BY GEROME DALIPE IV
ILOILO City – The Cooperative Development Authority (CDA) has filed administrative charges against 14 officers and members of the Iloilo City Government Employees Multi-purpose Cooperative (ICGEMPC) over the release of loans reaching P31 million.
Antonio Escobar, CDA-6 director, filed the following complaints serious dishonesty under Rule VII, Article VI (A) 8 and 9; grave misconduct under Rule VII, Article VI (B); disgraceful conduct under Rule VII, Article V (D); inefficiency under Rule VII, Article V (F); and violation of Article 39 and gross negligence or bad faith to Article 45 of Republic Act 9520, an act that amends the Cooperative Code of the Philippines.
Named respondents to the complaints were Leo Elevencione, former ICGEMPC chairman; Salome Villamor, vice chairman; and Board Members Cherie Ampig, Harriette Solis, Carmelita Orat, and Josie Castillo; Angelita Alvarez, audit committee chairman; Johana Pauline Vidal, audit committee member; Carmelita Garbillos, credit committee chairman; Evangeline de Juan, credit committee member/loan clerk; Irene Duliesco, general manager; Margaret Malban, bookkeeper; and Joy Bersamin, treasurer.
The case stemmed from the investigation the CDA Central Office centered on the cooperative’s governance, financial aspects, and other related issues.
ICGEMPC suffered huge financial losses due to loan transactions that reached P31 million, which resulted in the reduction of the capital share of its members.
After conducting a special examination, the CDA’s evaluation team found out that some loan transactions of the cooperative lacked regular monitoring of the officers in the operation of the cooperative.
These include the granting of loans to the manager, treasurer, bookkeeper, and other staff, several times in a month.
The CDA’s audit team also discovered significant amounts of past due loans of the management staff, based on the copy of the ledgers submitted by the examination team.
The CDA also pointed out the cooperative’s lack of policy covering the processes and procedures in the granting of loans.
The coop’s existing credit policy covers only the type of loan, amount of loan, terms of payment, and the requirements.
Its credit policy does not cover the approving authority, loan limit, or frequency of loan releases per member-borrower.
Based on the documents submitted, the CDA audit team observed the loan releases to certain individual borrowers were done multiple times in a month.
In the said policy, loans amounting to P500,000.00 and over require collateral. However, it does not specify the type of collateral.
Based on the coop’s collection mode, the loan obligations shall be deducted from the members’ payroll.
However, the CDA examination team noted the other borrowers paid their obligations over the counter.
An examination of the coop’s 2022 financial statements showed that these are not available for consumption by the members and other stakeholders. To date, the cooperative also has no certificate of compliance for the 2022 calendar year.
The CDA’s audit team also observed a sudden drop or irregular fluctuations of accounts such as in cash, loan receivables, and loan payables of the coop’s annual financial statement from 2019 to 2021.
Likewise, the audit team said that multiple loans in a month were released to certain ICEMPC officers and staff.
The audit team also discovered significant amounts of past dues.
“ICGEMPC does not have a policy limiting the amount of loans, including the DOSRI loans. It should be remembered that in a DOSRI loan, the maximum amount that may be borrowed by a cooperative’s director, officer, stockholder, or related interest must not exceed their total amount of capital contribution,” the complaint read.
Likewise, the audit team stressed that the DOSRI loan must be approved by a majority vote of the Board of Directors, excluding the director-borrower concerned.
When asked if there was a policy on limitations as to DOSRI loans during their incumbency, the respondents answered in the negative.
“They reasoned that as per cooperative practice, the directors, officers, staff, and members of the ICGEMPC were allowed to borrow loans as long as it is not over six times their capital buildup as the maximum limitation,” the complaint added.
As per the ledger of ICGEMPC, the audit team said there are DOSRI borrowers who exceeded their six-times capital build-up policy.
The audit team added that all loan applications in ICGEMPC are to be approved only by the chairman, vice chairman, general manager, and credit committee as evidenced by a pro-forma loan approval form made available during the interview and admitted by the Chairman during the interview.
In this case, the loan applications in ICGEMPC are not approved by a majority vote of the Board of Directors of ICGEMPC.
After the special general assembly meeting on 17 July 2023, a fraud audit was conducted by the Ad Hoc Committee.
“The foregoing violations of the respondents constitute poor performance which falls within the concept of inefficiency and incompetence in the performance of official duties and are grounds for removing an officer from office,” the complaint read.
The CDA sought the preventive suspension of the respondents while the investigation was ongoing. The co-op officers and members are given 10 days to submit their position papers and other supporting documents./PN
