Cathay Life Insurance Co (國泰人壽), which holds a 21.93 percent stake in Philippine lender Rizal Commercial Banking Corp (RCBC), yesterday said that it is cooperating with local authorities in an international money laundering investigation.
Last month, hackers stole about US$100 million from a Bangladeshi central bank account at the Federal Reserve Bank of New York, of which US$81 million was allegedly deposited into a RCBC branch in Makati, Metro Manila, the Philippine Daily Inquirer reported.
RCBC has pledged to cooperate with the ongoing investigation into subsequent movements of the funds, which were also reported to involve several casinos.
Cathay Life, the nation’s largest insurer and the most profitable unit under Cathay Financial Holding Co (國泰金控), said that RCBC is among a number of banks under investigation, and that it has alerted local authorities of the matter.
In 2014, Cathay Life received board of directors’ approval to acquired a 21.93 percent stake in RCBC for about NT$12.55 billion (US$382.56 billion), equivalent to 64 Philippine pesos per RCBC share, representing a price-to-book value ratio of 1.57.
The deal was completed in the first quarter of last year, after the Financial Supervisory Commission (FSC) began encouraging Taiwanese financial institutions to tap into the vast Southeast Asian markets in 2013.
Due to the size of the investment, and Cathay Life’s status as RCBC’s second-largest shareholder, the the alleged laundering is being monitored by the FSC, Insurance Bureau Director-General Jenny Lee (李滿治) said yesterday.
The commission said that it is not appropriate to provide further comments amid ongoing investigations, but maintains its support for local financial companies expanding in the Asian market.
However, the incident might raise concerns about the risks involved in overseas expansions, and dampen companies’ interest in future investments, the commission said.
Controlled by Chinese-Filipino tycoon Alfonso Yuchengco, who has a 41.68 percent stake, RCBC has 450 branches and is the fifth-largest bank in the Philippines by assets.
With Cathay Life holding one seat on RCBC’s board, the Taiwanese firm can contribute in improving the Philippine lender’s compliance oversight, former FSC chairman William Tseng (曾銘宗) said.
Meanwhile, a Philippine businessman, one of six people reportedly under investigation for the alleged laundering of US$81 million dollars, is asking Philippine authorities to unfreeze his bank accounts, saying he was not involved.
Ramon Esguerra, a lawyer for William S. Go, said yesterday that the accounts registered under Go’s name and his company, Centurytex Trading, at a branch of RCBC were bogus.
He said Go’s signature for the account was forged.
The Bangladesh Bank has said it has recovered some of the stolen money, and is working with anti-money-laundering authorities in the Philippines to try to recover the rest.
In addition, FireEye Inc’s Mandiant forensics division is helping investigate the cyberheist, people familiar with the matter said on Thursday, adding that the Silicon Valley-based company was brought in by World Informatix, a smaller firm that is advising the Bangladesh Bank on the investigation.
One of those sources, a senior official with the central bank, said the US government has offered to help investigate how hackers stole funds from the account at the New York Fed.
Additional reporting by AP and Reuters
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