Radaza enters no plea in Subangdaku bank fraud case

Using his smartphone, businessman Efrain Pelaez Jr. (left, sitting) takes a photo of Lapu-Lapu City Mayor Paz Radaza as she emerges from her arraignment in Branch 56 of the Mandaue City Regional Trial Court. (CDN PHOTO/ TONEE DESPOJO)

Lapu-Lapu City Mayor Paz Radaza yesterday showed up in court but did not enter a plea in a bank fraud case  involving fictitious loans worth P2.6 billion arranged in 2004 to 2008.

Four of her co-respondents pleaded not guilty during   arraignment to charges of violating banking laws in   operations of the Rural Bank of Sugbandaku where Radaza was president until its closure in 2009.

Seven other co-respondents were absent.

Radaza’s lawyer, Hansen Dy, said the mayor is “questioning the absence of a complete preliminary investigation before the filing of these cases, among other grounds.”

Dy said they will file a petition for certiorari before the Court of Appeals in mid-October to review the case.

Radaza’s arraignment  in Branch 56 of the Mandaue City Regional Trial Court served as a venue for supporters of her political rival, Efrain Pelaez Jr., to hold a rally outside the court house.

Pelaez, who is seeking the mayorship in 2016,  and Rene Espina Jr., who is eyeing  a congressional seat, attended the proceedings.

“There are depositors who have come to us saying if we can help them. We are also surprised this case is not a syndicated estafa case,” Pelaez said.

“I believe this is a much bigger case. We are here to see what’s happening,” he added.

In a statement, the mayor’s consultant, Jonji Gonzales said the case has nothing to do with her being a mayor and was“an issue while she was a private citizen.”

Mayor Radaza was a barangay captain of Mactan  when she served as   president of the defunct Rural Bank of Subangdaku (Cebu),  Inc. and a member of the bank’s credit committee.

She and 11 other bank directors and officers were charged last year for violating the DOSRI (directors, officers, stockholders and related interests) rules under Republic Act 8791, or the General Banking Law of 2000.

The bank’s main office in Mandaue City and six branches were shuttered in January 2009. The Monetary Board placed it under receivership on Jan. 8, 2009 and appointed the Philippine Deposit Insurance Corp. (PDIC) as receiver.

PDIC filed the criminal complaint before the Department of Justice against the bank’s officers and directors in January last year.

In its complaint, the PDIC stated that Radaza and former loans manager Julius Eullaran created 6,051 fictitious loans amounting to nearly P2.6 billion from 2004 to 2008. The loans comprised about 97 percent of the total loans released by the bank for the period.

Of these, 5,470 did not have the required credit information while 581 had no supporting documents.

Other respondents of the case who entered a plea of not guilty yesterday were Eullaran, Marmelina Cuevas, Glenn Patrimonio and Aileen del Fierro.

A pre-conference will be held on January 13, 14 and 15, 2016 while the pre-trial has been set for April 18, also next year.

DOJ and Bangko Sentral officials or representatives are expected to attend the pre-trial.