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DoJ files syndicated fraud raps vs Meralco execs

No bail recommended

By Tetch Torres
INQUIRER.net
First Posted 18:14:00 08/22/2008

Filed Under: Crime, trial, Conflicts (general), Consumer Issues, Electricity Production & Distribution

MANILA, Philippines -- The Department of Justice (DoJ) on Friday filed syndicated estafa (fraud) charges against the 2006 officers of the Manila Electric Co. (Meralco) before the Pasig Regional Trial Court without recommending bail for any of the accused.

State Prosecutor Jose De Castro said their decision not to recommend bail is pursuant to Presidential Decree 1689, which makes syndicated estafa a non-bailable offense which carries a penalty of reclusion perpetua, or imprisonment of between 20 to 40 years.

The charges are based on a complaint filed before the DoJ by the National Association of Electricity Consumers for Reforms (Nasecore), which accused the power firm of misappropriating part of a multi-billion peso refund to its consumers.

Facing the charges are Meralco chairman and CEO Manuel Lopez, executive vice president and chief financial officer Daniel Tagaza, first vice president and treasurer Rafael Andrada, vice president and corporate auditor and compliance officer Helen De Guzman, vice president and assistant comptroller Antonio Valera, and senior assistant vice president and assistant treasurer Manolo Fernando;

2006 Meralco directors Arthur Defensor Jr., Gregory Domingo, Octavio Victor Espiritu, Christian Monsod, Federico Puno, Washington Sycip, Emilio Vicens, Francisco Viray and Cesar Virata.

De Castro said the Meralco officials failed to submit their counter-affidavit to Nescore?s complaint and that the DoJ had set a preliminary hearing twice but none of the accused showed up.

"We have no other choice but to resolve the complaint based on the evidence [the prosecutors] have at hand," De Castro said.

The case stems from an Energy Regulatory Commission (ERC) that the 10-percent meter and bill deposits Meralco charged, totaling some P21-billion, should be refunded to consumers.

The money was supposed to be kept in trust with the ERC while the agency drew up a plan to implement the refunds.

However, Nasecore said Meralco only allotted 6 percent per consumer, allegedly reclassifying the remaining 4 percent as "interest and other incomes."
The reclassification, said Nasecore?s complaint, "has the undeniable effect of converting the money collected from said subscribers into dividends or corporate profits which, by its nomenclature and nature, become income of the shareholders of Meralco. Having been reclassified as corporate income, the same ceased to become money of the subscribers to whom they lawfully belong."



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