3-year tuition freeze mulled
The Philippine Star
Feb. 23, 2009
by Jess Diaz
MANILA, Philippines – The House of Representatives warned private schools, colleges and universities yesterday that it will freeze tuition for three years if they increase their fees this year.
Speaker Prospero Nograles said he would support the proposal of Rep. Teodoro Casiño of the party-list group Bayan Muna for a “legislated three-year freeze on tuition” if school owners “will refuse to heed the clamor for a tuition increase moratorium.”
“We can only appeal for compassion at this time, but I am keeping an open mind for this option of a legislated three-year moratorium on increases in school fees,” he said.
He joined concerned colleagues, parents and students in pleading with private and public schools not to collect additional tuition this coming school year and until the global economic crisis is over.
“This is the worst time to increase tuition fees. A lot of people are now losing their jobs and can hardly send their children to school so I strongly suggest that school owners and administrators should call off any plan to increase fees as part of their contribution in the effort to mitigate the effects of the global financial crisis,” he said.
Aurora Rep. Juan Edgardo Angara aired a similar appeal.
“Any tuition fee hike at this time will only aggravate the dire situation that most parents are experiencing right now,” he said.
He said he has information that this early, more than a dozen schools plan to increase tuition.
Nograles said school owners who decide to collect additional fees despite the crisis would face interrogation by congressmen.
He said the House would not hesitate to call them to explain such decision.
“It is inherent for Congress to exercise its oversight powers when it involves public interest which includes tuition fee increase. The House of the People will not hesitate to use this power to find justification on any increase in tuition and other school fees,” he said.
Angara, on the other hand, said the House should look into where proceeds from previous tuition increases were used.
He said the law required that 70 percent of new fees be set aside for salaries and other benefits of faculty and non-academic personnel and 20 percent for modernization of school facilities.
He said congressmen should find out if the required allocations were followed.
At the same time, Nograles, who has over 4,000 scholars in his district, appealed to his peers in Congress to expand their scholarship programs to avert a further increase in the number of students who cannot enroll this school year.
“This possibility of tuition fee increase this coming school year has far-reaching effects on the country’s social ills, including peace and order. We should do everything to help those who are willing to finish their studies but cannot afford paying their tuition fees,” he said.
Good pre-need law urgent…not constitutional change
Instead, our congressmen are laboring to change the Constitution.
On Feb. 15 last year, about 10,000 farmers, students, professionals and workers were on the streets of Makati asking the President to step down.
The issue was the alleged big kickback behind the Philippine National Broadband Network (NBN-ZTE) project where the whistle-blower was “kidnapped” and his life threatened.
President Macapagal-Arroyo and her husband were among those allegedly involved in the NBN-ZTE project worth $329.5 million or P16.5 billion.
Corruption charges
Gloria is perceived by many to have cheated massively in the 2004 elections and, therefore, an illegitimate president amid the worsening series of corruption charges.
Last week’s Senate hearings were focused on World Bank (WB) reports implicating high-ranking officials including the President’s husband in the reported corruption in WB-funded projects.
A recent survey revealed that this administration is the most corrupt in the nation’s history.
Many are waiting for the 2010 presidential elections as a constitutional deadline to end Gloria’s illegitimate tenure.
However, there are signs that Gloria wants to remain in power after 2010.
Last Friday, the Speaker of the House together with the majority of Congressmen sponsored House Resolution 737: Resolution Proposing Amendments to Sections 2 and 3, Article XII of the Constitution to Allow the Acquisition by Foreign Corporations and Associations, and the Transfer or Conveyance Thereto, of Alienable Public Lands and Private Lands seeking to allow foreign entities to own lands not exceeding 25 hectares, and to explore and develop the natural resources through joint venture
or production sharing arrangement.
Purportedly, this is to attract foreign investment.
I am strongly against this move now because once the resolution is on the floor, the whole Constitution will be opened to amendments.
Amendments
There is no limit to possible amendments, including extending the term of office of elected officials, granting the President permanent immunity from prosecution, or even changing the form of government to parliamentary for Gloria to stay in power.
Recently, I started sending text messages to some Congressmen including House Speaker Prospero Nograles explaining my dismay. “Why is it important to you now to amend the Constitution? Why now? Can’t it wait after 2010 presidential elections?”
