Four months after the arrest of Maria Victoria Lopez, former vice president of Corporate Service Management Division of Metropolitan Bank and Trust Company, the Monetary Board of the Philippine central bank ordered sanctions on the bank for the P1.75-billion (US$34.7 million) fraud she had allegedly perpetrated.
Lopez faces charges of qualified theft through falsification of commercial documents, and falsification of commercial documents, which was a violation of the General Banking Law of 2000.
The 54-year-old executive, who had been with the bank for more than 30 years and was earning P250,000 (US$4,900) per month, allegedly authorized two bogus loans in the name of food giant Universal Robina Corp. so she could issue four cashier’s checks and a promissory note.
In the days following the discovery of the fraud, the publicly-traded bank – second-largest in the country in terms of assets -- lost as much as P14 billion in its market value.
Two other bank employees, Hubert Co and Sue Sai, are accused of conspiring with Lopez. Their lawyer said she had duped them in the same way she had duped the bank.
Lopez was arrested in her office by the National Bureau of Investigation in July in an entrapment operation, after the bank’s Corporate Banking Group found two letters seeking the issuance of two manager’s checks in favour of respondent Co.
Lopez was presented to the media after her arrest and is now detained.
The sanctions, issued on 28 November by the Monetary Board, include:
- Reprimand to suspension of directors and officers who failed to perform adequate oversight and/or have been complacent/remiss of their duties and responsibilities.
- Allocation of approximately P4.45 billion of the Bank’s capital on a consolidated basis to cover for higher operational risk. “The requirement is subject to periodic review and would be lifted when the Bank is determined to have put in place adequate risk control measures to address the weaknesses noted,” the MB said.
- Execution and submission of a Letter of Commitment, to be implemented and completed within one year, to enhance corporate governance, credit administration, internal controls and audit, risk management, and customer on-boarding and monitoring processes.
In determining the appropriateness of the sanctions, the MB took into consideration MBTC’s strong financial condition and immediate corrective actions to contain further financial damage.
In a news release, the MB said it reaffirms the safety and soundness of MBTC with its medium to long term initiatives that will serve to improve governance, controls, and compliance.
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Metropolitan Bank in the Philippines has been penalised for allowing employee fraud to occur.