Rowena Niña Taduran, representative of the ANTI-CRIME and Terrorism Community Involvement and Support (ACT-CIS) party slate, urged the House of Representatives to investigate the alleged illegal profiteering of certain insiders of the Land Bank of the Philippines (LandBank ) who operate as “agents” or “intermediaries” in loan applications.
Taduran filed House Resolution 2543 asking the appropriate committee to investigate the scheme in which “middlemen” or “agents” offer quick loan approval in exchange for a 10% portion of the loan proceeds.
The resolution was triggered by the complaint of Alberto Ching, president of the American Boulevard Trading Corp., that he had been seduced by the scheme when he applied for a loan of 50 million pesos. Ching said bank insiders have received their “cut” but much of the loan amount has not been released. The businessman was persuaded to apply for another loan of 50 million pesos by the “agents”. However, the loan proceeds were released late and only partially. Accordingly, American Blvd. failed to pay its suppliers and creditors and was forced to close up shop.
Before filing the resolution, Taduran wrote to LandBank officials to look into the matter.
The bank informed her that it had launched an internal investigation and, as a result, had fired the employees involved and brought charges against them. However, LandBank did not offer American Blvd. no compensation for the irreparable damage it has caused.
“Thirty borrowers, more or less, were also victims of this insider scheme by LandBank. Some loans amounted to less than 100 million pesos, while others were well above this amount,” Taduran said. in the resolution.
The legislator thinks that, given the amount of the loans, it is doubtful that the lower level LandBank employees acted without the approval/cooperation of the “superiors”.
Taduran warned that LandBank is a government-owned financial institution and that the scheme, if proven true, will erode public confidence in the banking system.
“Congress has a duty to protect the borrowing public as well as the banking system as a whole from the nefarious practices of unscrupulous banking personnel,” she said.
The Presidential Anti-Corruption Commission said it had begun investigating the matter.
Jesus Hinlo Jr., commissioner of the PACC, said the reports of the illegal banking system are disturbing.
“The allegation of corruption within the largest government bank in the Philippines is very disturbing and as such a motu proprio investigation has been initiated within the PACC,” Hinlo said.