Banking Board of Ecuador

RESOLUTION No. JB-2015-3328

THE BANKING BOARD

CONSIDERING:

THAT in accordance with the First Transitional Provision of the Organic Monetary and Financial Code, published in the Official Register Second Supplement No. 332, of September 12, 2014, whose text states that resolutions contained in the Compilation of Resolutions of the Superintendence of Banks and Insurance and the Banking Board, and the norms issued by the control bodies, will remain in force in all that does not oppose the Organic Monetary and Financial Code, until the Monetary and Financial Policy and Regulation Board resolves what corresponds, according to the case; and, with the second paragraph of the Third Transitional Provision, which states that the Banking Board will continue to act until it resolves all claims, appeals, and other administrative procedures it was handling on the date of entry into force of the same, within a period of one hundred and eighty days, extendable at the discretion of the Monetary and Financial Policy and Regulation Board;

THAT on February 21, 2014, lawyer Esteban Ortiz Dávila filed a claim before the Superintendence of Banks seeking verification and the imposition of the respective sanction against Banco Pichincha C.A., an entity with which he has a delinquent credit, on the grounds that, according to the bank, it had not responded to a letter sent by him to said entity, which stated:

"As a user of the Financial System, aware of the current legal regulations, I am truly amazed by the various ways BANCO PICHINCHA C.A. collects obligations from which it is rightfully a creditor.

It is the case that through the portfolio purchase made by Banco de Pichincha, I am a debtor of a credit backed by adequate guarantee (Trust in Guarantee, vehicle credit), and my surprise is that 'Banco Pichincha violates my Banking Secrecy by making, through its means, calls, notifications via cellular messages, to third parties totally unrelated to my contracted obligation.' I permit myself to recall that the credit requested from the company Automotores Continental does not contain co-signers, guarantors, sureties, or attached personal collateral.

For the foregoing, since it is constantly evident what was stated above, in accordance with what is provided by Art. 88 of the General Law of Institutions of the Financial System, I request that this illegal practice be rectified.";

THAT by letter No. DNAE-SAU-2014-02983, of May 14, 2014, Dr. Mirian Muñoz Solano, then National Director of User Attention, Acting, communicated to the claimant that she had instructed the entity, that the portfolio sale procedure, which is legally authorized, did not imply that the mechanisms used to recover the reported obligations with due dates infringed the duty of secrecy regulated in Chapter II, Title VIII, of the General Law of Institutions of the Financial System. Therefore, the procedure was declared concluded and the pertinent file was ordered to be archived;

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THAT on May 26, 2014, lawyer Esteban Ortiz Dávila filed an appeal for reconsideration against the administrative act contained in letter No. DNAE-SAU-2014-02983, of May 14, 2014, which was rejected by the National Director of User Attention with letter No. DNAE-SAU-2014-03778, of June 16, 2014;

THAT by writing presented on July 8, 2014, lawyer Esteban Ortiz Dávila filed before the Banking Board an appeal for review against the administrative act contained in letter No. DNAE-SAU-2014-03778, of June 16, 2014;

THAT the appellant bases his administrative appeal on the fact that the complaint presented does not concern the figure of portfolio purchase and sale, an operation permitted in article 51 of the General Law of Institutions of the Financial System, but rather the mechanics and practices that the bank uses to manage the collection of obligations, since said unhealthy practice violates Title III of the aforementioned Law; that the appealed resolution shows that the bank is the one selling the portfolio and indicates that in letter No. DNAE-SAU-2014-02982, the entity was instructed to apply provisions that oblige entities to communicate to their clients the events subsequent to the granting of credits, which was the sale of the portfolio to another legal entity unrelated to the financial entity; that there is confusion in the attention and processing of the complaint presented, since the "BUYER" of the Portfolio referred to in his complaint is BANCO PICHINCHA C.A. and not a company that buys sold portfolio, as mentioned in the appealed resolution; that at no time has it been evidenced or documented that there has been a sale of portfolio by BANCO PICHINCHA C.A. to a company that legally acquires delinquent portfolio; that this is evidenced in the credit bureau information which indicates that the obligation is reported by said bank; that article 308 of the Constitution of the Republic establishes that financial activities are a public order service,; and, that in concordance with article 52 of the same normative body, persons have the right to dispose of goods and services of optimal quality and to choose them freely, as well as to precise and non-misleading information about their content and characteristics;

