DBAS president-appointee faces questions about leaked bank records

Development Bank of American Samoa recorded a loss of $400,000 when a freeze on interest payments of some customers’ loans were implemented for one-year only in 2010, says DBAS President Ruth Matagi-Fa’atili, who also says that during her tenure in the last four years, such a freeze was not implemented.

She also said that the government’s semi autonomous entity has taken steps to ensure that confidential personal records of all customers are secure, with only top senior officials having access to these records.

Prior to the Nov. 8 general election, financial records of some of DBAS customers were leaked to the public and posted on social media prompting complaints at the time of security measures put in place to prevent such information from being the subject of public debate and sometimes customers, who were not identified, were ridiculed on social media for preferential treatment by the bank.

During her Senate confirmation hearing last Thursday, Sen. Tuaolo Manaia Fruean said that with the elections over, has DBAS conducted an investigation into the leak that revealed loan records of some board members and others. He didn’t identify board members by name.

Tuaolo reminded Matagi-Fa’atili that these are confidential records, but some were leaked to the public, that means there was no security in place to protect them. He claims that someone at the bank leaked these confidential records. 

Matagi-Fa’atili, who has since been unanimously confirmed by the Senate for a second term, said the bank conducted and completed its investigation resulting in the termination of an employee. She didn’t elaborate further.

As to ensuring the safety of confidential personal records, she said DBAS has already implemented “restrictions” of “access” with only managers and supervisors now having such privilege.

Tuaolo also sought an explanation of “write off” to which the DBAS president said “write off or charge off” is when a customer is facing difficulty making loan payments and it’s then presented to the bank board for a decision and approval to pay “just the principle only” and not the interest rate — and this means putting a freeze on paying the loan’s interest rate.

Matagi-Fa’atili said there are guidelines the bank follows before a person’s loan is presented to the board for a “charge off”. She also explained that normally, if the loan is 120-days past due, it’s then given to the bank’s attorney for review and possible civil action to collect the outstanding debt.

She emphasized to senators that there are several levels that DBAS management goes through first before submitting a loan for “charge off” to the board.

Tuaolo reminded Matagi-Fa’atili that the 2016 general election is done and over with and advised her not to make a decision based on the notion of getting even or getting back at someone.

“Do the right thing and don’t forget to always love our people,” Tuaolo said. “And don’t do, for example, ‘give Tuaolo a loan first because he is a senator’. I don’t like that practice. Everyone is important.”

He then urged the bank to ensure the protection of customers’ confidential records. Tuaolo then said that there were even claims during election time that he and his wife, Pa’i, have a $1 million loan that was “charged off” by DBAS.

“For the record, Pa’i and Tuaolo do not have any loan with DBAS. And we have no loan that was charged off. And we have no loans at all the banks here,” Tuaolo declared and then asked, does “Tulaga Stanley” work at DBAS and the reply was “no”.

The infamous name of Tulaga Stanley was widely known prior to the Nov. 8th election, with salacious and sometimes, very troubling and unsubstantiated, postings on a Facebook page, which appeared to attack the Lolo Administration and its supporters.

The rumor mill spread like wildfire and the “ualesi moso’oi” worked overtime with people being accused by others of being “Tulaga Stanley”, and whose postings were so popular that it became a priority for many to read it first thing in the morning and keep track through to the wee-hours of the next day. It was even suggested that the postings were not the work of one person, but of a group of people — male and female.

Samoa News notes that “Tulaga Stanley” Facebook page postings came to a halt right after Nov. 8th.

During the confirmation hearing, Sen. Paepae Iosefa Faiai claims that it was Tulaga Stanley’s social media posting which publicly released names and information on the “charge off” or the freeze that was placed on customers not paying the interest on their loans.

Asked by Paepae as to how much the bank lost from freezing the interest payments, Matagi-Fa’atili said about $400,000 and pointed out that the freeze was for one-year only in 2010. No one asked and Matagi-Fa’atili didn’t say as to how many loans were given this preferential treatment in 2010.

She also said that since she has been at the helm of DBAS — in the last four years — there was no “charge off” of loans and the current board has halted this practice while DBAS and its attorney work to “exhaust all the measures of collecting before we even charge off” a loan.

An interesting question, which has been the subject of private discussions by many in the committee, came from Sen. Magalei Logovi’i regarding foreclosure by DBAS when a person fails to pay the loan.

Magalei asked what happens if the bank forecloses on a home, which is built on “communal land” — who gets the home?

She explained that if the home is built on communal land, the bank cannot “foreclose” on it, but the DBAS attorney works with the family sa’o for the balance of the loan to be repaid and once it’s paid off, then its up to the sa’o of the family and the person who made the loan as to who takes over the house. She said the mortgage documents are released with the name of the person who loaned the money from DBAS.

DBAS’ operating budget is $2.7 million and the latest copy of the profit and loss statement will be provided to the Fono — as required by law.

Matagi-Fa’atili’s confirmation was before the Senate Government Operations Committee and its chairman is Sen. Galeai M. Tu’ufuli, who wasn’t able to make it to the confirmation hearing; as a result, the nearly 45-minute long hearing, was chaired by committee vice chair Sen. Nuanuaolefeagaiga Saoluaga T. Nua — who is also the DBAS board chairman.

Nuanuaolefeagaiga, who also chairs the Senate Rules Committee, didn’t interject or object to any of the senators’ questions and all senators present at the hearing were given the chance to ask a wide range of questions.