Group seeks heavier sanctions vs. RCBC for preneed collapse

MANILA, Philippines- Planholders group Parents Enabling Parents Coalition (PEP) on Tuesday asked the Bangko Sentral ng Pilipinas to slap stiffer penalties against the Yuchengco family and their Japanese partners in connection with the collapse of preneed firm Pacific Plans Inc. PEP accused at least 18 respondents, who were officials of PPI’s trustee bank Rizal Commercial Banking’s trust and investments division, of committing conflict of interest. The BSP has earlier imposed a monetary penalty against RCBC in connection with an earlier complaint filed by the same group which accused the bank of neglecting its fiduciary duties. Philip Piccio, PEP president, said there’s a need for the BSP to slap a heavier penalty against RCBC. Cited in the new complaint were Albert L. Montreal, RCBC Trust officer in 1998, and 1998 trust committee Filipino directors Cesar E. A. Virata, Alfonso S. Yuchengco 3rd , Eduardo S. Lopez Jr, Jose S. Laurel 3rd , Susanne. Y. Santos, Teodoro Q. Pena, and Japanese directors Susumu Imajo, and Ryosuke Tamakoshi. Also cited as respondents were the trust department's 2004 set of officers: Lourdes M. Ferrer (trust officer), Alexandra C. Deveras (asst. vice president); and trust committee directors Alfonso T. Yuchengco, Rizalino S. Navarro, Virata, Francisco S. Magsajo, Jr., Santos, Masaharu Oshima, Koji Onozawa, Teodoro D. Regala, Alfonso S. Yuchengco Jr, Armando M. Median, and Pena. PEP said RCBC should be held liable for conflict of interest for investing PPI’s trust funds to firms which are also owned by the Yuchengco Group. The group noted RCBC used PPI’s trust fund to buy out the investment of Philippine Long Distance Telephone Co. in Uniwide Holdings, which is under rehabilitation. PEP said that the RCBC Trust act of putting the trust fund into another Yuchengco Group-invested company is an interest transaction “absolutely prohibited" by the General Banking Law and the BSP regulations While the trust fund was invested in PLDT stocks, between 2002 and 2004, the investment was unable to earn in contrasts to the annual insurance and related fees that the Yuchengco Group received from the telecommunications giant for various transactions it had with the conglomerate. In particular, PEP noted that PLDT paid a total of P1.52 billion in insurance premium for three years. The buy out of PLDT Retirement Fund from Uniwide has also increased the exposure of the Trust Fund to Uniwide to P40 million, a move which sacrificed the preneed to relieve the PLDT Retirement Fund of a non-performing investment. “The rationale for the preferential treatment... is easy to understand against the backdrop of the substantial shareholdings of Yuchengco Group in the insurance business it enjoys with PLDT through Malayan Insurance Co. Inc.," PEP said. PEP said these acts of RCBC Trust gave unwarranted benefits, advantage and preference to the Yuchengco Group, causing material loss or damage, and exposing the trust fund to abnormal risk. GMANews.TV