Filipinos warned: jail does not wipe out debt
DUBAI // A website launched to help Filipinos who are overwhelmed by outstanding bills must first convince them their debts will not be cleared by serving a jail sentence, a banking expert says.
"We would like to correct this misconception," said Ronald Hullana, the founder and president of the UAE Pinoy Bankers Organisation.
"Many prefer to be jailed when they default on their credit card payments and loan amortisations. They are unaware that the bank can also file a civil case against them."
Issuing a bad cheque is a misdemeanour that can result in a fine, imprisonment or both. In most cases offenders are kept in prison until they repay the debts.
"The bouncing cheque law has become purely a punitive and not a corrective law," Mr Hullana said.
There have been repeated calls, most recently by the chief of Dubai Police Lt Gen Dahi Khalfan Tamim, for the law to be reformed.
Mr Hullana said banks and other creditors should be more patient and avoid sending people to jail.
"If a bounced cheque was issued because of a loan, the bank should allow a certain period for the debtor to pay," he said.
"I believe banks could issue up to three notices before it opens a police case against the defaulter."
The bankers' group plans to hold a series of workshops across the UAE before the end of the year to advise indebted Filipinos on how to better manage their money.
The Philippine Embassy says debt is the second most common reason for Filipinos being jailed in Abu Dhabi and Al Ain, after sex-related offences.
"It is unfortunate that Filipinos are among those who have been penalised so we need to help those who are in debt at the moment," said Joanofarch Aguila Catalan, a bank co-ordinator with the Pinoy Bankers Organisation.
The group, formed in 2008 to help bankers affected by the crisis, began its online awareness campaign last month. It has more than 100 members.
In coming weeks its members and banker friends will contribute articles to a blog at the organisation's website, uaepinoybankers.org.
They are also on Twitter (@UAEPinoyBankers) and Facebook (uaepinoybankers.org).
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Published: July 31, 2011 04:00 AM