A deputy and the lawyers’ bar are concerned the government may have allowed putting too many eggs in the same basket regarding pension plan funds.
Deputy Pedro Martínez, from the Alianza País party, expressed concern that three leading pension management plans had purchased a majority of the recently placed shares of Cesar Iglesias consumer goods industry. César Iglesias is the first publicly traded company in the Dominican Republic.
On Tuesday, 29 August 2023, Martinez said he will ask the Social Security Commission of the Chamber of Deputies to inquire with Superintendent of Pensions, Francisco Torres on the bulk sale of the shares.
Diario Libre reports that Martinez refers to the transaction executed by three Pension Fund Administrators (AFPs) for RD$3,492,190,033.56. The operation practically made more than three million affiliates to AFPs direct shareholders of the manufacturing company.
Deputy Martínez said the Chamber of Deputies will investigate the Superintendent of Pensions because the transaction “exposes the funds” that belong to the workers and is “an obvious risk.”
The aforementioned AFPs manage 62.41% of the pension plan resources and 65.51% of the workers resources corresponding to the individual capitalization system.
The Superintendent of Pensions had highlighted that the transaction price was RD$128.84 for each share and that the number of outstanding shares offered to the stock market by the company César Iglesias is 38,721,220, which represents 30% of the shares of the company.
Meanwhile, the Bar Association of the Dominican Republic (CARD) has filed a formal complaint against the Superintendent of Pensions, Francisco Torres, for his participation in the approval of the sale of more than 27,000 shares of the company César Iglesias, S.A., with the funds workers’ pensions, for an amount of RD$3,492,000, despite the company having reported losses of more than RD$500 million in 2022.
Miguel Surun, president of CARD, denounced that the audited statements as of December 2022, carried out by the Fitch Risk Rating Agency, indicate that this company reported losses of RD$575.4 million and with a negative forecast for May of this year.
Surun Hernández stated that it is an operation prohibited by Social Security System Law 87-01 and its regulations because it is one of high risk. He remarked that those involved could have incurred in the crimes of aggravated breach of trust, association of criminals and others.
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30 August 2023