Two Urban Bank officials cleared of estafa charges

Two former executives of the failed Urban Bank Inc. (UBI) have been cleared by a Makati court of estafa charges filed against them by the Department of Justice (DOJ) in connection with their alleged involvement in the misuse of P2.8 billion in depositors’ money.

Regional Trial Court (RTC) Judge Zeus Abrogar junked the case against former Urban Bank chairman Arsenio Bartolome III and corporate secretary Corazon Bejasa for lack of merit.

In his 10-page decision, Abrogar noted that the prosecution failed to show "probable cause" for filing the complaints against the two respondents.

"No facts and circumstances exist as would excite the belief, in a reasonable mind, that the accused are guilty of the crime for which they are being prosecuted," Abrogar said in his decision.

He noted that Bartolome never even participated or presided in the bank’s credit committee proceedings one year before the bank closed on April 25, 2000.

"Even the prosecution’s claim that it was the relatives of Bartolome who benefited in the transaction was not proven. Thus, it remains mere presumption," the decision stated.

Contrary to the claim of the Bangko Sentral ng Pilipinas (BSP) and the Philippine Deposit Insurance Corp., the lower court ruled that Bartolome’s chairmanship of the board did not place him at the helm with complete control of the day-to-day operations of the bank and its subsidiary, the Urban Investment Inc.

In Bejasa’s case, the court ruled that the evidence clearly showed that she had no knowledge or participation in the questioned transaction.

Abrogar noted that there was no board resolution showing Bejasa’s participation, saying she did not even sign the checks and the transaction tickets.

"The court believes that there is no sufficient ground to engender a well-founded belief that Bejasa is probably guilty of estafa," Abrogar said.

The justice department filed the cases in December last year against 10 UBI officials in the Makati court for alleged conspiracy to embezzle the P2.8 billion.

Senior State Prosecutor Archimedes Manabat and State Prosecutors Josefino Subia and Rosanne Balauag recommended no bail for the respondents, but Chief State Prosecutor Jovencito Zunõ modified the complaint and ruled that the accused could post bail.

The prosecutors argued that the bank officials were liable for swindling when they transferred UBI funds to the bank’s investment house.

"When for no apparent justification at all, funds belonging to the UBI were converted and devoted to a purpose not being beneficial to its clients, the persons responsible therefore should be held accountable," the prosecutors said.

They alleged that the bank officials and employees offered no "logical explanation" for the urgency of the fund transfer which was branded as "highly questionable, if not anomalous," resulting in the declaration of a bank holiday on April 26.

"We find it iniquitous and contrary to human nature and experience that respondents Bartolome and Borlongan negotiated and arranged for BSP financial assistance, while at the same time, busy orchestrating for the purchase of the questioned receivables," the prosecutors said.

Those charged, apart from Bartolome and Bejasa, were UBI president Teodoro Borlongan, senior vice president Nida Santos, senior managers Milagros Santiago, Rowena Punsalan, managers Mark Ching, Chulla Formanes, Amalia Ordas and assistant vice president Loida Payonga.

The BSP and the PDIC claimed that the respondents conspired to misappropriate the P2.8 billion in depositors’ money by investing it in the so-called "garbage transactions" a week before the bank declared a bank holiday.

"The P2.8 billion was used to service the continuing massive withdrawals and pre-terminations of placements of Urbancorp Investment clients and investors, among whom are the relatives of Bartolome, sacrificing and betraying the interest of UBI," the 16-page complaint stated.