MANILA - Surigao del Sur Rep. Prospero Pichay Jr. has pleaded not guilty to charges related to an anomalous banking deal between the Local Water Utilities Administration (LWUI) and Express Savings Bank Inc (ESBI) of the Gatchalian family during his time as the state agency's chair.

Pichay is facing three counts of violation of Section 3(e) of the Anti-Graft and Corrupt Practices Act and one count of violation of the Manual of Regulation for Banks.

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The charges against Pichay stemmed from LWUA's acquisition of ESBI for P80 million pesos.

Investigation conducted by the Office of the Ombudsman showed that the LWUA board headed by Pichay passed a resolution approving the acquisition of ESBI without the necessary approvals from the Monetary Board of the Bangko Sentral ng Pilipinas, the Department of Finance, and the Office of the President.

After Pichay's arraignment, the anti-graft court scheduled pre-trial on July 23.

The cases initially involved Sen. Sherwin Gatchalian, his father William, mother Dee Hua, and brothers Wesley and Kenneth.

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