MANILA, Philippinews–The arrest of a former Cavite bank executive—charged with the misuse of three quarters of a billion pesos of clients’ deposits—has finally been ordered by a local court more than two years after regulators filed their complaint.
In a statement, the state-owned Philippine Deposit Insurance Corp. (PDIC) said the Regional Trial Court of Imus, Cavite, on Sept. 15 issued a warrant of arrest for Banlee Choa, former chair and president of GMA Rural Bank.
Choa was charged with estafa by the Department of Justice (DOJ) based on a complaint filed by PDIC before the DOJ Task Force on Financial Fraud. Choa remains at large.
Banking laws prohibit banks from excessive lending to companies owned by stockholders and officers of the bank, which is considered a poor way of using money entrusted to lenders by the public.
GMA Rural Bank was shut down and placed under the PDIC’s receivership in February 2011. Charges against Choa were filed in May of the same year.
The PDIC said Choa masterminded the creation of a special division at GMA Rural Bank that did just one thing: Lend money to companies owned and controlled by Choa or his relatives.
“And upon receipt of the said amount through the said corporations, Choa used the same for himself or for his own benefit,” PDIC said.
Based on the complaint of PDIC filed at the DOJ, the special division of GMA Rural Bank that granted unsecured loans was referred to as the“Executive/Extension Office” and the Choa corporations involved included Tri-B Corp., Hauskon, Landblazers and Landprimers.
Others charged were director Ma. Corazon T. Choa, who was director and stockholder of the bank and other Choa-led companies. Directors and stockholders Cherry Lyn C. Madarang, Carson T. Choa, Carter T. Choa, Carvin T. Choa, Carlo T. Choa and Celine T. Choa were also named in the complaint due to their “involvement in the management of GMA Rural Bank and its Executive/Extension Office.”
“Meanwhile, the other respondents were officers of various Choa corporations who, according to witnesses, scrambled for various bank documents prior to the bank’s closure to hide the operations of the Executive/Extension Office,” PDIC said.