PEP Coalition

We fight for truth, justice and good corporate governance!

Plan holders vow to sue Yuchengcos despite sale

Manila Standard Today
Jan. 27, 2009
By Ferdinand Fabella

DISGRUNTLED educational plan holders will file multiple cases of syndicated estafa against the Yuchengco Group including its chairman, Alfonso Yuchengco, over the sale of its troubled pre-need company, Pacific Plans Inc.

The threat of new lawsuits comes as the rest of the industry struggles with the effects of the global financial meltdown. Lawmakers yesterday called for a new investigation of the pre-need business, while Malacañang said it was considering a P1-billion bailout plan for the industry.

The Parents Enabling Parents Coalition said its members would simultaneously file the complaints in courts in Pasay, Makati, Manila and a number of provinces on Thursday in response to what they said was the Yuchengco Group’s continued refusal to honor its obligations to plan holders.

The coalition groups about 3,000 plan holders who bought Pacific Plans’ open-ended educational plans, but were unable to get their benefits when the company became insolvent.

“They diverted the funds, profited themselves, and still reneged on their promise to the plan holders, which is clearly a syndicated estafa,” coalition president Philip Piccio said in a press conference in Pasay City.

Piccio said the Yuchengcos’ decision to sell the company to Abundance Providers and Investments Corp. was their “grand exit plan” to shirk from their responsibilities to clients.

Business tycoon Yuchengco, who heads one of the largest family-owned business conglomerates in the country, would be charged with syndicated estafa along with other Yuchengco Group directors, Piccio said.

The coalition president said they may also sue officials of the Securities and Exchange Commission for their failure to monitor and regulate Pacific Plans and its subsequent acquisition by Abundance Providers.

“We will not stop. We will not relent. We won’t let go,” said Piccio, who has had a four-year legal battle with the Yuchengcos.

“We’ve been charged with 13 [cases of] libel. We have had 13 warrants of arrest. We know we are fighting a Goliath here. We will not stop until our government officials get out of their office and say “enough is enough” and put these corporate giants in jail,” Piccio said.

Despite their hard-line stance on the Yuchengco Group, the coalition was open to talks with the new management of Pacific Plans since the sale had already been consummated, Piccio said.

“They have some proposals and we welcome it. Maybe he has some good intentions,” he said of former Asian Spirit chairman Noel Oñate, whose Abundance Providers acquired the Pacific Plans in December.

Asked if they would impose the same demands on the Oñate-led company, Piccio said they were “flexible” and “we will listen to them.”

Oñate, who started Asian Spirit Airlines with only two small planes in 1995 and sold it last year as the country’s fourth largest carrier, said he was working on a plan to further grow the company.

Pacific Plans, he said, was in good financial stead with consolidated trust fund assets of P12 billion and operating revenues of P1.2 billion.

“With our fresh perspective and focus, we will work with our plan holders initially to ride out the present economic challenges and then further gain strength and momentum moving forward,” he said.

Over in Malacañang, Deputy Spokesman Lorelei Fajardo said the economic managers would discuss a proposal from Senate Majority Leader Juan Miguel Zubiri to allocate a tenth of the P10-billion economic stimulus package for livelihood programs to bail out pre-need plan holders.

Zubiri said hundreds of thousands of plan holders would be hurt if the industry collapsed.

“The Palace is deeply alarmed by the current predicament faced by the pre-need industry,” Fajardo said.

“The Palace… will seriously study and consider the assistance that can be extended to plan holders who stand to lose their hard-earned money.”

But the Makati Business Club rejected the proposed bailout, saying the government should not save an industry that failed due to bad decisions because that may encourage all enterprises collapsing because of irresponsibility and wrong decisions to seek bailouts in the future.

Economic Planning Secretary Ralph Recto said the industry was in need of better regulation.

Saying the Securities and Exchange Commission had “failed miserably,” Recto argued that the task should be turned over to the Insurance Commission.

In the House of Representatives, congressmen filed a resolution to investigate the pre-need industry.

“We cannot risk another CAP [College Assurance Plan] and Pacific Plans fiasco, and we have to move quickly to protect the plan holders,” said Bayan Muna Rep. Teodoro Casiño.

Casiño urged the committee on banks and financial intermediaries to look into statements by the Philippine Federation of Pre-need Plan Companies that the industry was in crisis and experiencing huge losses as a result of the global financial meltdown. With Christine F. Herrera, Joyce Pangco Pañares, Roderick T. dela Cruz


January 27, 2009 - Posted by | Philippine Newspapers/Web News | , , , , , , , ,

No comments yet.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: