Coopeservidores use loan savings schemes and channel them to social capital

However, after the financial collapse, he discovered that the savings he had accumulated over the past eight years showed up on his account statement as Current savingswhich is effectively the co-operative’s capital contribution. As a result, a total of £5.3 million was used to cover the entity’s losses due to loan defaults, affecting 131,500 members who collectively had nearly £64 billion in the entity.

“When I took out the loan, they told me that I was also making compulsory savings, but they never explained to me that this was social capital. They even told me that when I paid off the loan, the money would be mine and I could claim it after a year. I imagined that I had some resources there. I didn’t know until after what happened (the intervention),” said Doña Marianella.

However, the savings plan used by Coopeservidores in its credit operations is part of the institution’s assets, as confirmed nation The entity’s Resolution Management Department, headed by Marco Hernández.

“In effect, current savings enter the social capital of the cooperative,” it said in writing.

For Adriana Rojas Rivero, a lawyer at the Debtors Defense Association (Aprodeco), who is handling the case of Ms. Mariana and others, the case is one of possible abuse, also known as misuse, by financial entities such as savings and credit.

“The client was only verbally informed that the savings were part of the credit contract. There was no written contractual provision that the interest would be used as the private partner’s contribution, so we were faced with abusive practices. Promoting competition and effective consumer protection lawsr to prove that such assumption is prohibited and compensable,” the attorney explained.

Roxas maintained that members of the financial institution were forced to make regular savings as part of the financing process, but did not specify where the resources went.

Visited: Lawyer Adriana Rojas: “Coopeservidores force colleagues to save capital”

The Coopeservidores and the Public Bank (BP) Resolution Administration denied last Friday, August 9, that the social capital of the cooperative was part of a “good bank” absorbed by the financial entity. Both institutions rejected the explanation given by Aprodeco’s lawyers.

BP does not expect to recognise any capital contribution payments under the current absorption process as expected losses from the deterioration of the credit portfolio consume all equity capital, they said in a joint statement.

BP Legal Director Ricardo Azofeifa explained that the capital paid into the cooperative was intended to cover losses, which became a reality when the entity became non-viable due to bankruptcy.

“The entity’s share capital is jointly and severally liable for the losses. Legally, there is no right to compensation, so it is important that the debtor fulfils its obligations to Banco Popular,” Azofeifa said.

In November 2023, Coopeservidores had a registered share capital of nearly £64 billion, but this money has been consumed by outstanding loans.

The National Financial System Supervision Commission (Conassif) ordered the cooperative to intervene on May 13, following irregularities in loan management, non-collection of debtors and suspected falsification of financial data. The decision was based on two Sugef reports.

The organization was subsequently declared non-viable on June 21, and the Board gave those in charge of the resolution process up to two months to complete the transfer of assets in good condition and the negotiation of a margin of all £6 million to a solvent financial institution. BP was the chosen institution and is taking over 80.5% of the assets and liabilities of the “good bank.”

Compensation Claim

Roxas explained that they are currently gathering information and will subsequently file a claim through administrative channels with the Public Bank Audit Office.

“It is necessary to prove that Public Bank refused to offset the credit (with savings). The central bank has informed that it does not want to compensate, but we need to exhaust administrative avenues,” he pointed out.

The lawyer added that if BP dismisses the petition, the case will go to the controversial administrative court.

One of the main pieces of evidence they have is the account statements of Coopeservidores members, in which capital contributions classified as current savings appear. “It’s either savings or capital. It can’t be both,” Rojas pointed out.

The attorney stressed that it is crucial to keep the credit operations up to date during this process, as the debtor can have information on everything from their accounts at other financial institutions to seized assets.

Danilo Montero, Executive Director of the Financial Consumer Office (OCF), commented that in the current Coopeservidores process we could be facing a gray area where the institution does not clearly inform its partners about where the money given in the disbursement of the loan goes. He stressed that there could also be a situation where the person does not understand the quality of his contribution or, if aware, wants to fight.

“The fundamental question is whether the person knew but did not accept it. Or, if the member did not know at all, or worse, the cooperative never clarified what the risk profile of the contribution was,” Montero said. The economist stressed that many of the entity’s cases will undoubtedly end up in court.