Villar Land appraiser loses SEC accreditation over P1.33-T valuation

THE Securities and Exchange Commission (SEC) has revoked the accreditation of Villar Land Holdings Corp.’s appraiser, E-Value Phils, Inc., for failing to justify its P1.33-trillion valuation of the listed company’s properties.

The SEC Office of the General Accountant (OGA) also imposed a maximum penalty of P1 million for violating Republic Act No. 8799, or the Securities Regulation Code (SRC), and SEC Memorandum Circular No. 2, Series of 2014 (MC 2), or the Guidelines on Asset Valuations, the regulator said in a statement on Monday.

In a separate letter, the OGA directed Villar Land subsidiaries Althorp Land Holdings, Inc., Chalgrove Properties, Inc., and Los Valores Corp. to submit new appraisal reports after finding that the reports submitted by E-Value were unreliable and noncompliant with the International Valuation Standards (IVS).

The OGA also conducted an onsite inspection following the valuation of properties of three companies under the Villar Land group.

“Findings during the inspection revealed that the appraisal reports by E-Value were non-compliant with the globally recognized IVS. This constitutes misrepresentation under MC 2, which is in turn a violation of the SRC,” the SEC said.

According to MC 2, misrepresentation arises “when the report indicates compliance with the standards but is not supported by adequate documents or the supporting documents reflect otherwise.”

The SEC also noted that E-Value violated Section 54 of the SRC, “which provides for the administrative sanctions that may be imposed on companies for violation of the law and its rules or orders.”

“It is evident that [E-Value] failed to uphold the fundamental principles of independence, professional competence, and objectivity required under the [IVS] and the Code of Ethics and Responsibilities for Real Estate Practitioners,” the OGA’s letter said.

The OGA further noted that E-Value was unable to provide documents that served as the basis for its assumptions and valuation methodologies that led to the P1.33-trillion increase in Villar Land’s property valuations.

“The gravity of the misrepresentation was further underscored by the fact that Villar Land is a publicly listed company and such information was used by investors to guide their investment decisions,” it added.

“[T]he subject appraisal values were likewise adopted in the preparation and submission of the audited financial statements of VLHC’s subsidiaries, thereby extending the potential effect of the misstated valuations across the corporate group and compounding the risk of misleading the investing public,” the letter said.

In its 2024 annual report posted on the Philippine Stock Exchange website last week, Villar Land set the final audited fair value of its newly acquired properties at P52.74 billion, sharply lower than the earlier estimate of P1.33 trillion.

Villar Land shares on Monday were down 29.93% or P337 to close at P789 apiece. — Beatriz Marie D. Cruz