Yuchengcos face estafa raps, PEP Coalition readies more charges
The Manila Times
Jan. 31, 2009
By William B. Depasupil, Reporter
Syndicated-estafa charges were filed on Friday before the Department of Justice against 21 executives of an ailing pre-need company owned by the Yuchengco Group of Companies.
The Parents Enabling Parents (PEP) Coalition, led by Victoria Gomez Jacinto, filed the criminal complaint against Pacific Plans Inc., a member of the Yuchengco group, over Pacific Plans’ failure to comply with its commitment to over 34,000 planholders.
The Yuchengcos recently sold their entire shareholdings in Pacific Plans to Abundance Providers & Investments Corp. for P250 million.
Named as respondents in the PEP Coalition’s 40-page complaint were Ambassador Alfonso T. Yuchengco, Helen Yuchengco Dee, Alfonso S. Yuchengco 3rd and Yvonne S. Yuchengco, among others.
Sydicated estafa is a non-bailable offense that carries a penalty of life imprisonment.
Zenaida Ongkiko-Acorda, the lawyer for the coalition, said Pacific Plans and the respondents “defrauded at least 34,000 planholders,” whom they enticed to purchase open-ended educational plans with the assurance that they have the capability to assume the risks inherent in contracts of such nature.
Pacific Plans filed a petition for corporate rehabilitation in 2005 with the Securities and Exchange Commission (SEC) on the ground that it was suffering from financial distress and should be allowed to suspend payments to its planholders.
But the PEP Coalition said the Yuchengco group’s claim of financial distress was “fraudulently self-engineered” and used as a convenient excuse to enable it to evade its contractual obligations to the planholders with maturing contracts.
“It provided a convenient escape from Pacific Plans’ guarantee to pay the tuitions of the planholders irrespective of the cost at the time of the availment,” the complainants said.
To prove its point, the group cited the SEC and the Pacific Plans’ own audited financial statement that both confirmed that the pre-need company was liquid and solvent but that it reneged on its contractual obligations and filed a petition for corporate rehabilitation in 2005.
After its investigation, the SEC stated that Pacific Plans is a “financially stable corporation” and thus “resort to corporate rehabilitation is not necessary.”
The coalition also cited a ruling by the Court of Appeals, dated October 10, 2006, which states: “With these opinions laid down by SEC in its pleadings, it would seem that Pacific Plans is not suffering from any liquidity problems, thus making the petition for rehabilitation completely bereft of merit.”
A Pacific Plans trust fund statement released in 2004 also stated that it was capable of meeting its projected obligations until 2014.
“This [claim of financial distress] only shows that Pacific Plans and its directors and officers have no intention whatsoever to honor their contractual obligations even if they have the means to do so. The 34,000 planholders were, therefore, deceived into buying these open-ended plans by a corporation which had no intention to honor its contractual promise,” the PEP Coalition said.
A member of the coalition, Cornelio Zafra, said that he would be filing a separate criminal complaint for swindling against the directors and officers of Pacific Plans before the office of the city prosecutor of Manila.