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Wednesday, February 02, 2005
Senator seeks closure of bank for 'sale of unlicensed securities'
* Presidential legal counsel denies allowing bank execs to flee RP
BECAUSE of the alleged sale of billions of pesos worth of unregistered foreign securities, Senator Juan Ponce Enrile has asked for the suspension or even revocation of the license of the Standard Chartered Bank.
In a privilege speech Tuesday, Enrile denounced the illegal practice allegedly committed by the foreign bank, which instead of gaining wealth, lost billions of
Pesos of hard-earned savings of its depositors.
Enrile sought an investigation of the alleged practice, which according to him, is as clear violation of Philippine laws.
"They have no God-given right to remain here, much less continue to do business in our country, if they show such contempt for our laws and such callousness against our own people," Enrile said.
Citing a document that has reached his office, Enrile said Standard Chartered allegedly sold over P8 billion of unregistered foreign mutual funds and that it owes the government at least P500 million in unpaid taxes, penalties and funds.
Enrile said Standard Chartered is said to have led the sale in Asia of Global Third Party Mutual Funds as a lucrative source of commission income.
However, the scheme is against Philippine banking laws as it involved the sale of unregistered securities or securities that do not meet the registration requirements of the Securities and Exchange Commission (SEC).
"Standard Chartered knew from the start that it stood to incur administrative, civil and criminal liabilities because it sought legal advise from its lawyers prior to implementing its proposed scheme. But it knowingly chose to violate Philippine laws because of the billions of pesos to be made," Enrile said.
The senator's privilege speech and resolution calling for an investigation were in reaction to numerous complaints he has received against the foreign bank, including those from Finance Secretary Cesar Purisima and lawyer Mark Bacobo. Many individuals and institutions, including retirement funds, were victimized by the scheme.
Meanwhile, Enrile said the SEC should explain in the legislative investigation the purpose of the P7 million that the bank has paid to them after dismissing the cease-and-desist order (CDO).
He also said the Senate committee on banks should summon former justice undersecretary now Presidential legal counsel Merceditas Gutierrez for allowing the officials of Standard Chartered to leave the country despite a hold-departure order (HDO) issued against them.
"She (Gutierrez) called on the airport officials to allow these foreigners to leave the country. But we will give her a chance to explain," Enrile added.
Gutierrez, for her part, denied in a press conference in Malacañang that she facilitated the escape of Standard Chartered Bank officials involved in the selling of fake securities.
Gutierrez said when she was acting justice secretary, she allowed the bank officials to attend a "very important conference" in Singapore but they had to come back to the Philippines afterwards.
She said the conference in Singapore was very important because it was attended by chief executive officers.
She said her decision was based on the recommendations of the chief state prosecutor and the prosecutors handling the case.
"I did not lift the HDO. I just allowed them to travel and they got back. And when (Justice) Secretary (Simeon) Datumanong came back, that HDO was lifted by Secretary Datumanong himself who issued that HDO," she said.
She said the case has been pending before the Court of Appeals after being dismissed by the Ombudsman. (JPM with an additional report from Malacañang)
(February 2, 2005 issue)
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