Nograles answered and invited me to join the public hearing. So I told him that I am currently studying at the KSG Harvard but still continuing to be involved in our nation’s affairs.
I pointed out to him that one of the pressing issues is the agony of pre-need victims. He is also a victim of the Legacy Group according to newspaper reports.
Like Legacy, other defunct pre-need companies collected money from parents or retirees with the promise to pay future college tuition fees of their children or retirement benefits. But it declared bankruptcy when the contractual benefits started to be paid.
His next reply was they are studying it. Still studying it? Better to act now!
It is urgent to study the collapse of more than 50 pre-need companies in the last seven years; the original pre-need bill which was filed in 2003, intermittently discussed in Congress and lost its essence because of strong lobby of the industry federation; neglect of Securities and Exchange Commission (SEC) in establishing rules and regulations that could have prevented the collapse of pre-need companies; mismanagement of pre-need trust funds; wrong practices of accountants and pre-need actuaries and irresponsible and unprofessional management.
Unsound pre-need firms
Had Congress timely acted on these, unsound pre-need companies would have been closed and would not have victimized more parents or retirees who lost hard-earned life savings for the college education of their children and retirement.
Nograles gave comforting assurance that Congress will return the money of pre-need victims.
I retorted: “Where are you going to get the money? Are you aware that the biggest company, CAP, has a fund deficiency of more than P15 billion in 2005? How much would it be if Pacific Plan, Legacy and 50 more closed pre-need companies are included? Where will you get more than 10 percent of our GDP to just return the money entrusted by the victims to pre-need companies? Not from our budget, which is still in deficit despite selling of government assets?”
Please, Congress, drop the Constitutional change for the meantime.
Focus now on crafting a really good pre-need law. See how pre-need victims can be compensated equitably; and punish the culprits.
Give hope to our future!
(This article reflects the personal opinion of the author and does not reflect the official stand of the Management Association of the Philippines. The author is a former insurance commissioner and SEC volunteer-actuary. Feedback at map@globelines.com.ph. For previous articles, please visit .)
House probe on Legacy, pre-need firms losing steam?
The Philippine Star
Feb. 22, 2009
by Jess Diaz
MANILA, Philippines – Is the inquiry of the House of Representatives into the bankruptcy of the Legacy Group of banks and pre-need companies of Celso de los Angeles losing steam?
This is the question congressmen are asking after the committee on banks and financial intermediaries failed to schedule a hearing this week.
One congressman, who did not want to be identified, said the House should not be seen as losing interest in De los Angeles, or worse, covering up for him.
In talks with reporters last Monday, Manila Rep. Jaime Lopez, committee chairman, said he did not set a hearing because of the unavailability of a meeting room.
“All the hearing rooms have been reserved by other committees,” he said.
However, the schedule of committee meetings for this week showed that while most rooms are reserved, the Andaya Hall, the biggest conference room in the House, was occupied only last Tuesday morning and afternoon.
The ways and means committee met in the hall named after the late Camarines Sur Rep. Rolando Andaya Sr. in the morning, while in the afternoon, it was occupied by the committee on constitutional amendments.
It was free for use by any committee on Monday and the rest of the week.
The Lopez panel held its last hearing on De los Angeles and his Legacy mess last Feb. 9. It is scheduled to resume its inquiry today, Feb. 23, after almost two weeks.
Albay Rep. Edcel Lagman said he asked Lopez to hold daily hearings next week since lawmakers are about to go on their month-long Holy Week break.
Earlier, Lagman complained about the long gap in the inquiry, saying the committee is not able to sustain its momentum in finding out what happened to the failed Legacy Group of 12 rural banks and three pre-need companies.
He said the committee should have questioned De los Angeles on Feb. 11 when he showed up for its hearing.
The Legacy owner-founder went home after being told by Lopez’s staff that the hearing would be on Lopez’s bill seeking the creation of a Philippine Pre-need Insurance Corp. (PPIC) and that he was not among the resource persons invited.
“We should have questioned him simultaneously with our discussion on PPIC,” Lagman said.
