RCBC vows to boost internal controls, apologizes for $81M scandal | Inquirer Business
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RCBC vows to boost internal controls, apologizes for $81M scandal

/ 12:25 PM March 23, 2016

YUCHENGCO-led Rizal Commercial Banking Corp. vowed on Wednesday to plug any weakness in internal controls and operations which allowed $81 million in dirty money stolen by hackers from the central bank of Bangladesh to slip into the local financial system.

The bank also offered “sincerest apologies” for the involvement of its personnel in the money laundering scheme which is now the subject of investigations by the Senate Blue Ribbon Committee and the Anti-Money Laundering Council (AMLC).

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“Within legal bounds, RCBC will cooperate with these and any subsequent government proceedings,” RCBC said in a public statement.

RCBC said it was likewise “conducting its own inquiry to identify and address any weaknesses in its controls and operations which may have facilitated the scheme.” It vowed to take “appropriate” action against any bank or officer or staff found guilt of fault or negligence.

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“RCBC recognizes the evils wrought by money laundering and will do its utmost in the fight against it,” the bank said.

On Tuesday, fired its Jupiter branch manager Maia Santos-Deguito and her deputy Angela Torres for their alleged involvement in the money laundering scandal. Other branch and bank officials are expected to be meted out various sanctions ranging from termination to suspension in the coming days when the internal investigation is expected to be completed, RCBC head of legal and regulatory affairs Maria Cecilia Fernandez-Estavillo earlier said.

Proceeds from what was now touted as the biggest bank heist in history were wired from the account of Bangladesh Bank with Federal Reserve Bank of New York to four bank accounts in RCBC Jupiter Street branch on Feb. 5.

Torres is the senior customer relationship manager at RCBC’s Jupiter branch and deemed as the deputy of Deguito in this unit.

The two women were accused of violating bank policies and procedures as well as falsification of commercial documents as grounds for the termination of these two branch officers.

Deguito had been in preventive suspension since Feb. 16 while Torres had pulled out of the branch since then. The termination of Deguito and Torres was effective Tuesday, March 22.

The bank claimed that Deguito and Torres had breached the rules and facilitated the alleged laundering of $81 million of remittance.

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Based on an internal timeline submitted by RCBC head office to AMLC dated March 14, Deguito appeared to be a rouge banker who had anticipated the big inflow and facilitated its speedy withdrawal with some help within her own branch.  Torres was among those accused of assisting Deguito in facilitating the withdrawal of some $58 million on Feb. 9 even after Bank of Bangladesh had issued a “stop payment” request.

Only $68,000 of the $81 million money stolen by what is believed to be an international syndicate from Bangladesh had been frozen and returned to the central bank.

Deguito facilitated the opening of the four US dollar accounts that received the suspicious remittance from Bangladesh.

The US dollar bank accounts were opened on May 15, 2015 under the names of Enrico Vasquez, Alfred Vergara, Michael Cruz and Jessie Christoper Lagrosas with initial deposit of $500 each. Deguito claimed that she had done the required due diligence or know-your-client rule but these names and the corresponding addresses turned out to be ficticious.  These accounts were untouched until Feb. 5 this year when the big remittance from Bangladesh came.

The internal RCBC report also suggested that Deguito had vouched for the transaction, hastily processed the withdrawal of the money while intimating to other staff in the same branch that she feared for her life and for her family.  The internal RCBC report also backed the allegation of businessman William Go that she had falsified documents to open a new US dollar account under the name of businessman William S. Go DBA Centurytex Trading, the same account used to consolidate bulk of the suspicious money from Bangladesh.

By March 1, the suspected accounts were ordered frozen by the Court of Appeals based on the petition filed by AMLC, the agency mandated to enforce the anti-money laundering law in the country.  By then, the money that came in on Feb. 5 had found  its way to local casinos and other entities.

Deguito had pointed to businessman Kim Wong as the one who had referred the suspicious accounts and a major player in this scheme but not before accusing RCBC president Lorenzo Tan of knowing about the entire thing. She had even claimed that the president had handpicked her and guided her how to explain the transaction – allegations which Tan had branded as an “outright lie.”

This money laundering controversy had put the Philippines in a negative light globally and heightened calls to repeal the bank secrecy law and give more teeth to the AMLC to directly freeze and investigate suspicious bank accounts as well as to include casinos among entities covered by reporting obligations under the anti-money laundering law.

Ferdinand Topacio, the legal counsel for Deguito had accused RCBC head office of trying to cover up for “certain” bank officials. He had also questioned RCBC’s ability to make an “impartial inquiry,” adding that top officials were in a position to delete emails, shred documents and influence or intimidate lower-ranking bank officials who may know matters regarding the alleged money-laundering transaction.

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TAGS: Maia Santos-Deguito, Maria Cecilia Fernandez, money laundering, RCB, RCBC
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