SOMETIMES, a disclosure may not be as informative as you expect it to be. Instead, you find one that may be amusing and which you cannot ignore.
To the Philippine Stock Exchange and its team of managers, every information posted on its website is a disclosure that can affect a stock’s trading. For the sake of transparency, they monitor every piece of information filed by listed companies even those that they doubt would affect a stock’s market price.
Recently, they found one that should not merit consideration at all but which PSE people have to acknowledge because it is their duty to accept every information posted on PSE’s website. This particular filing was posted by Max’s Group Inc.
Max’s Group faces a court suit from a former worker who wanted his original investment of P300 plus interest earnings based on 80 percent interest rate per annum. Imagine yourself being sued for failing to pay an investment of P300 back in 1974. That’s 40 years ago!
In a letter dated Nov., 7, 2014, Rebecca R. Arago, corporate officer of Max’s Group, informed PSE that a certain Alodeo F. Agsunod, a former employee of Q.C. Max’s, has sued the 11 executives and members of the company’s board.
Arago told PSE, “that while an employee of Q.C. Max’s, he (Agsunod) made an investment of P200 with the Max’s Ermita Loans and Savings Association and P100 with the Max’s Baclaran Employees Loan and Savings Association.”
Agsunod claimed in his complaint, his money “should have earned 80 percent per annum from 1974.”
“On this basis,” Max’s Group said, Agsunod filed the present complaint, claiming the respondents are responsible for depriving him of his investments.”
Cited respondents for “syndicated estafa” were Robert F. Trota, director, president and chief executive officer; Eduardo B. Ungco Jr., Cristina T. Garcia, director and treasurer; Jim T. Fuentebella, director; Carolyn T. Salud, director; Sharon T. Fuentebella, chairperson; Erlinda T. Fuentebella, Jean Burkley Rodriguez, Ruby Estaniel, Armando Orcena and Rick Martillano.
Unluckily for Agsunod, Q.C Max’s, of which he was one of the employees, “has been dissolved several years ago and no longer exists as a corporate entity,” according to a filing.
However, whatever happens to the suit is not what this piece is all about. Let the court handle that while Due Diligencer has to monitor every move of both the prosecution and the defense.
Meanwhile, Due Diligencer computed Agsunod’s claim based on compounded interest of 80 percent to see how much his P300 would be worth today, or in a 40-year period, and came out with an astonishing total of P2.71 trillion.
Yes, Agsunod would be that rich if only he can have it.
A word of caution: Due is presenting here the computations to show how much one earns if only there is such a thing as 80 percent interest return on investment per year.
Of course, there is no none. But Max’s cannot simply take Agsunod and his complaint for granted.
In the beginning. Agsunod’s P300, which in 1974 meant much more than what it is today, earned P240 in interest. This plus the principal equals P540, multiplied 80 percent equals P432 plus P540 equals P972. The series of computations goes on until the principal and the interest earnings combined top P1 million on the 14th year; P100 million on the 22nd year and P1 billion on the 26th year.
Here is how Agsunod’s P300 investment grew in 40 years: