Corruption, power struggle mar PCGG work in 2008

By ZAFF SOLMERIN/BUSINESS MIRROR

Posted at Jan 05 2009 09:57 AM | Updated as of Jan 05 2009 05:57 PM

Allegations of corrupt practices and power struggles have marred the leadership of the Presidential Commission on Good Government (PCGG), and the continuing internal conflicts could erode public confidence in the effectiveness of the agency to fulfill its mandate to recover ill-gotten wealth of the late strongman Ferdinand Marcos and his cronies here and abroad.

PCGG will be turning 23 years on February 28, 2009, having been set up  after Marcos was forced to leave the presidency he held for over two decades—14 of them as strongman—on the fourth day of the Edsa Revolt, a church-backed, military-initiated but civilian-driven mass action.

Under the administration of the first post-Edsa President Corazon Aquino, the good government office was first led by former senator Jovito Salonga, followed by Ramon Diaz, Adolfo Azcuna (who served only for one month), Mateo Armando Caparas  and David Castro.

During the Ramos administration, Magtanggol Gunigundo was the only PCGG chairman—serving from 1992-1998 without being replaced. The administration of Joseph Estrada saw two appointees, Felix de Guzman and Elma Magdangal.

When President Arroyo rose to power in 2001 after Estrada was forced to step down at Edsa 2, she appointed the widely respected feisty lawyer Haydee Yorac as PCGG chairman; Yorac died in 2005 and was replaced by Camilo Sabio.

Smooth start, but….

Sabio’s watch in the PCGG started smoothly, but became rocky after allegations came out regarding corruption by some PCGG commissioners and government nominees in some sequestered and surrendered corporations. The most conflict-ridden was the Philippine Communications Satellite Corp. (Philcomsat).

Administration senators like Juan Ponce Enrile, now Senate President, and Richard Gordon had accused some PCGG officials, particularly Commissioner Ricardo Abcede and government nominees such as Enrique Locsin of making Philcomsat their “milking cows.” Abcede and Locsin separately denied such allegations, and the word war and legal tussle is ongoing.

In 2006, the Senate issued an arrest warrant and detained Sabio for refusing to answer questions—by invoking Executive Order (EO) No. 1, Section 4(b)—on whether he had the authority from the President to enter into a compromise agreement with the camp of businessman Eduardo Cojuangco Jr. on the multibillion-peso 27-percent shares of the coconut-levy fund in San Miguel Corp., Asia’s biggest food and beverage firm.

Some senators were also angered by Abcede’s advocacy of forging a compromise deal with the Marcoses.

Aside from these issues, the PCGG was also rocked with controversies such as the P10.35-million cash advance made by Sabio in 2006 from the Mid-Pasig Land Development Corp., a Marcos asset surrendered by J.Y. Campos which manages the 14-hectare “Payanig sa Pasig”.

The still-unliquidated funds were part of the P50 million remittance made by the Independent Realty Corp., another surrendered asset, to the PCGG.

Since 2006, the Presidential Anti-Graft Commission (PAGC) has been investigating the issue but has yet to come up with results. And, only last October, the Office of the Ombudsman started looking into the fund mess on the basis of a complaint filed by the PCGG Employees Association and PCGG Special Legal Counsels.

Use of funds questioned

The PCGG leadership was also rocked by questions on the use of government funds.

Justice Secretary Raul Gonzalez himself took the initiative to investigate the nearly $1-million foreign travel expenses of the Office of the Chairman from January to June 2008. The Ombudsman is also looking into the complaint.

The expenses, more than half of the P87-million 2008 PCGG budget, were drawn from the $59-million sequestered Marcos funds deposited in escrow at the Philippine National Bank, which the PCGG calls its “litigation fund.”

Gonzalez had ordered Sabio and other commission officials and employees involved in foreign trips to submit in 10 days their “comprehensive report”.

With a view to hastening the resolution of Marcos cases, Arroyo issued EO 643 in July 2007, placing PCGG under the direct administrative supervision of the DOJ.

EO 643 came at a time when “internal conflict” was already rocking the PCGG.

Because of allegations that he “masterminded” the filing of a complaint on a P10.35-million fund scam before the PAGC, Commissioner Nicasio Conti was also caught in the crossfire.

Twice, Sabio allegedly tried but failed to ask for the head of Conti from the President.

Sometime in February last year, Sabio presented to the President former commissioner William Dichoso as Conti’s replacement, to the humiliation of the latter, who immediately filed his irrevocable resignation after the incident. He was told to stay.

Sabio became controversial as well when his name was dragged in the bribery scandal where his brother, Associate Justice Jose Sabio Jr., became a whistle blower. In the course of the investigation by a special committee formed by the Supreme Court,  in the legal battle between the Government Service Insurance Service and the Manila Electric Co., Justice Sabio mentioned that he learned that the Meralco case had been raffled off to his division after he got a phone call from PCGG’s Sabio.

The Supreme Court had ordered disbarment proceedings to be initiated against Sabio for “impropriety” for supposedly advising  his brother about the correctness of GSIS’s position.

The controversy led to the filing of indefinite leave of absence by Sabio. On September 29, Arroyo appointed Comissioner Narciso Nario as officer-in-charge of PCGG.

While on leave, Sabio continued to report as chairman of the Coconut Investment Industry Funds, a subsidiary of the United Coconut Planters Bank.

When Nario started to introduce some basic reforms in the internal affairs of PCGG, such as weeding out of nonperforming consultants, regulating excessive foreign trips, reviewing the processes of appointing government nominees in sequestered and surrendered corporations, strategizing legal maneuvers, among others, Sabio abruptly ended his leave and reclaimed his post on October 31.

But Gonzalez prevailed over Sabio to take another 30-day leave of absence. Sabio complied. He later also asked Gonzalez to ask the President to place PCGG back under PAGC, and not to allow Nario and “his cohorts” to lay their hands on the coco-levy case and the IRC.

Gonzalez, the PAGC and Executive Secretary Eduardo Ermita denied the request, saying such is the prerogative of the President.

On December 5, Sabio reclaimed his post and shuffled the assignments of the commissioners, which is now subject for review by Gonzalez.

Under the new assignment, Nario was placed in the freezer as head of the Research and Development Department, a position usually given to a director. A retired Sandiganbayan justice, Nario used to head PCGG’s Legal Department.

Abcede, former Asset Management Department (AMD) chief, was transferred as cocommissioner for legal together with Bautista, while Com. Tereso Javier took over as AMD chief.

Commission insiders say they are expecting more surprises from Sabio when work resumes this January. If so, it only means that the agency, tasked with a most sensitive job in the most inspired days of the post-Edsa revolution, is about to see its mandate frittered away even more so, and politics and fund squabbles ruling the place.