The Social Security System (SSS) has scored a court conviction against the president of an advertising agency for the company’s failure to comply with its obligation to remit employees’ contributions of nearly P3 million, including penalties, over a period of ten years.
SSS Assistant Vice President for Operations Legal Department Renato Jacinto S. Cuisia said that Peña, Larzaga and Wilwayco (PLW), Inc. President Adriel C. Peña was sentenced to an imprisonment of four years and two months as minimum to twenty years as maximum.
Aside from Peña, members of the Board of Directors Edwin C. Wilwayco, Nestor A. Largoza, Jesus Rey C. Lalie and Felimon D. Garcia were also charged with violations of the Social Security (SS) Act, or Republic Act No. 1161 as amended by Republic Act 8282. However, the case against Wilwayco was dismissed by the court while a Warrant of Arrest was issued against Largoza, Lalie, and Garcia who all remain at large.
“The lower court also directed Peña to pay a total of P2.8 million representing the total unremitted contributions inclusive of penalties covering the period of 2001 to 2011. Under the SS Act, overdue contributions are charged a three percent monthly penalty until paid in full,” Cuisia said.
Based on the decision, Peña initially made payments amounting to P317,000 as partial compliance to the company’s liability with SSS. However, he claimed “good faith” and insisted that he was not aware that his co-accused Garcia did not remit the contributions of their employees.
During the trial, Peña claimed that as company president, his only task was to sign documents related to conduct of their operations. He asserted that he should only be made liable to a portion of the amount due and not the whole delinquency.
“Mr. Peña’s claim of good faith by paying a portion of the company’s liability out of his own pocket was not honored by the court. According to the decision, his voluntary payment does not negate his responsibility in managing the affairs of the company as well as his violation of the SS Act,” Cuisia said.
Records showed that PLW religiously paid its employees’ contributions during the early years of its operations. It was only in 2001 that the company started failing in fulfilling its SSS obligations, based on the investigation and examination of records conducted by SSS Account Officer Felix Ike T. Dungca.
According to Dungca, after a thorough review and reconciliation of PLW’s records, he personally served to the company the billing letter from SSS regarding the delinquency. When no indication of settlement was made after 15 days, Dungca then sent to PLW the demand letter from the SSS.
“PLW claimed that their non-remittance of SSS contributions was due to economic loses and mismanagement. However, such defense is not also accepted by the court since a mere violation of special laws such as the SS Act is enough to hold a person accountable,” said Cuisia.
So far this year, the state-run pension fund was able to secure four convictions against members of the board of directors of companies who were delinquent in fulfilling their obligations with SSS.
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