MEMORANDUM ORDER NO. 61
BROADENING THE SCOPE OF THE AD-HOC FACT FINDING COMMITTEE ON BEHEST LOANS CREATED PURSUANT TO ADMINISTRATIVE ORDER NO. 13, DATED 8 OCTOBER 1992
WHEREAS, among the underlying purposes for the creation of the Ad-Hoc Fact Finding Committee on Behest Loans is to facilitate the collection and recovery of defaulted loans owing government-owned and controlled banking and/or financing institutions;
WHEREAS, this end may be better served by broadening the scope of the fact finding mission of the Committee to include all non-performing loans which shall embrace behest and non-behest loans;
NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Republic of the Philippines, by virtue of the powers vested in me by law, do hereby order:
Section 1. The Ad-Hoc Fact Finding Committee On Behest Loans shall include in its investigation, inventory, and study all non-performing loans which shall embrace both behest and non-behest loans.
The following criteria may be utilized as a frame of reference in determining a behest loan:
a. It is undercollaterized.
b. The borrower corporation is undercapitalized.
c. Direct or indirect endorsement by high government officials like presence of marginal notes.
d. Stockholders, officers or agents of the borrower corporation are identified as cronies.
e. Deviation of use of loan proceeds from the purpose intended.
f. Use of corporate layering.
g. Non-feasibility of the project for which financing is being sought.
h. Extra-ordinary speed in which the loan release was made.
Moreover, a behest loan may be distinguished from a non-behest loan in that while both may involve civil liability for non-payment or non-recovery, the former may likewise entail criminal liability.
Section 2. This Memorandum Order takes effect immediately.
Manila, 9 November, 1992.
(Sgd.) FIDEL V. RAMOS
By the President:
(Sgd.) EDELMIRO A. AMANTE, SR.Executive Secretary
(Sgd.) EDELMIRO A. AMANTE, SR.Executive Secretary
