The Court of Appeals issued a restraining order stopping the Securities and Exchange Commission from implementing its decision on insider trading case against former trade minister Roberto Ongpin.
The appellate court said in a resolution on Aug. 1 the 60-day restraining order was issued “to prevent serious damage” against Ongpin, who was slapped with a P174-million fine by SEC and was disqualified from being an officer or a member of the board of directors of any public company for allegedly committing insider trading in the sale of Philex Mining shares in 2009.
“Gauging from the complexity of the matters at hand and seeing that the circumstances in this case present an urgent and paramount necessity to prevent serious damage upon petitioner Ongpin since the assailed decision of the SEC en banc may, at any time, be implemented pursuant to section 12 of rule 43 of the Rules of Court, we resolve to grant the prayer for the issuance of a temporary restraining order,” CA said.
“In so ruling, we considered not the amount of fine imposed upon Ongpin but the penalty of disqualification and the order for him to relinquish or resign from the positions of director or officer, the extent of which affects not only the company Philex, but all other public and publicly listed corporations,” it said.
CA also set the hearing for Aug. 23 and 24, 2016.
Ongpin hired the law firm of Estelito P. Mendoza as a collaborating counsel.
SEC last month ordered the disqualification Ongpin from the board of any publicly listed company and asked him to pay a fine P174 million, or P1 million each from alleged 174 counts of insider trading, based on Section 54.1 of the Securities regulation Code.
SEC said the decision to impose the maximum penalty would quell if not totally eliminate insider trading and other fraudulent manipulative devices and practices which create distortions in the free market. It said a minimum penalty would send the wrong signal to the public that administrative penalties was not sufficient to quell fraudulent market activities.
Ongpin currently sits as chairman of two listed companies, including PhilWeb Corp. and Atok Big Wedge Inc.
The SEC investigation showed that Ongpin had gained non-public material information as a director and as selling shareholder of Philex when he acquired additional shares in the mining firm before Philex shares were sold to the First Pacific group in 2009.
Ongpin’s legal counsel earlier explained that the SEC’s investigation pertained to the same Philex Mining case which was originally filed at anti-graft court Sandiganbayan by the Ombudsman as a behest loan case and was twice quashed by Sandiganbayan for lack of evidence.
“This particular case now has been shifted by the SEC to an insider trading case, but in no way can this case be called insider trading. The jurisprudence is clear on that. The case had unquestionably prescribed as it was filed almost a year after the two-year deadline required in the Securities Regulations Code,” Ongpin’s legal counsel said.