THAT regarding the grounds presented by the appellant, it must be considered that according to article 90 of the General Law of Institutions of the Financial System, in force at the date the fact subject of the claim presented by lawyer Esteban Ortiz occurred, information on active operations is subject to reserve and not to banking secrecy, since the latter figure applies to deposits and public captations in accordance with article 88 of the aforementioned law;

THAT according to the information reported by the bank through letter No. BP-ACEC-2014-0349, of April 17, 2014, the management of the collection of the obligation registered in the name of the claimant is carried out by a company unrelated to the bank, for the same reason, unlike what the claimant states, it has not been the bank that has carried out the extrajudicial collection actions, which are, in accordance with the regulations of article 9, chapter I, title XIV, book I of the Compilation of Resolutions of the Superintendence of Banks and Insurance and the Banking Board, "any type of actions and extrajudicial management that by

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different means will be carried out to recover delinquent and overdue credit portfolios, which must be documented or registered as appropriate";

THAT as indicated by lawyer Ortiz, the credit was acquired from Automotores Continental, a company that later assigned the portfolio to Banco Pichincha C.A., who has been subrogated as creditor, and in that sense, the recommendation or corrective measure imparted to the bank by the User Attention Directorate applies to him, regarding adopting the necessary guidelines to verify compliance with norms related to portfolio sale and with the mechanisms for its recovery, understood, insofar as they are applicable to the case subject of lawyer Ortiz's claim, since as he mentions, the credit originated in Automotores Continental, and it should have been said company that communicated him of the portfolio sale to the bank;

THAT it has not been possible to evidence from the claim presented by lawyer Esteban Ortiz Dávila that the bank or the company carrying out the extrajudicial collection management has attacked his privacy, personal and/or family dignity, as guaranteed by numeral 14.6, article 14, chapter III, title XIV, book I of the Compilation of Resolutions of the Superintendence of Banks and Insurance and the Banking Board;

THAT the first paragraph of article 5, chapter IV, title XX, Book I of the Compilation of Resolutions of the Superintendence of Banks and Insurance and the Banking Board, which governs what is inherent to the attention of claims, provides:

"ARTICLE 5.- If the result of the analysis carried out by the Superintendence determines the need for the controlled institution to introduce corrective measures that regularize the situation that motivated the claim, the Superintendent of Banks and Insurance or the official who has the delegation of said authority, will impart the corresponding disposition".

THAT in the case subject to analysis, by reason that the extrajudicial collection management, since the obligation of which lawyer Esteban Ortiz Dávila is debtor was in default, there has been no breach of contract by the bank, especially since as indicated said service has been carried out through a company unrelated to the banking institution; and, that, for the same reason, once it was verified by the User Attention Directorate that there has been no violation by the bank of the duty of banking secrecy established in article 88 of the General Law of Institutions of the Financial System or any other regulatory infringement, it was determined that no sanction was applicable but the need to recommend that a corrective measure be applied, a measure disposed of by the control body in the exercise of its legitimate attributes;

THAT the National Legal Intendancy, through memorandum INJ-DNJ-SAL-2014-1056 of December 23, 2014, recommended to the Banking Board to reject the claim contained in the appeal for review filed;

AND,

IN exercise of its legal attributes;

RESOLVES:

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SINGLE ARTICLE.- REJECT the appeal for review filed by lawyer Esteban Dávila Ortiz; and, consequently CONFIRM the administrative act contained in letter No. DNAE-SAU-2014-03778, of June 16, 2014, with which the Director of User Attention rejected the appeal for reconsideration filed against the administrative act contained in letter No. DNAE-SAU-2014-02982, of May 14, 2014 that denied the request presented by the aforementioned financial user.

NOTIFY.- Given at the Superintendence of Banks, in Quito, Metropolitan District, on April 1, 2015.

Econ. Rodrigo Landeta Parra
GENERAL INTENDANT, S
PRESIDENT OF THE BANKING BOARD, E

I CERTIFY.- Quito, Metropolitan District, on April 1, 2015.

Lcdo. Pablo Cobo Luna
SECRETARY OF THE BANKING BOARD