By Beting Laygo Dolor, Contributing Editor
The Department of Justice (DoJ) announced last week that charges would be filed against a remittance company and a religious group for their roles in serious financial malfeasance.
Four counts of money laundering were ordered filed against the owners of Philrem Service Corp., listed as a remittance firm, involved in the US$81 million Bangladesh Bank cyber heist in 2016.
The scandal involved one of the country’s top commercial banks, the Rizal Commercial Banking Corp., (RCBC) owned by the Yuchengco family.
Philrem was found to have failed to report questionable transactions to the Anti-Money Laundering Council (AMLC) as required by Republic Act No. 9160, otherwise known as the Anti-Money Laundering Act.
The suspicious transactions involved the RCBC branch along Jupiter St., in Makati City, where funds stolen from the central bank of Bangladesh ended up in fictitious accounts.
The funds were in the Federal Reserve Bank of New York and were electronically transferred to the RCBC branch. The money eventually found their way to the casino industry.
According to the DoJ, Philrem owners Salud and Michael Bautista along with Compliance Officer Anthony Pelejo knowingly transacted with money “that represents, involves, or relates to the proceeds of an illegal activity.”
Since Philrem is involved in quasi-banking operations, its officers are presumed to be aware of their legal obligations, said the Justice department.
Their failure to report what was “a very irregular, if not downright illegal, transaction” on a regular basis meant that they should be charged with money laundering.
Under the AMLC rules, any single bank transaction involving more than PHP500,000 (about US$10,000) per day should be reported to the council.
The RCBC branch manager who facilitated the transactions has since been dismissed and is filing separate charges filed by the bank against her.
Meanwhile, the Justice department last week filed criminal charges against the founder and officers of the Kapa Community Ministry International. They were found by the Securities and Exchange Commission (SEC) of engaging in a Ponzi scheme, masked as an investment program.
The DoJ charged Kapa founder Joel Apolinario, trustee Margie Danao, and corporate secretary Reyna Apolinario for violating the Securities Regulation Code.
The Kapa officials were found to have “willfully, unlawfully and criminally” engaged in the sales and distribution of securities without SEC approval.
Kapa is based in Bislig, Mindanao. Former members had accused the organization of asking “contributions” from its members. In exchange, they would receive interest in their contributions. After the interest stopped coming in, a number of members sought help from the DoJ.
Kapa leaders offered to settle with the former members who filed their complaints, with some even willing to withdraw their legal actions if they received their money back.
Other victims were said to have refused to take legal action against Kapa in fear of retribution. The unknown victims were asked to come forward by the SEC and not be afraid.
SEC Chairman Emilio Aquino said, “We are committed to see the criminal proceedings against Kapa through to the end.”
Aside from the three top officials of the religious organization, the DoJ also indicted Kapa promoters Marisol Diaz, Adelia Fernandico, Moises Mopia and Reniones Catubigan.
Until the three Kapa executives, however the promoters were charged in Rizal province and in Quezon City.
Ponzi schemes — also known as pyramiding — have been around the Philippines for decades, often as small companies offering the usual impossibly high returns to investors.
The situation with Kapa is considered the first time that a religious organization has been involved in the activity, which first appeared in the US East Coast in the 1920s.
One of the biggest Ponzi schemes of all time involved Wall Street investor Bernie Madoff, who pleaded guilty to the crime and is now in prison in a federal penitentiary.