A municipal trial court has convicted former Lapu-Lapu City Mayor Paz Radaza, who was also former president of the Rural Bank of Subangdaku, Inc. (RBSI), and 18 of its past employees in connection with the P2.6-billion worth of ‘dubious’ loans processed by the bank between 2004 to 2008.
Radaza and her co-accused were found guilty of 34 counts of falsification of public and commercial documents, based on the June 7 decision of the Municipal Trial Court in Cities (MTCC) Branch 2 in Mandaue City, where RBSI is located.
The Department of Justice (DOJ) announced this development on Monday, July 1, acknowledging the efforts of state prosecutors who helped secure the guilty verdict.
“This conviction demonstrates our firm resolve to go after those who defy our laws to the prejudice of our financial institutions and the general public, as well,” Justice Secretary Jesus Crispin Remulla said in a statement.
The accused face an indeterminate penalty of one year and one day imprisonment as minimum up to three years, six months and 21 days as maximum. They are also fined P3,000 “with subsidiary imprisonment in case of insolvency.”
A copy of the decision was not immediately available. The DOJ also did not state whether those convicted were imposed civil liability.
The DOJ said the case stemmed from a complaint filed before the department by the Philippine Deposit Insurance Corporation (PDIC), which conducted an investigation after RBSI declared a bank holiday early in 2009.
“Account holders of the bank tried to withdraw their money after RBSI’s declaration of bank holiday, but were too late after the bank denied the same due to alleged lack of financial capability,” the department said.
The MTCC ruled that the bank officers/personnel involved “made it appear that certain individuals obtained loans from RBSI when, in truth and in fact, they never did nor even participated in the preparation of the documents related thereto.”
The DOJ said prosecutors “sufficiently established the participation and probable guilt of all the accused” in the fabrication of several documents, while the defense “failed to persuade the court of their innocence” due to lack of clear and substantial evidence.
The court also pointed out in its decision that “the chain of events surrounding the involvement of all the accused were all supported by tangible proof,” according to the DOJ.
Editor’s Note: This is an updated article. Originally posted with the headline “Local court finds 19 rural bank employees in Mandaue City guilty of fraud.”