PDIC slaps Banco Filipino execs with P669-M estafa complaint

The state-owned Philippine Deposit Insurance Corp. (PDIC) filed with the Department of Justice (DOJ) a criminal complaint against the former directors, officers, employees and consultants of the closed Banco Filipino Savings and Mortgage Bank for syndicated estafa that resulted in estimated losses of P669.6 million to the bank.

The complaint was filed last July 5, 2016, and was scheduled for setting of initial hearing by the DOJ Task Force on Financial Fraud, the deposit insurer said in a statement.

Banco Filipino is a 62-branch bank ordered closed by the policy-making Monetary Board of the Bangko Sentral ng Pilipinas and placed under receivership of the PDIC on March 17, 2011.

Charged with committing syndicated estafa in violation of Presidential Decree No. 1689 (1980) were the bank’s former vice chair Albert C. Aguirre, former chair and president Teodoro O. Arcenas and 31 other former officers, employees and consultants.

In its complaint, PDIC alleged that the respondents—acting “with abuse of confidence” as bank directors or officers—“conspired and misappropriated” Banco Filipino funds solicited from the depositing public amounting to P669.6 million to pay for their travels abroad from January 2000 to July 2003.

The syndicated estafa led to bank losses. Even after the bank was ordered closed on March 17, 2011, respondents failed to return the amount.

Banco Filipino, which started operations in 1964, was first ordered closed in January 1985. It was in 1991 when the Supreme Court ordered its reopening and three years later, Banco Filipino resumed operations under the comptrollership of the BSP, in compliance with the Supreme Court order.

Due to the bank’s good financial health, BSP’s comptrollership was lifted in January 2000.

PDIC alleged that based on investigation, the crime of syndicated estafa was committed after BSP’s comptrollership was lifted. With a net loss of P1.78 billion and a net asset decline of almost 50 percent for a three-year period since 2000, Banco Filipino was again placed under BSP comptrollership.

In 2011 when the Monetary Board ordered the bank’s closure again, PDIC discovered several anomalous expenditures incurred by the bank starting 2000 until July 2003 representing travel expenses of the bank’s directors, officers, consultants and employees.

Of this amount, P621.2 million was unliquidated. Another P48.4 million was spent for the activities of Los Tamaraos Polo and Equestrian Center Inc., an affiliate company of Aguirre, and sponsorship of a tournament in London, England, as well as personal expenses such as clothing, toiletries, perfume and accessories, groceries, freight services, vehicle repair and maintenance, license registration, drugstore purchases and medical fees.  Daxim L. Lucas