Money Magnets

The Securities and Exchange Commission (SEC), which monitors the pre-need industry in the Philippines, revoked the dealership licenses of two more pre-need firms!  The firms whose licenses have been suspended are Permanent Plans and Prudential Plans Inc.

Prudential Plans' license was revoked due to a deficiency in its trust fund.  Prudentiallife Plans president, Jose Alberto Alba, blames the global financial crisis for the deficiency.  In a radio interview, Mr. Alba said that Prudentiallife Plans has around 200,000 plan holders.  Half of which are pension plan holders and around 70,000 are education plan holders. 

In the other news, Permanent Plans president, Juan Miguel Vazquez, said that the SEC decision of suspending their license came as a surprise as it has already informed the SEC that it would stop selling pre-need plans as it no longer believes in the viability of the pre-need industry due to harsh economic times.  The company is now focused on protecting their plan holders and promptly settling their claims.

The suspension of Prudential Plans' license really comes as a surprise given their good track record over the last 31 years.  I personally think that Prudential Plan is still very much capable of servicing their clients.  I hope people will not panic.

On a brighter note, the SEC seems to be on its toes.  Possibly the only good thing that has sprung up from the Legacy mess.