In a letter to The STAR, Lopez clarified that it was not he who sent De los Angeles home on Feb. 11.
“The truth is that on that scheduled committee meeting, I never saw Mr. De los Angeles. So how could I possibly send him away?” he said.
“In any case, the committee will continue with the investigation of the closed rural banks and pre-need companies and dig deeper into the causes of the closures in aid of legislation,” Lopez said.
Legacy owner shows up at House, is sent home
The Philippine Star
By Jess Diaz Updated February 12, 2009 12:00 AM
MANILA, Philippines – The owner of the failed Legacy Group of rural banks and pre-need companies, Celso de los Angeles, showed up yesterday for a scheduled House committee hearing, only to be sent away by the panel’s chair who made an eleventh-hour decision to tackle instead his own proposed bill.
Manila Rep. Jaime Lopez’s decision to send De los Angeles home angered his colleagues in the House committee on banks.
De los Angeles has been implicated in yet another controversy – the sale of mortgages for the housing units of 52,000 families who are about to lose their dwellings.
The alleged sale took place when he was head of the National Home Mortgage Finance Corp. (NHMFC) in 2004.
Albay Rep. Edcel Lagman said it was their agreement last Monday, when the committee delved into the closure of the Legacy banks, that they would continue grilling De los Angeles yesterday.
“I rushed here from another meeting only to find out that Mayor De los Angeles has been sent home. That was not our understanding on Monday,” he told Lopez.
The Legacy founder-owner is mayor of Sto. Domingo, Albay. The town is part of Lagman’s district.
Lopez said he decided that the hearing focus on his bill proposing the creation of the Philippine Pre-need Insurance Corp. (PPIC).
He informed Lagman that he would schedule another hearing on Legacy next week.
Lagman complained that the House inquiry into De los Angeles and his companies appears to be losing steam.
“We are not able to sustain it. Now there will be a one-week delay before we can get to question him again. We should have taken advantage of his presence and continued grilling him here today simultaneously with our discussion on the PPIC bill,” he said.
He called Lopez’s attention to newspaper editorials and comments that congressmen seemed to be rushing to bury the “carcass” of the Legacy mess.
Representatives Carlos Padilla of Nueva Vizcaya and Elpidio Barzaga Jr. of Cavite said they were disappointed with the committee’s decision to spare De los Angeles from taking the hot seat yesterday.
Padilla, the first congressman to arrive at the hearing room, said he expected the hearing to be a continuation of last Monday’s inquiry.
He said he went to another committee hearing when he learned of Lopez’s decision on De los Angeles.
Last Monday, Padilla asked Lopez whether the inquiry would cover both Legacy’s banks and pre-need companies.
The committee chairman replied that they would first delve into the failure of the rural banks and tackle the closure of the pre-need companies later in the day.
“If we cannot cover both today, we will continue the hearing on Wednesday,” he said.
Another congressman, who asked not to be named, warned the Lopez committee against being perceived as “soft on, or worse, covering up for De los Angeles.”
“They should remember that the Speaker has been dragged into this mess,” he said.
He was referring to claims by former Philippine Deposit Insurance Corp. president Ricardo Tan that Speaker Prospero Nograles, as majority leader in 2005, asked him to go slow on De los Angeles and his Legacy Group.
The PDIC was already investigating the precarious condition of Legacy’s rural banks at the time.
Nograles denied intervening for De los Angeles and said he himself was a victim of Legacy and that he was still trying to collect millions from the group.
The Legacy owner acknowledged in a Senate inquiry that he still owes the Speaker P10 million.
Brewing controversy
Rep. Luzviminda Ilagan of the party-list group Akbayan said De los Angeles appears to be involved in another controversy – the sale of mortgages for the housing units of 52,000 families that are about to lose their dwellings.
She said during the Legacy owner’s time as head of the National Home Mortgage Finance Corp. (NHMFC) in 2004, the agency sold P13.45-billion worth of housing mortgages to Balikatan Housing Finance Inc.
She said Balikatan turned around and sold the same mortgages to Philippine Savings Bank, which is now trying to foreclose the housing units.
In last Monday’s hearing, Ilagan asked De los Angeles about the transaction.
But De los Angeles claimed the sale was made before his appointment as NHMFC head. “I just implemented it,” he said.
