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COA: 3 senators’ pork went to bogus NGO

JPE, Estrada, Revilla tied to P195-M scam

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Some P195 million in Priority Development Assistance Fund (PDAF) of three incumbent senators and a former congressman went to a questionable nongovernment organization in 2011, according to a report of the Commission on Audit (COA).

The PDAF, a pork barrel that funds pet projects of members of Congress, is a known source of kickbacks for lawmakers. Yearly, a senator is entitled to P200 million in PDAF and a member of the House of Representatives, P70 million.

The audit report identified Senate President Juan Ponce Enrile, Senate President Pro Tempore Jinggoy Estrada, Sen. Ramon Revilla Jr. and then Buhay Rep. Rene Velarde as the sources of the P206 million in PDAF for the Department of Agriculture that was released in several batches in 2009 and 2010.

Of the amount, P201 million was turned over by the agriculture department to ZNAC Rubber Estate Corp. (ZREC), a government-owned and -controlled corporation (GOCC), which in turn transferred P194.97 million to Pangkabuhayan Foundation Inc. (PFI).

Of the amount received by PFI, P74.69 million came from Enrile’s pork barrel, P106.7 million from Estrada’s, P9.7 million from Revilla’s and P3.88 million from Velarde’s, the COA said.

The COA report further said that the financial statements and income tax returns from 2006 to 2008 indicated that the government was PFI’s only source of funding.

Estrada seeks probe

Estrada confirmed that part of his PDAF went to the foundation during the Arroyo administration.

Estrada wants an investigation of how his PDAF was spent if indeed PFI was a bogus NGO.

Enrile withheld further comment until he had checked his records.

“I cannot make a statement. I will have to check records and facts,” he said in a short reply coursed through his media staff.

First time

“This is the first time I heard about ZNAC Rubber Corp. and Pangkabuhayan Foundation Inc.,” he added.

Revilla gave no comment. He sent word that he had yet to go through the records.

The COA said the offices of Enrile, Estrada, Revilla and Velarde all nominated the PFI as the beneficiary of the funds to implement its claimed livelihood projects.

Sought for comment, Enrile said this was the first time he heard of ZREC and PFI.

The ZREC is involved in commercial crop production, particularly rubber.

It operates a plantation on a 1,000-hectare property in Tampilisan, Zamboanga del Norte province. The ZREC uses the land owned by Zamboanga del Norte Agricultural College, under a usufruct agreement for 50 years.

The ZREC was formally incorporated and registered with the Securities and Exchange Commission on May 17, 1984. In 2010, it was on the list of 36 “underperforming” GOCCs that Cagayan de Oro Rep. Rufus Rodriguez wanted abolished.

Fake documents

The COA report reiterated its previous recommendation to ZREC to require PFI to refund P162 million “due to fabricated documents and forged signatures” it submitted for the liquidation of funds received from ZREC.

The COA also recommended that ZREC inform Enrile et al. “that PFI should no longer be granted any fund assistance and have it blacklisted.”

Livelihood projects

State auditors raised doubts on the legal personality of the recipient nongovernment organization which claimed to have been implementing livelihood projects and programs in Ilocos Norte in Luzon; Bacolod City, Negros Occidental; Aklan and Iloilo in the Visayas; and Camiguin, Sulu, Tawi-Tawi, Zamboanga City and Basilan in Mindanao.

Office address

The PFI listed its office address as No. 050 D&E Building on Roces Avenue corner Quezon Avenue in Quezon City. Its previous address was No. 31 Ignacio Avenue, North Susana Executive Village, Matandang Balara, Quezon City.

The COA report noted that PFI had five tax identification numbers (TIN) based on different documents submitted to various government agencies.

For example, PFI’s certificate of incorporation with the Securities and Exchange Commission (SEC) had TIN 006-728-526 but a different TIN 229-081-506 was reflected in the general information sheet, which it also submitted to SEC.

In the PFI’s certificate of registration with the Bureau of Internal Revenue dated April 26, 2007, it had TIN 251-538-626-000 but used TIN 026-723-526 in its income tax return for 2006 to 2008. However, a copy of PFI’s purchase request obtained by auditors showed its TIN as 004-574-001.

Questionable

“Based on the information above, the validity and accuracy of the documents submitted by PFI were doubtful which also put to question its legal personality,” the COA report said.

COA auditors had asked ZREC to explain the discrepancies in the information when informed of the audit findings but the auditors were told that ZREC could no longer contact Petronila A. Balmaceda, PFI president, and that she had not replied to its letter dated Jan. 27, 2011.

In PFI’s income tax return (ITR) for 2007 and 2008, the report said PFI paid an identical amount of P17,500. PFI declared P1.75 million in total income tax payable because it was indicated in the ITR that its tax payments for the first three quarters amounted to P1,732,500, the report said.

“However, there was no deferred income tax or prepaid income tax of P1,732,500 and income tax payable of P1,750,000 reflected in the financial statements for CY 2007 and CY 2008 which cast doubt on the ITRs and financial statements submitted,” the COA said.

No liabilities

In 2007, PFI declared total assets of P5,668,594. However, there were no recorded liabilities, thus the fund balance was equal to the total assets.

“Likewise, total receipts and disbursements for CY 2007 amounted to P48,000,000 and P43,000,000, respectively, thus excess of receipts over disbursements amounted to P5,000,000. The above amounts were also the figures indicated in the CY 2008 financial statements.

“In short, the financial statements for CY 2007 and CY 2008 were the same,” the report said.

It said that from the financial statements for 2006 to 2008 submitted by PFI, there was no property, plant and equipment account, “thereby casting doubt as to how the foundation operated its business without any office equipment, furniture and fixtures which are essential in carrying out the day to day operations of a company.”

Unqualified for state funds

Neither was there a declaration of PFI’s other related business, if any, “prompting auditors to declare that from the start, PFI should not have qualified for entitlement as a recipient of government funds even if it was nominated by Senators Enrile, Estrada, Revilla and Congressman Velarde to implement the programs/projects.”

The report reiterated its previous recommendation to ZREC that it request PFI to justify “why the water pumps, hand tractors, composting facilities, planting materials and vegetable seeds were purchased from supplier which were very far from the location of the projects.”

Estrada said he didn’t know the people behind PFI but acknowledged that it was an organization accredited by the Department of Agriculture.

“It was the DA that recommended it (to be a beneficiary of my PDAF),” Estrada told the Inquirer.

Before Aquino administration

Estrada said this was “way back” before President Aquino took office in 2010.

“Our function is only to identify projects. The funds never passed through us. That’s the case for all of us senators,” Estrada said.

On the report that the NGO was bogus, Estrada said: “Now, I want to join the investigation… I want to know where the people’s money went.”—With a report from Inquirer Research

First posted 12:03 am | Thursday, February 28th, 2013


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Tags: Congress , misappropriation , pork barrels , Priority Development Assistance Fund , Senate




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