Perfecto Yasay Jr. prematurely ends his tenure today as chairman of the Securities and Exchange Commission. The administration, which has been trying to kick him out since Day One, did not have to drag him screaming and kicking out of his office. But Yasay, who packed up at the SEC yesterday, isn't going quietly. Testifying at the House of Representatives, Yasay said President Estrada had asked him, in one of several controversial telephone conversations last year, to clear Best World Resources Corp. president Dante Tan of insider trading and manipulation of BW stocks. Instead, the President wanted to pin the blame on stock broker Wilson Sy, Yasay said. The President responded by calling Yasay a congenital liar.
Why was this detail about Wilson Sy, former president of the Philippine Stock Exchange, left out of Yasay's previous testimonies? Because, Yasay explained, he was never asked about Sy. Yasay's latest bombshell was dropped two days after the President accused him of asking P1 million from Tan -- a charge Yasay denied.
These charges and counter-charges will continue to erode confidence in the Philippine stock market in the months to come. Much will depend on the outcome of the separate probes of the BW case. Yasay is leaving a stock exchange in shambles, with the SEC's regulatory functions seemingly hobbled by Malacañang. Some quarters are warning that even with the demutualization of the Philippine Stock Exchange, which will open the PSE to public ownership, no significant reforms can be instituted as long as the same brokers are calling the shots.
Yasay's replacement, Trade Undersecretary Lilia Bautista, will have the tough job of putting the PSE house in order. She will have to improve the SEC's implementation of its mandate as corporate regulator. Many people believe the BW fiasco is just the tip of the insider trading iceberg at the stock exchange. For these irregularities, the SEC is partly to blame. Bautista needs to overhaul both the PSE and the SEC. The public needs reassurance that there's an effective watchdog for their investments.