Hold order
Immigration Commissioner Marcelino Libanan has issued a hold departure order against De los Angeles and 11 others in connection with the Legacy investigation.
Placed in the hold order list aside from De los Angeles were Virgilio Odejar, Marcos Ong, Zacarias Carticiano, Teodoroa Comple, Jose Girlo Caramat, Roy Hilario, William Escalante, Romarico Tanedo, Ernest Jurado Sr., Joey Corpuz and Emilio Aguinaldo IV.
Libanan said that the issuance of the hold departure order was in compliance with the directive of Justice Secretary Raul Gonzalez.
The order, Libanan said, “is in relation to the investigation of the Bangko Sentral ng Pilipinas on at least 14 banks and other companies affiliated with the Legacy Group,” Libanan said.
Senator puzzled
Senate President Juan Ponce Enrile wondered why authorities couldn’t seem to have De los Angeles jailed despite the many complaints of fraud against him.
Enrile likened De los Angeles to alleged investment scam artist Bernard Madoff, who was charged for defrauding American investors of $50-billion through pyramiding or a Ponzi scheme.
Senators grilled officials from the Securities and Exchange Commission for their failure to detect and stop De los Angeles’ dubious business early enough.
Sen. Manuel Roxas II said De los Angeles must be enjoying some protection to be able to have escaped scrutiny from authorities.
De los Angeles’ assets – an estate in Cebu, four luxury cars worth P8 million and a yacht, M/V Legacy – have remained intact instead of frozen. De los Angeles said he had sold his other house in Ayala Alabang in Muntinlupa and his assets were valued at P100 million.
Roxas also asked the PDIC to ensure that only legitimate depositors of the 13 failed Legacy rural banks would be paid deposit insurance claims.
“It is important that authentic depositors be paid their lost money. Since public funds will be used to pay the claims, the PDIC must ensure only the legitimate depositors are paid,” he said.
“In exchange for the public funds that would come from our taxes, it is important that justice be meted against those who committed these crimes,” he stressed.
The PDIC announced earlier it would start paying insurance claims by Legacy depositors before Saturday. It had asked the BSP for a P14-billion loan instead of using its own Deposit Insurance Fund because of the huge amount involved.
“PDIC has asked BSP for a P14-billion loan, which in reality comes from our taxes. It would be prudent for the PDIC if it makes sure that the deposit insurance claims it pays won’t go to fraudulent claimants,” Roxas said.
Roxas noted that even BSP Deputy Governor Nestor Espenilla publicly admitted that the Monetary Board has yet to determine the extent of the fraudulent banking practices of De los Angeles and his officers.
SC vows help
The Supreme Court will give “utmost attention” to an administrative complaint being readied by opposition Rep. Rufus Rodriguez against three Court of Appeals justices and a Manila judge for their alleged move to prevent the BSP from closing the Legacy Group’s 12 ailing rural banks last year.
“That is the prerogative of Congressman Rodriguez. We appreciate the move of Congressman Rodriguez to conform to the judicial system. Rest assured that this will be given utmost attention,” SC spokesman Jose Midas Marquez said.
Facing administrative charges are CA Justices Apolinario Bruzelas Jr., Bienvenido Reyes and Mariflor Punzalan-Castillo, and Manila Regional Trial Court Judge Nina Antonio Valenzuela.
Rodriguez earlier said the justices and the Manila judge violated the New Central Bank Act when they stopped the BSP from closing the troubled banks.
Rodriguez said it was Valenzuela who issued a temporary restraining order on the BSP in May 2008 upon the petition of the Legacy Group.
The three justices, who are members of the appellate court’s 8th division, later upheld the TRO, he said.
Last December, the SC reversed the lower court’s TRO, enabling the BSP to finally close Legacy’s rural banks. – With Aurea Calica, Evelyn Macairan, Edu Punay
House to inquire into pre-need firms
The Philippine Star (taken from Yahoo! News Philippines)
Jan. 27, 2009
MANILA, Philippines — The House of Representatives will conduct an inquiry into the state of pre-need companies, which are business entities selling education and pension plans and similar products.
The inquiry was prompted by a resolution filed by several members of the House minority led by Bayan Muna Rep. Teodoro Casino.
