Press Release
February 12, 2009

ROXAS: PDIC MUST PAY ONLY LEGITIMATE LEGACY DEPOSITORS
GRAFT, MALVERSATION RAPS COULD BE FILED TILL 2024

Liberal President Senator Mar Roxas today warned officials of the Philippine Deposit Insurance Corp. (PDIC) they could be held criminally liable for payment of spurious insurance claims for the 13 failed Legacy rural banks owned by businessman Celso de Los Angeles.

"Mahalagang siguruhin ng PDIC na ang babayaran lang nila ay ang mga lehitimong depositor ng Legacy. Pag may madiskubreng mabayaran na pekeng insurance claim ay siguradong sasabit sila sa kasong graft at malversation (It is important that the PDIC pay only the legitimate Legacy depositors. If it pays any spurious insurance claim, its officials will be liable for graft and malversation)," Roxas said.

He said this warning is important because of the need to protect the interest of legitimate depositors and the taxpayers who are shouldering payment of the insurance claim on the 13 Legacy rural banks that closed last year.

Roxas noted that any PDIC official who would approve fraudulent insurance claims can be charged in court anytime till 2024 if evidence against them is found.

"Ibig sabihin, hanggang 2024 ay maaaring habulin ng gobyerno ang mga opisyal ng PDIC na mapapatunayang nagbayad ng mga pekeng insurance claims. Hindi nila matatakasan ang batas kahit makalusot sila sa ilalim ng administrasyong ito (This means that charges can be filed against PDIC officials until 2024. They cannot escape the long arm of the law even if they escape prosecution under this administration)," Roxas said.

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.

Section 3(e) of the Anti-Graft and Corrupt Practices Act considers it a corrupt practice for a public officer to "cause undue injury to any party, including the government, or giving any party any unwarranted benefits, advantage or preference in the discharge of his official, administrative or judicial functions through manifest partiality, evident bad faith or gross inexcusable negligence."

Violation of the Anti-Graft and Corrupt Practices law prescribes within a period of 15 years from the date when the first settlement is made and is punishable with maximum imprisonment of 15 years.

The Revised Penal Code, on the other hand, mentions that "any public officer who, by reason of the duties of his office, is accountable for public funds or property, shall appropriate the same, or shall take or misappropriate or shall consent, or through abandonment of negligence, shall permit any other person to take such public funds or property, wholly or partially." This prescribes in 20 years.

The senator had previously called on the Bangko Sentral ng Pilipinas and the Securities and Exchange Commission to ensure that De Los Angeles and other Legacy officials involved in the irregularities and fraud that led to the collapse of the Legacy chain of companies are prosecuted and put to jail.

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