Lawmakers blame SEC for pre-need industry woes

MANILA, Philippines - Senators on Monday blamed the Securities and Exchange Commission for the sorry state of the pre-need companies in the country, saying the commission committed "willful negligence and incompetence." "Kung ginawa ng SEC ang kanilang trabaho lalo na nagkaroon ng ganitong pangyayari noong 2004 sa CAP at Pacific Plans, hindi tayo darating dito," said Senator Manuel Roxas II, chairman of the Committee on Trade and Commerce. [“Should the SEC did its job when something like this happened to the College Assurance Plan and Pacific Plans in 2004, this should not have happened."] Roxas believed there is no need to give additional powers to SEC as it already has the widest latitude over pre-need companies. "The SEC was not only negligent but they have been willfully aiding and abetting the defrauding of the people by turning a blind eye, by willfully ignoring all of the signals or signs. They should have been stricter," he said. For his part, Senator Francis Escudero, chairman of the Committee on Banks, Financial Institutions and currencies, said the SEC failed to monitor the state of the trust funds intended to cover the needs of pre-need plan-holders. "SEC has been given the ample power of regulation among pre-need firms. It is there to watch over these trust funds. But they seem to do nothing to protect the investing public. They simply watch as these trust funds dissolve into thin air just like the incestuous relationship of the Legacy Group and its bank subsidiaries," he said. He said the SEC showed incompetence when they could not give categorical answers as to how much will Legacy plan holders get from its trust fund during Monday’s hearing on the pre-need industry’s woes. "This is absurd and disconcerting. We put SEC there to preserve and strengthen the investor's interest but they look like they protect more pre-need companies' interest which is to earn," Escudero said. The senator suggested that the SEC knew about the brewing problems in the Legacy Group since 2004. "We are asking SEC to furnish us a copy of the minutes of their business forum to check if the boiling pre-need problems then were already part of their discussed agenda," said Escudero. He also expressed concern about the allegations of extortion raised by Celso de los Angeles Jr., owner of Legacy Plans, against the Bangko Sentral. He said this is a very serious charge that the BSP should squarely address. "If there is no truth to it, BSP should categorically express so, but if this is true, they should address it head on and sack those who need to be sacked," Escudero said. - GMANews.TV