MANILA, Philippines - Mayor Celso de los Angeles Jr. of Sto. Domingo, Albay and his associates are facing more criminal complaints linked to the shutdown of several rural banks and pre-need firms belonging to the Legacy Group of Companies.
In two complaints, the Securities and Exchange Commission (SEC) asked the Department of Justice (DOJ) to indict De los Angeles and other officials of Shining Armour Properties Inc. and Conventional Realty Corp. for alleged violation of the Securities Regulation Code and the Corporation Code of the Philippines.
“Taken as a whole, it appears that respondent Shining Armour acted as business conduit of Legacy Consolidated Plans Inc. in its grand scheme to defraud the investing public,” read the first complaint.
“In issuing postdated checks to investors, Shining Armour served as the final piece of the puzzle to complete the elaborate and fraudulent activities of Legacy.”
The SEC also accused officials of Conventional Realty Corp. of “acting as the business conduit” of Legacy Consolidated Plans Inc. in “a grand scheme to defraud” the investing public.
“There was a commonality in the modus operandi in the companies involved where there was a patent unity of purpose or design in their concerted solicitation efforts,” read the second complaint.
Named respondents in the complaints are De los Angeles, his wife Ma. Concepcion, son Martin Nicolo, brother Victorino, mother Purita, and Legacy officers Namnama Pasetes, Raychell Baldovino, Roy Hilario, and lawyer Christine Limpin.
They were accused of selling unregistered securities and engaging in misrepresentation by assuring investors that the principal amount of their investments is guaranteed.
Earlier, the SEC accused De los Angeles and officials of other Legacy firms of engaging in a “double-your-money” program to entice investors with promises of unusually large gains.
Under the program, investors will supposedly double their investment in three years and immediately get 10 percent of the plan’s maturity value.
The balance of 90 percent will be paid in 12 equal installments through postdated checks issued by Legacy Consolidated Plans, one of three pre-need firms under the Legacy Group.
Only the first three or four of the 12 checks issued by Legacy were funded, according to investors.
De los Angeles was tagged as the mastermind behind the schemes that led to the collapse of the Legacy Group which comprised 13 rural banks and affiliate firms Legacy Consolidated Plans, Scholarship Plan Phils., Legacy Card Inc., One Realty Corp., Galaxy Realty and Holdings Inc., Legacy Consolidated Asset Holdings Inc., Fusion Capital Corp., and Legacy Motors Inc.
Among the rural banks were Rural Bank of Parañaque, Rural Bank of San Jose (Batangas), Rural Bank of Carmen (Cebu), Pilipino Rural Bank, Philippine Countryside Rural Bank, Rural Bank of Calatagan (Batangas, now Dynamic Rural Bank), Rural Bank of DARBCI, Rural Bank of Kananga (Leyte, now First Interstate Rural Bank), Rural Bank of Bisayas (Minglanilla, Cebu, now Bank of East Asia), and San Pablo City Development Bank.
These banks reportedly offered returns of as much as 30 percent per annum on huge deposits and misused collateral surrendered by clients.
The Bangko Sentral ng Pilipinas has filed complaints against officers of Legacy’s rural banks after discovering alleged “massive diversion of funds” through fictitious loans.
It found that many of the banks’ borrowers denied having obtained loans from the closed banks, while others admitted having signed blank documents in consideration of commission fees ranging from P10,000 to P15,000 for supposed loans amounting to millions of pesos.
Yesterday, the Court of Appeals (CA) was asked to freeze another 1,177 bank accounts supposedly used by the Legacy Group of Companies to victimize hundreds of investors and pre-need plan holders.
In a manifestation, the Office of the Solicitor General (OSG) asked the CA’s former special third division to extend the 20-day freeze on the accounts that was supposed to expire on April 16.
State Solicitor Hermenegildo Dumlao II said they sought extension of the freeze order because the 20-day period was not enough for the Anti-Money Laundering Council (AMLC) to look into all bank accounts covered by the order.
“We asked for the extension because the AMLC needed additional time to conduct its investigation, considering there are 1,177 accounts (that) have been identified and we have to go through these one by one and the web of related accounts,” he said.
One of the respondents, Legacy officer Monina Vierneza-Dio, filed a petition seeking to lift the freeze order.
Lawyers of the respondents also questioned why they were not given copies of the OSG’s petition seeking issuance of the freeze order.
Lawyer Gregorio Batiller, counsel for Victorino de los Angeles – Celso’s brother – said that they could not defend their clients properly without knowing where the petition was based.
However, Dumlao said they did not want the petitioners to be notified to prevent withdrawal of funds from the questioned bank accounts.
“They (respondents) have a mistaken belief that they are entitled to a copy of a petition for the issuance of the 20-day freeze order,” he said. “The whole point of the ex-parte petition is to prevent the accounts from being withdrawn.”
Ruling on the issue, the CA ordered the OSG to provide copies of the petition to the respondents within five days.
The next hearing on the petition to freeze the Legacy accounts was set for April 27.