“There is a need to look at the pre-need industry so we can propose measures to protect hundreds of thousands of plan holders,” Casino said.
He said despite the failure of College Assurance Plan Inc. (CAP) three or four years ago, the government was unable to prevent other pre-need companies from collapsing.
He said the closure of several pre-need firms has left plan holders holding onto a proverbial empty bag.
Just three weeks ago, three pre-need companies belonging to the Legacy group closed shop after the Bangko Sentral ng Pilipinas (BSP) padlocked the group’s 12 rural banks for alleged unsound banking practices.
Legacy plan holders now do not know what to do with their plans. Many of them are filing complaints with the Securities and Exchange Commission (SEC).
Lawmakers have urged the authorities to apply the full force of the law on Legacy owners led by politician-businessman Celso delos Angeles.
Casino said the inquiry would also look into the failure of BSP and SEC to protect the public.
– By Jess Diaz (Philstar News Service, www.philstar.com)
House to inquire into pre-need firms
The Philippine Star
By Jess Diaz
Updated January 26, 2009 05:08 PM
MANILA, Philippines — The House of Representatives will conduct an inquiry into the state of pre-need companies, which are business entities selling education and pension plans and similar products.
The inquiry was prompted by a resolution filed by several members of the House minority led by Bayan Muna Rep. Teodoro Casino.
“There is a need to look at the pre-need industry so we can propose measures to protect hundreds of thousands of plan holders,” Casino said.
He said despite the failure of College Assurance Plan Inc. (CAP) three or four years ago, the government was unable to prevent other pre-need companies from collapsing.
He said the closure of several pre-need firms has left plan holders holding onto a proverbial empty bag.
Just three weeks ago, three pre-need companies belonging to the Legacy group closed shop after the Bangko Sentral ng Pilipinas (BSP) padlocked the group’s 12 rural banks for alleged unsound banking practices.
Legacy plan holders now do not know what to do with their plans. Many of them are filing complaints with the Securities and Exchange Commission (SEC).
Lawmakers have urged the authorities to apply the full force of the law on Legacy owners led by politician-businessman Celso delos Angeles.
Casino said the inquiry would also look into the failure of BSP and SEC to protect the public.
Feature: The collapse of pre-need dreams
Philippine Information Agency
May 12, 2006
By Rose B. Palacio
Davao City (12 May) — Councilor Pilar C. Braga authored a resolution urging the House of Representatives to fast-track its congressional hearing regarding pre-need companies which have declared financial losses, the biggest of which is the College Assurance Plan (CAP) which started the pre-need craze.
CAP have sold educational plans to parents believing that the money invested (by these parents) are actually ”investments”, not a lay-away fund paid in trust.
Parents have “invested” in these pre-need companies because they would like their child to finish a college education – and so parents prepared an advance education by depositing money in the said pre need companies.
Councilor Braga said, the controversy has mounted when these pre-need companies declared financial losses and stopped issuing payments to the planholders.
The hard money earned by parents have been mismanaged by these pre-need companies, misused or simply malversed.
According to councilor Braga, there are seven pre-need companies which declared financial losses and the Davao City Council is urging the House of Representatives to fast-track the congressional hearings because of the repeated failed promises of these companies led by CAP to release payments for the tuition expenses of the planholders’.
Over a million planholders met and formed a national coalition to force the hand of these pre-need companies to pay the amounts needed by their children to continue their schooling”
The coalition, called the First National Assembly of Pre-Need Victims bewailed what it called as a conspiracy between government officials and instrumentalities and pre-need companies.
The coalition accused the Securities and Exchange Commission of refusing to use its powers to file criminal case against pre-need companies. (PIA)
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Your Say on the Matter....
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This site is a public service for PEP Coalition planholders as well as for the public who may be looking for information on the pre-need industry and the PEP Coalition's quest for justice in the courts. We also scour the internet for past and present articles on the industry and specific pre-need companies in an effort to provide ready access to everything written about the pre-need industry in a central area (our site). Each news article contains the source, publish date, and where available, a link back to the actual news site. If you have a reaction to a specific article posted, you may click on Comments link found at the bottom of each post.
