Tanco withdraws PSE board nomination

MANILA, Philippines — Businessman Eusebio Tanco, director of the Philippine Stock Exchange,  has decided to withdraw from the upcoming elections of the PSE board this July 1 despite earlier being nominated for director.

In a June 16 letter to PSE chairman Jose Pardo, Tanco said he was withdrawing his nomination as director, citing delicadeza amid issues raised against his brokerage company, Ventures Securities Inc. (VSI), which he said were “unjustified.”

“Recent events which, unfortunately and unjustifiably, have besmirched the reputation of Ventures Securities and its officers and employees compel me, out of delicadeza, to decline the nomination for membership in the board of the exchange,” Tanco said in his letter.

Pardo, for his part, said, “he (Tanco) decided that it was best for him to withdraw his candidacy. In short, he decided to take the moral high ground and not put at risk the reputation of an institution he holds in high esteem… the PSE.  All the more admirable because it was a decision he made  without knowing the outcome of Nomelec’s decision. Truly laudable and a noble act.”

The nomination period for the PSE’s elections ran from April 29 to May 14.  After which, a list of candidates including Tanco was published on the website.

In the same letter to Pardo, Tanco said VSI intends to contest the findings of the special hearing panel of the Securities and Exchange Commission (SEC) which ordered the revocation of the license of VSI in connection with its alleged role in the anomalous transactions of people connected with of R&L Investments.

“The investigation into the anomalous conduct of one Marlo Moron of R&L Investments has unnecessarily dragged Ventures Securities. Records show that Mr. Moron, acting as both trader and settlement clerk, in violation of the SEC rules for a brokerage firm, executed EQ trades indicating that he has the access code of R&L Investments to utilize the PCD system,” Tanco said.

“Ventures was never involved in the fraudulent scheme of Mr. Moron and R&L and is, therefore, as much a victim as the clients of R&L,” Tanco pointed out.

The SEC, for its part, announced yesterday that it upheld the findings of the Philippine Stock Exchange’s independent audit, surveillance and compliance arm that Venture Securities violated multiple trading rules in facilitating transactions that eventually wiped out client shares in R&L Investments, Inc.

In a decision dated June 15, the Commission en banc denied the appeal of VSI to reverse and set aside the resolution issued by Capital Markets Integrity Corp. (CMIC), which found the stock brokerage in violation of the self-regulatory organization’s rules and imposed a corresponding penalty of P5.16 million.

CMIC issued the assailed resolution on July 10, 2020 following the discovery of fraudulent transfers of client shares from R&L to the account of a certain Julieto Sulapas in VSI.

The SEC likewise revoked the license of R&L Investments and imposed monetary penalties totaling P25 million against the brokerage, its key officers and the client involved in the fraudulent scheme that led to the collapse of one of the country’s oldest stock brokerages.