PDIC charges before DOJ 88 pretenders to Legacy accounts

The Philippine Deposit Insurance Corp. (PDIC) charged 88 individuals with estafa before the Justice Department after they supposedly amassed P97.73 million in deposit insurance claims using falsified documents.

 

In a statement Thursday, the state run insurer noted the individuals, led by couple Manu and Champa Gidwani, claimed to be former depositors of the defunct Legacy banks just so they could receive insurance payments.

 

“The fraudulent scheme, referred to as deposit insurance fraud, involved the respondents’ acts of misrepresenting themselves to be the owners of certain deposits; filing claims for deposit insurance and; receiving deposit insurance payments from the PDIC when they are not the true owners of the said deposit accounts maintained with the Legacy banks,” PDIC said.

 

“The Gidwani spouses and the 86 other respondents had maintained 471 accounts in various Legacy banks amounting to P118.19 million. [However,] these accounts were simultaneously opened and funded through checks issued by only one individual or through fund transfers from a single account,” the insurer said.

 

In December 2008, the Monetary Board simultaneously closed 12 banks affiliated with Legacy for engaging in fraudulent banking schemes. Another Legacy bank in Albay, Bicol has been under the receivership of PDIC in 2010.

 

PDIC spent some P12 billion to pay deposit insurance claims made by former depositors of the Legacy banks.

 

“The Legacy banks’ failure is touted as the largest financial scam in the banking system,” PDIC noted.

 

The insurer earlier said the Legacy banks offered very high interest rates on deposits to attract clients, while the officials and owners siphoned off the money through various means. Sometimes the Legacy banks would show that portions of deposits were used to extend loans, but the loans were eventually found to be fictitious, PDIC added. — RRD/VS, GMA News