POSTSCRIPT / December 11, 2007 / Tuesday

By FEDERICO D. PASCUAL JR.

Philippine STAR Columnist

Share on facebook
Share This
Share on twitter
Twitter

PCGG agents looting sequestered companies

TAN CASE: Taking off from the Supreme Court decision that there was no basis for the 1986 seizure of taipan Lucio Tan’s assets in four companies, including his flagship Fortune Tobacco Corp., the sequestration of other firms similarly taken over should be lifted too.

Upholding a Sandiganbayan ruling in favor of Tan and several others, the high court said the Presidential Commission on Good Government failed to prove that the shares in the companies were ill-gotten before it issued the sequestration orders.

The tribunal said in its Dec. 7, 2007, decision: “There is no evidence xxx that (the sequestered shares) belong to the Government xxx or any of its branches, instrumentalities, enterprises, banks or financial institutions.”

* * *

GOLD MINES: The insistence of the PCGG in keeping some companies sequestered is understandable when one considers the compensation, benefits and perks that the PCGG commissioners and their nominees get from these firms.

Take for instance the country’s once-premier satellite telecommunications company, the Philippine Communications Satellite Corp. (Philcomsat).

In 1987, the PCGG sequestered the shares of Roberto Benedicto, Jose Africa, Manuel Nieto, Honorio Poblador, Juan Ponce-Enrile and Potenciano Ilusorio in Philcomsat and its mother company, the Philippine Overseas Telecommunications Corp. (POTC).

The PCGG filed Civil Case No. 009 in the Sandiganbayan against them. Not content with sequestering the shares, the commission sequestered the two companies as well.

* * *

TINY BLOC: After 13 years of litigation, the only proof of ill-gotten wealth that the PCGG had was an admission by Marcos crony Jose Campos that two corporations — Independent Realty Corp. (IRC) and Mid-Pasig Land Development Corp. (Mid-Pasig) — owning about 40 percent of POTC and Philcomsat were Marcos-owned.

The Sandiganbayan ruled that 35 percent belonged to the government and 5 percent to Ilusorio. It directed POTC/Philcomsat to nullify the IRC and Mid-Pasig shares and issue them in favor of the Republic and Ilusorio. That was in January 2000.

Because of case dismissals and compromise agreements between the PCGG and the defendants, at present only 106 shares owned by Nieto and one share owned by Africa, out of the 13,527 total shares, or 0.78 percent of POTC/Philcomsat remain sequestered.

Is this enough to justify continued PCGG sequestration? Even with the government now the registered owner of 35 percent of equity, the PCGG continues to oppose the lifting of sequestration. The case is now pending in the Supreme Court.

* * *

LAND DEAL: The problems in the Philcomsat companies reportedly began with then President Joseph Estrada’s appointment in 1998 of Benito Araneta and Ronaldo Salonga as PCGG nominees (representing sequestered IRC and Mid-Pasig) to POTC and Philcomsat.

Araneta and Salonga got themselves elected to the board of unsequestered subsidiary Philcomsat Holdings Corp. (PHC), a Philippine Stock Exchange-listed company with P1 billion in money market trading.

The Araneta-Salonga board approved a P390 million disbursement to Araneta’s first cousin, Antonio “Tonypet” Araneta, to buy undeveloped land the titles of which are reportedly encumbered and subject to forfeiture for non-payment of realty taxes.

Because of the controversial transaction, both Araneta and Salonga were replaced as POTC/Philcomsat representatives in September 2000. Yet, they never left PHC.

* * *

TWO BOARDS: As if to protect the transaction, Araneta and Salonga, together with Nieto and his lawyer Luis Lokin Jr., continued to claim to be POTC/Philcomsat directors. They set up their own board, which was neither recognized by the PCGG nor did it have any operations.

The PCGG then worked with the other private stockholders, Poblador, Africa, Ponce-Enrile, Ilusorio and Benedicto and appointed new nominees to the POTC/Philcomsat boards.

So for two years, from 2000 to 2002, there was only one working and unified board of directors with both the government and private sector represented.

The unified board tried to gain control of PHC at its annual stockholders’ meeting in 2001, but when it presented its proxy to corporate secretary Roberto San Jose, he referred the matter to the PHC board still controlled by already fired Araneta, Salonga and Lokin.

As expected, the proxy of the unified board was invalidated and Araneta, Salonga and Lokin elected themselves and their cronies as PHC directors.

* * *

COFFERS RAIDED?: More problems cropped up at POTC/Philcomsat after Enrique Locsin was appointed, together with a Bicol farmer named Manuel Andal and Julio Jalandoni, to sit on the board of the telecommunications companies.

Instead of replacing the directors in the unified board and working with the private sector, Locsin and Andal joined the Araneta-Salonga rump boards of POTC/Philcomsat. They got themselves elected as PHC directors.

Thus, PHC had a board consisting of PCGG nominees, past and present. Curiously, PHC is not even a sequestered corporation.

* * *

EVEN THE COURTS?: The PCGG and its nominees, Araneta, Locsin and Andal, have been accused of raiding the company coffers teeming with a cash fund of almost P1 billion.

There are records showing they gave themselves compensation, including a P15 million and P11 million salary to Locsin and Andal for two years, from 2003 to 2005, housing loans, car loans and P16 million in representation and entertainment expenses.

Their cronies, documents show, would likewise benefit from the same generosity with Philip Brodett receiving P11 million, Johnny Tan P8 million and Lokin P12 million, all in just one year.

Cases filed against PCGG nominees were met with corresponding expenses shouldered by PHC such as “representation to Supreme Court” for TRO, “Gift for PCGG commissioner,” “Cash PCGG gift” and “Cash for Sandiganbayan TRO” totaling in the millions.

* * *

(First published in the Philippine STAR of December 11, 2007)

Share your thoughts.

Your email address will not be published.