ROXAS TO PDIC: PAY ONLY LEGITIMATE LEGACY DEPOSITORS

Liberal President Senator Mar Roxas today asked the Philippine Deposit Insurance Corp. (PDIC) to ensure only legitimate depositors of the 13 failed Legacy rural banks owned by businessman Celso de Los Angeles will be paid deposit insurance claims.

Roxas said the PDIC must make sure no one would be paid spurious insurance claims in light of allegations of irregular and fraudulent banking practices by De los Angeles and his bank officers.

"Mahalagang mabayaran agad ang mga tunay na depositors na nalugi dahil sa pagsasara ng mga Legacy banks. Dahil pera ng mamamayan ang ibabayad ditto, mahalagang mabayaran lamang ng PDIC ay ang mga lehitimong depositor ng Legacy (It is important that authentic depositors be paid their lost money. Since public funds will be used to pay the claims, the PDIC must ensure only the legitimate depositors are paid)," he said.

Because public funds would be used for the insurance payments, the government must ensure those involved in the irregularities and fraud that led to the Legacy banks' collapse would be prosecuted and put to jail, particularly its owner De los Angeles, Roxas said.

"Kapalit ng perang ilalaan ng gobyerno galing sa buwis na ibinabayad natin, mahalagang magkaroon ng katarungan sa malaking panlolokong nakita na natin sa iba't ibang imbestigasyon (In exchange for the public funds that would come from our taxes, it is important that justice be meted against those who committed these crimes)," he stressed.

The PDIC had announced it would start paying insurance claims by Legacy depositors before February 14. It had asked the BSP for a P14-billion loan instead of using its own Deposit Insurance Fund because of the huge amount involved.

Under the PDIC charter, each depositor is guaranteed re-payment of P250,000 at most for deposits in closed banks. The insurance was raised to P500,000 under a bill approved by the Senate and the House, but the Legacy banks declared closure before the bill was approved by Congress.

"PDIC has asked BSP for a P14-billion loan, which in reality comes from our taxes. It would be prudent for the PDIC if it makes sure that the deposit insurance claims it pays won't go to fraudulent claimants," the Ilonggo senator said.

The Ilonggo senator noted that even BSP Deputy Gov. Nestor Espenilla publicly admitted that the Monetary Board has yet to determine the extent of the fraudulent banking practices of De los Angeles and his officers.

Roxas reminded the PDIC that the BSP, the Department of Justice, the National Bureau of Investigation, and even both the Senate and the House of Representatives, are still investigating allegations of fraudulent and irregular business practices that led to the collapse of the Legacy group of banks and pre-need plan companies.

The Senate is continuing its investigation into the Legacy group's collapse and the state of the entire pre-need industry under Roxas' trade and commerce committee and Sen. Francis Escudero's banking committee.