MANILA - The Court of Appeals (CA) has affirmed its earlier ruling dismissing insider trading charges against former trade minister and business tycoon Roberto Ongpin over shares of Philex Mining Corporation in 2009.
In a five-page resolution dated July 2, penned by Associate Justice Ma. Luisa Quijano-Padilla, the appellate court’s Special 13th Division denied the motion for reconsideration filed by the Enforcement and Investor Protection Department (EIPD) of the Securities and Exchange Commission (SEC) that sought a reversal of its December 1, 2017 decision absolving Ongpin of the charges.
The December 2017 decision reversed the SEC’s July 8, 2016 ruling that found Ongpin liable for 174 counts of insider trading under Section 27.1 of the Securities Regulation Code, and ordered him to pay a P174-million fine (P1 million per count), 10 times higher than the P17.4 million recommended by the SEC-EIPD.
In its motion, the SEC argued that the appellate court is bound by its findings.
The CA disagreed as it stressed that only “findings of fact” of quasi-judicial bodies, not their conclusions, are binding upon the court, under Section 10, Rule 43 of the Rules of Court.
“This Court is therefore not bound by the legal conclusions of the former owing to the inherent duty of courts of law to determine legal issues and settle actual controversies,” the resolution stated.
The appellate court further said the arguments the SEC raised in its plea “are mere rehash” of those it already raised in its petition.
“This Court is therefore not convinced that a modification of our ruling is warranted.”
The state regulator found Ongpin to have benefited and profited from insider or material non-public information, stemming from his purchase of additional Philex shares ahead of a Dec. 1, 2009 deal with Hong Kong-based First Pacific Co. Ltd. for the latter's buying into Philex.
The commission pointed out that he "was able to consolidate the required number of shares, supplementing his block of shares with the shares brought from the open market, sold them to the subsidiary of First Pacific at the privately agreed price of P21 per share, thereafter giving the First Pacific group control over Philex."
Ongpin, however, maintained that the SEC failed to prove its case against him and that the 3-year prescriptive period to administratively charge him had already lapsed.
He further argued that the SEC-EIPD only issued a show cause order against him in November 2014.
The appellate court halted the implementation of the fine through a 60-day temporary restraining order in favor of Ongpin, taking into consideration another penalty imposed by the corporate regulator disqualifying him from being an officer or member of the Board of Directors of any publicly listed firm.
The CA subsequently issued a writ of preliminary injunction which stayed the implementation of the fine until the petition is resolved.