Toxic combinations

TRACING the $81-million stolen money from the Central Bank of Bangladesh that entered the Philippine financial system together with the recent opening of the campaign period for local officials was a toxic combination that obviously diverted market attention and interest.

Average daily value turnover conspicuously decreased by 4 percent last week.  This also made the market to settle lower at 7,245.13 and end with a weekly loss of 114.96 points or 1.56 percent.

The Bangladesh heist is the latest in an increasing number of large bank thefts that do not rely on the old-fashioned “stocking masks and sawn-off shotguns with the precision of a Hollywood drama” but through the use of speed and anonymity through the Internet.

Criminal experts attribute this new style of bank robbery to the increasing alliance between traditional and digital criminals.  Hackers have developed the ability to break into the computer systems of financial institutions. Together with traditional criminals who have also developed techniques to launder money, the combination had in recent times produced smooth bank heists.

Casinos are not under the coverage of the Anti-Money Laundering Act or Republic Act No. 9160. This loophole allegedly allowed the possible entry of the Bangladesh stolen money into the country.

The efforts to recover the stolen money have initially yielded some results.  As of last Thursday, casino junket agent Kam Sin Wong (Kim Wong), turned over $4.63 million to the Anti-Money Laundering Council (AMLC).  The amount was supposedly part of the stolen money received by his company, Eastern Hawaii Leisure Company Limited.

Today will be another interesting day.  The Senate Blue Ribbon Committee will resume its fourth hearing into the case.

Expected to grab the public’s interest will be Wong’s story—that of the $81 million stolen money, about $63 million went to Solaire Resort and Casino and Midas Hotel and Casino and that about $17 million was still with Philrem Service Corporation.

Of further interest, too, is the story on how all of the parties and personalities involved in the entry, delivery and final distribution of the $81-million stolen money became to be connected with each other.

On the political front, meanwhile, a total of 558 candidates at the local level are already assured of winning because they are running unopposed. For instance in the Ilocos region, a total of 66 positions are unopposed, making it the region with the highest number of uncontested candidacies.

Of note, a good number of these candidates are incumbents.  Of greater significance, the majority of the candidates belong to the ruling Liberal Party and its coalition, the National Unity Party (NUP).

The NUP is a political party formed by former members of the Lakas-Kampi-CMD and accredited by the Commission on Elections as a national party in 2011.

In 2012, the party held its first national convention and announced their support for President Aquino in the 2013 elections.  Most of the NUP members, however, ultimately supported the United Nationalist Alliance (UNA) of Vice President Jejomar Binay.

Bottom line spin

The efforts to trace and recover the stolen money may have already yielded a total of $6.97 million. The additional $2.34 million will come from Solaire, since it has been holding the sum since March 10 (following the investigations) and is just awaiting proper court order to return it.

In reality, it may be impossible to retrieve all of the stolen money. The country’s legal and financial foundations are not that strong. Practicing the “unless there’s a material impact,” banks and financial service companies will continue to withhold their reports on cyber thefts.

It is also observed that the relatively huge number of uncontested elections can be both good and bad for local governance.  They can be an indication of real popularity and satisfaction among the electorate.

They can, as well, be a reflection of the negative impact of political dynasties.  They leave the electorate with not much choice.  And as claimed, elections can only be meaningful when voters have a choice.  Accordingly, elections give voters some form of leverage to demand governmental reforms.

In the meantime, this situation may just serve as key for the candidates running for national positions their much needed victory.  If this happens, we might have a repeat of an electoral upset like that of 2010.

(The writer is a licensed stockbroker of Eagle Equities, Inc. You may reach the Market Rider at [email protected], [email protected] or at www.kapitaltek.com.)