Enrile accuses Ongpin of insider trading on Philex

Senate President Juan Ponce Enrile on Friday accused businessman Roberto Ongpin of insider trading when he sold 50 million shares of Philex Mining Corp. at 65 percent more than the buying price to business mogul Manuel V. Pangilinan. During Friday's Senate blue ribbon committee hearing on the alleged behest loans given by state-owned Development Bank of the Philippines (DBP), Enrile said Ongpin is guilty of insider trading because he accumulated shares of Philex knowing that Pangilinan intends to buy them at a high price. "Mr. Pangilinan is the buyer, he was the one buying and the one who took advantage of the information if at all is Mr. Ongpin because insider trading means that you took advantage of information that is known to you," he said. In 2009, the DBP extended P660 million in loans to Delta Venture Resources Inc. (DVRI) for the purchase of 50 million Philex shares then under the name of the bank. The shares bought by DVRI at P12.75 per share were registered to Golden Media, Ongpin company, which sold the shares at P21 apiece to Two Rivers the firm affiliated with Pangilinan. Ongpin, Pangilinan, and former DBP president Reynaldo David were all sitting on the Philex board of directors at that time. Ongpin-Pangilinan meeting Enrile explained that before Ongpin bought the Philex shares, the former Trade Minister of the late strongman Ferdinand Marcos first met with Pangilinan. During the meeting, which Enrile said happened between June and December 2009 in Shangri-La, Ongpin supposedly wanted to sell the Philex shares at P27 per share but Pangilinan made a counter-offer to buy at P21. "I understand he (Pangilinan) and Ongpin shook hands and Ongpin started accumulating shares... but he never shared that information. He did not disclose that to the other stockholders of Philex, he alone knew that," he said. "Is this is a negotiated sale? The deal was already made. The only thing [was] the delivery of the shares," the Senate President added. Enrile noted that Pangilinan was not liable to any wrongdoing surrounding the transaction because he was simply the buyer. "He just said this is the price I'm willing to pay," Enrile told reporters in an interview after the hearing. Insider trading is foreknowledge Senator Sergio Osmeña III, chairman of the Senate committee on banks, explained that insider trading is foreknowledge of the price at which shares of stocks would be bought and sold and using such inform for personal gain. "Everybody knew Manny was buying, there was nothing wrong with that, the whole country knew that or anybody who had anything to do with the stock market but they didn't know the price," he said. Insider trading is prohibited under Republic Act No. 8799 or the Securities Regulation Code and is punishable by imprisonment of not less than seven years but not more than 21 years or a fine of not less than P50,000 but not more than P5 million, or both depending on what a court decides. Ongpin earlier denied that the deal was tainted with irregularities. He explained that it was "public knowledge" that Pangilinan wanted to have full control of Philex but that no one knew at what price he was willing to do it. During the last hearing, Ongpin failed to show up, and his lawyer said he was in Europe on business. He promised through lawyer Alex Poblador he will attend the Senate hearings when returns to the country on Oct. 25. David also denies David, who headed the DBP when the loan to acquire the shares were approved, likewise denied that he knew Philex share prices would surge and that Pangilinan intended to buy them. "I can only speak for myself. I did not know," he said. Both Enrile and Osmeña refused to take his word for it. "Mr. David I think you're the only one in this room who will say that you did not know Mr. Pangilinan was buying… Your credibility there is really shot," Osmeña said. Earlier, the Commission on Audit also said there might be possible fraud and insider trading in the deal. — VS, GMA News