R&L Investments, which is one of the oldest brokerage firms in the Philippines, shut down in 2019. This was after discovering that P700 million worth of shares were illegally transferred to another stockbroker firm.
The key takeaway is this: The crime happened inside R&L, and even the police gave the opinion that it’s impossible for the owners not to know what’s happening.
This scheme went unnoticed for eight years until R&L Treasurer Lucy Lee reported missing stocks in 2019.
But what really happened here?
Marlo Moron, a staff at R&L, admitted to transferring the amount to a particular Julieto Sulapas account in another stockbroker firm from 2012 to 2019.
Mr. Moron then confessed to the theft and even issued a written statement. It was even reported in the statement that Mr. Moron used these funds for his gambling addiction.
The theft resulted in the loss of P700 million for R&L as SEC recently revoked their license and even fined them P25 million.
In an investigation, the Securities and Exchange Commission found out that Lee gave access codes to Mr. Moron, which allowed him to issue the trades.
Furthermore, Mr. Moron recently denounced his earlier statement and said that he was only a worker that obeys his orders. He said that he was only following the orders of Lee, which were to transfer the shares of R&L clients to the account of Sulapas.
As this case is currently being investigated, it’s hard to say anything with 100% certainty.
However, it would be impossible for just one man to be behind everything the way I see it. Similar to many scandals of the past, there was always a bigger picture.
Take note that Mr. Moron don’t have a license to trade, and he was only allowed to do so upon the instructions of Lee and was given the access codes.
This is especially considering that they would have to do audits yearly. And that this crime happened for eight years. For a large-scale theft like this, it’s worth probing into this a bit more.
Worth investigating also is how this scheme managed to go on for 10 years without getting flagged by external and compliance auditors. Loopholes such as these need to be plugged to restore integrity in the stock market.
References:
https://www.rappler.com/business/securities-exchange-commission-rl-investments-license-revoked-fined
