MANILA, Philippines—The Mandaluyong City Regional Trial Court has ordered the arrest of five Filipinos connected with the bankrupt US-based investment bank Lehman Brothers for alleged violation of the Anti-Dummy Law.

Judge Edwin Sorongon of the Mandaluyong RTC Branch 214 also issued a hold-departure order against Norman Macasaet, Carlos Mañalac, Michael Rabonza, Edilberto Castañeda and Ana Marie Katigbak to ensure the court’s jurisdiction over them during the prosecution of the case.

The case stemmed from a complaint filed by businessman-restaurateur Victor Villavicencio, president of the Triple V Group of Restaurants, against the Lehman Brothers and its Philippine affiliates—Philippine Investment One Inc. and Philippine Investment Two Inc.—for violation of the country’s Anti-Dummy Law and the constitutional restrictions on foreign ownership of land.

To stave off the warrant of arrest issued by Judge Sorongon, the accused filed several pleadings, including a motion for reinvestigation of the case and a motion to quash the arrest warrants issued against them.

However, Villavicencio’s lawyer, Allan B. Gepty, opposed the motions, contending, among others, that there was probable cause to indict accused for violation of Anti-Dummy Law. He said there was a reasonable ground to believe that they incorporated several corporations to serve as Lehman Brother’s conduit to purchase, own, manage, administer and control a real property.

No new issues

Sorongon denied the motions, stressing in his Sept. 4 order that they presented no ‘‘new issues but mere rehash and reiterations of their earlier arguments and no new substantial issues have been raised.’’

The land in question is a piece of property on Shaw Boulevard in Mandaluyong City which was foreclosed by Equitable PCI-Bank in 1999 to settle a P402 million obligation. Villavicencio said that while he had 10 years to redeem the property under their restructuring agreement, Equitable-PCI Bank sold the assets soon after to Philippine Investment Two Inc., which is owned by Philippine Investment One Inc.—a company that is, in turn, majority-owned by Lehman Brothers’ Singaporean unit.

Villavicencio claims that under the Civil Code he has the right to redeem or buy back the said property by reimbursing Philippine Investment Two Inc. the price that it paid to Equitable-PCI Bank.

However, Villavicencio said he later discovered that upon scrutiny of the equity and shareholdings of Philippine Investment Two Inc., it appeared that Lehman Brothers was the real and beneficial owner of the properties, thus prompting him to file the criminal complaint.

Villavicencio, in a press statement, said he now wants to buy back the property from the Lehman Brothers-owned firm for P60 million to P65 million, the same price at which they bought it from Equitable-PCI Bank.

From a net worth of almost $700 billion, Lehman recently filed for bankruptcy protection after several failed business ventures, the largest bankruptcy case in the history of the United States.