Feb. 9--In a statement, the central bank said it filed the charges before the Department of Justice on Friday. These cases involve 116 counts of falsification of public and commercial documents and two counts of false statements against 18 officers, employees, and agents of four closed rural banks of the Legacy group. They include the Rural Bank of Paranaque, Rural Bank of DARBCI in South Cotabato, Rural Bank of San Jose in Batangas and Bank of East Asia.

On January 5, the central bank filed the first charges against the Legacy banks' 16 officers, employees and agents--49 counts of falsification of public and commercial documents and one case of false reporting and false statement. These banks include four other closed rural banks of the Legacy group, consisting of the Rural Bank of Paranaque, Rural Bank of San Jose in Batangas, Dynamic Rural Bank in Calatagan, Batangas and Rural Bank of DABCI in South Cotabato.

Based on the central bank's investigation, the rural banks implemented massive diversion of funds using fictitious loans.

During the validation process, many of the banks' borrowers denied having obtained loans from the closed banks while others admitted having signed blank documents in consideration of commission fees ranging from P10,000 to P15,000 for supposed loans amounting to millions of pesos.

The central bank also discovered that falsified documents were used to support alleged loans. Public documents falsified included mayor's permits and Department of Trade and Industry's registration certificates.

Probe to push ahead

Bangko Sentral said it would continue to investigate other Legacy banks. Since December, the central bank closed 13 rural banks under the Legacy group, which is owned by Celso de los Angeles.

In response to the simultaneous closures, the central bank later expanded the banking activities considered unsafe and unsound practices to strengthen bank supervision, such as monitoring of low-quality loans, high interest rates and aggressive deposit taking.

To give the bank regulator enough teeth, the central bank is pushing for stronger authority to supervise distressed financial institutions in the proposed amendment of its charter-- a measure that is pending in Congress.

Central bank Gov. Amando Tetangco Jr. had earlier said that the rural banks recently placed under receivership represent a "tiny fraction" of the rural banking system's assets. The problems that led to their closure pre-date the present global financial crisis.