 100 percent of the obligations anyway.
She said Metrobank and Zhenron formally agreed on the manner of payment.
By March 2010, however, Zhenron noticed that about P30 million from its peso savings account with Metrobank were missing, Hori added.
This prompted Maureen Hori and her husband to question Metrobank and were told by the branch officials that the money was taken as partial payment for interests to the loans Zhenron made earlier.
It turned out that Metrobank had been charging interests on the obligations, Hori said. "Metrobank made it appear that Zhenron did not pay the loans on time, that it requested several times for extensions of the loans, and that the bank granted the said ?extension requests,?" Hori said.
The extensions naturally entailed interests.
"Estafa was committed through falsification of a commercial document, the Trust Receipt. Falsification was committed by private individuals who made it appear that the maturity dates of the said documents were extended by Zhenron," Maureen Hori said in the complaint.
Moreover, Maureen Hori said Metrobank also took over her and her husband's personal insurance policies with AXA, which were worth about $700,000 (about P31 million), as part of "interests" on the "unpaid" obligation.
Months after charging interests, Maureen Hori said that Metrobank took over the collateral -- the dollar-denominated time deposit worth about P700 million.
She said Metrobank did not immediately take over the collateral, even if it was instructed to do so, so that the loan would appear to have remained unpaid and that interests could be charged. Eventually, Metrobank took over the collateral, she added.
Maureen Hori said in the records filed with the Prosecutor's Office that Metrobank offered to settle the matter with Zhenron. Metrobank offered the Hori couple P12 million as settlement, she said.
"...[Metrobank] offered Zhenron the amount of P12 million but with the agreement that the latter can no longer make any claim against them. Zhenron declined the offer," Hori said in the complaint.
Reached by the Philippine Daily Inquirer for comment, the Metrobank said it would not discuss the case in depth, pending the proceedings at the prosecutor's office. Nonetheless, it gave the Inquirer an official statement that read:
"Much like most business transactions, this is a case that concerns the agreements made between two parties. Metrobank implemented actions based on the agreements set with Zhenron," Metrobank said in the statement given to the Inquirer.
"In the bank's over 48 years of operation, it has always placed the highest premium on propriety of its dealings with clients and stakeholders, and on ensuring that it consistently adheres to banking regulations set by higher bodies within its industry," Metrobank added.
Records with the Manila Prosecutor's Office showed that Metrobank Leon Guinto-Qurino branch also filed an estafa case against the Zhenron owners. The complaint filed by Metrobank had the Hori couple liable for estafa because they allegedly failed to pay the full amount of interests on the loans.
Metrobank said Zhenron Corp. indeed did not pay the loans on time and requested for extensions of the obligations. Metrobank said that with the loan extensions, Zhenron had to pay interests.
Besides the estimated P31 million taken from the savings account of the Hori
couple and the P32 million worth of their personal insurance, some P30 million more are actually owed by the Hori couple to the bank still, representing unpaid interests on the same loans, according to the Metrobank.