NextGen Day

MANILA, Philippines — The Land Bank of the Philippines (Land Bank) has warned the public that fraudulent tactics will not be tolerated, as it launches an investigation into the suspected illicit profiting of some bank officials who act as “go-betweens” or “agents” in loan applications.

The government-owned bank made the statement in response to House Resolution 2543, which was introduced by ACT CIS party-list Rep. Rowena Nia Taduran, calling for a congressional investigation into the loan scheme in which these agents promise quick approval in exchange for a 10% cut of the loan proceeds.

“The Land Bank of the Philippines is investigating the purported loan scheme made by the president of the American Boulevard Trading Corporation (American Boulevard),” the bank said in a statement released on Wednesday.

Taduran used the example of American Boulevard president Alberto Ching, who sought a PHP50 million initial loan, in her ruling.

She claimed that despite the LBP insiders receiving their 10% cut, a considerable portion of the loan sum was not released to Ching.

Land Bank, for its part, noted that when it comes to providing and administering loans, it follows strict vetting procedures based on its current policies and all other relevant banking rules and regulations.

It went on to say that the company maintains strong ethical standards in the workplace and that any violations by its personnel will be regarded “extremely seriously.”

“The Bank informs the public that fraudulent practices contrary to its 58-year-old brand of public service, anchored on integrity, openness, and accountability, will not be tolerated,” it stated.

According to Taduran, Ching’s company defaulted on payments to suppliers and other creditors, resulting in the company’s liquidation and the loss of livelihood of its employees.

The congressman filed a letter to the LBP management, requesting that they investigate Ching’s situation.

According to Taduran, the bank launched an internal investigation and fired the workers implicated, as well as filing criminal charges against them.

She did remark, however, that LBP did not give any compensation to American Boulevard for the “irreparable damage” it had suffered.

She also named 30 other debtors who were victims of the LBP insiders’ lending scheme, with loans ranging from PHP100 million to much more than that amount.

“Given the size of the loans, it’s quite unlikely that low-level LBP workers acted without the approval/cooperation of the ‘higher-ups,'” she stated.

The scale of the loan amounts involved, the involvement of a government-owned financial institution, and the potential effect on the public’s trust in the banking system, according to Taduran, make it necessary for the House to investigate this subject.

“Congress has a responsibility to protect the borrowing public as well as the broader banking system against nefarious bank workers,” she said.

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