Sunday, May 24, 2009

New CTD variations

We always thought that there was only one kind of certificate of time deposit (CTD); the one issued by a bank when you deposit your money for a fixed period and the same one that you would present to the bank on or after the termination date. With the closure of the legacy banks, and the PDIC reasons for the delay in its settlement of claims, we realized that there are two kinds of CTDs, with various configurations, when it comes to claiming with the PDIC:

First is the CTD where actual money was deposited into the bank, but classified by PDIC as:
a. Verified CTD: supported by all six documents that the closed bank should have in its files;
b. Incomplete CTD: supported by at least one of the six documentary requirements of the PDIC; and
c. Fraudulent CTD (according to PDIC) with no single supporting bank document. However it is a valid CTD, except the bank has no record at all of the transaction.

Second kind is the CTD where no money was deposited into the bank, but the bank still issued a certificate upon orders of Celso so as to placate irate and anxious creditors:
a. In exchange for a bounced check/s issued for promised returns on legacy buyback investment schemes;
b. As separation pay for legacy employees;
c. As payment of all kinds of overdue (current included?) accounts due suppliers, partners, etc.

There is no question that the second kind of CTDs has no chance of being paid by PDIC. However, there is a big possibility that Prosperous Nograles is (was because PDIC has already paid) holding his uncollected P18 million in CTDs (issued so as to pacify and appease the angry Speaker). And if the older Nograles had those CTDs, do you think his younger brother wouldn't ensure that he gets paid by PDIC? Your guess would be as good as ours.

Obviously, funded CTD type a has no problem, but we guess this would be the exception since most legacy banks, according to the younger Nograles, had missing documentation. Most deposits would then fall into funded types b and c. If PDIC fails to pay these funded deposits, DEADBOL is ready to go to court and show the world, not only that these deposits are valid and legitimate, but PDIC failed in its avowed mandate and mission to protect bank depositors who entrusted their hard-earned money and assets into the banks.

USA's FDIC proudly states in all its sites and articles that "Since the FDIC was founded in the 1930s, no one has ever lost a penny of FDIC-insured funds." PDIC will never ever be able to boast of this accomplishment.

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