In this article, former SEC Chairman Perfecto Yasay accuses Mar of having “killed” the pre-need industry. His specific allegations:
- That Mar pushed for the entry of life insurance company American International Group Inc. (AIG) into the country because he was then an AIG official
“The P27-billion pre-need industry was the direct competitor of the lackadaisical P5-billion life insurance industry. Mar Roxas, who was then an official of AIG, wanted life insurance to be resuscitated and the only way to do that was to kill the pre-need industry, in which he succeeded being then the secretary of the Department of Trade and Industry…”
- That Mar had him suspended in order to get him out of the way
“I was the stumbling block to Roxas’ vested interests at the time and so he had me suspended…”
Let’s check the facts.
- Mar served as DTI Secretary between 2000 and 2003. Prior to that, from 1993 to 2000, he served as Congressman for the first district of Capiz. How could he have been an AIG official at any point during this decade?
From LP Spokesperson Cong. Barry Gutierrez:
“In both positions, he [was] not allowed to receive a salary from private concerns, and we can prove through the waiver we signed that there was no conflict of interest for Mar.”
What about Yasay? Why can’t he show any proof?
- Mar did not orchestrate Yasay’s suspension. These articles dating from March 2000 clearly state the reason for his suspension:
“…Yasay particularly violated Section 38 of the Revised Securities Act, which states that the power to stop the trading requires the approval of the entire five-member commission.”
From former Chief Presidential Legal Counsel Magdangal Elma’s memorandum for then-President Estrada:
“Said act of Chairman Yasay in suspending the trading in the PSE is undeniably prejudicial to the national economy and undermines the confidence in the stock exchange by local and foreign investors with far-reaching consequences.”
And again from Cong. Barry Gutierrez:
“You can see the credibility of Mr. Yasay from the misinformation he spread[s]. As SEC chair, he resigned in the face of accusations of usurpation and misrepresentation of authority.”
So what’s the real score between Mar and the pre-need industry?
This news article provides a brief background of the industry and why many such companies failed.
“Immediately after the Asian financial crisis, preneed firms started collapsing. The problem peaked in mid-2000s when big industry players, including College Assurance Plan (CAP) and Pacific Plans Inc., could no longer service their obligations to plan holders.”
“[SEC Commission Secretary] Lukban said the problem with preneed firms was that it had no international model to follow.”
The article goes on to describe the industry’s “disastrous open-ended plans.” When the education sector became deregulated in 1992, pre-need firms found that they could no longer keep up with tuition fee increases.
The pre-need industry had many problems, and its decline was caused by years of mismanagement and poor business practice. At the height of the CAP fiasco, Mar called for the company to immediately pay the tuition fees it had promised to cover. From a press statement dated January 28, 2005:
“Ang higit nating dapat pagtuunan ng pansin ay ang kapakanan ng libu-libong mga mag-aaral (CAP scholars), lalo’t higit ang katuparan ng pangarap ng kanilang mga magulang na magarantiya ang kanilang edukasyon at magandang kinabukasan. Idagdag pa rito ang napakalaking tiwalang ibinigay nila (magulang) sa CAP. Tunay na napakalaking ligalig at kawalan ng pag-asa ang naidulot ng problemang ito sa napakarami nating kababayan.”
As early as 1998, Mar already advocated the passage of a pre-need code, precisely to protect parents and consumers of pre-need plans and avoid the kind of fiasco that occurred in 2004. As Congressman, he filed House Bill No. 83, which sought to regulate the pre-need industry in order to ensure its liquidity and solvency and to protect consumers. As Senator, he filed Senate Bill No. 1896 and again Senate Bill No. 105. Both sought to lay down the same safeguard measures for the pre-need industry.
Finally, the Pre-Need Code of 2008 was passed into law (Republic Act No. 9829) with Mar as one of the principal authors. The law strengthened regulatory measures over the industry, as well as protected consumers from possible mismanagement of their investments.
From the beginning, Mar believed that pre-need plan holders deserve protection and the proper return of their investments. Whether as a congressman or senator, he acted in their best interests. To now say that he killed the pre-need industry is not only a gross fabrication; it is the complete opposite of the truth.