SC clears Enrile, other Marcos allies on behest loans
MANILA, Philippines — The Supreme Court has affirmed the Ombudsman’s decision to clear former Senator Juan Ponce Enrile and other allies of former President Ferdinand Marcos over the alleged behest loans granted to a sugar milling company in 1968 by the Philippine National Bank (PNB).
In a 15-page decision written by Associate Justice Jose Reyes, Jr., the high court’s second division denied the petition for certiorari filed by the Presidential Commission on Good Government (PCGG) seeking to set aside the resolution issued by the Office of the Ombudsman on December 29, 2006 and the order dated Aril 21, 2009, which dismissed for lack of probable cause the criminal complaints filed against the respondents.
Aside from Enrile, the Ombudsman also cleared the PNB Directors in 1968, namely Roberto Benedicto, Antonio Diaz, Ismael Reinoso, Simeon Miranda, Renato Tayag, Juan Trivinio, Cesar Virata, Jose Macario Laurel IV, and Jose Leido.
Also cleared were Rafael Perez and Felicisimo Gonzalo, both former PNB-Dumaguete branch managers, and the officers of Tolong Sugar Milling Company Inc. (TSMCI), namely Ramon Escafio, Herminio Teves, Evelina Teves, Lorenzo Teves, Catalino Noel and Lamberto Macias.
The High Court said the Office of the Ombudsman did not abuse its discretion when it dismissed the complaint for violation of the provisions of Republic At No. 3019 or the Anti-Graft and Corruption Practices Act filed by the PCGG.
“Simply stated, no grave abuse of discretion may be attributed to the Ombudsman merely because of its alleged misappreciation of facts and evidence,” the Court said.
TSMCI was one of the many companies subjected to scrutiny by the Presidential Ad Hoc Fact-Finding Committee’s Technical Working Group for possible prosecution due to behest loans.
The examination of the Technical Working Group (TWG) showed that on March 20, 1968, PNB granted TSMCI a stand-by irrevocable unconfirmed letter of credit in the amount of US$27,793,123.45 over P100 million to cover importation of sugar machinery and equipment in connection with the planned sugar central in Sta. Catalina and Bayawan, Negros Oriental.
The loan was granted under PNB Board Resolution No. 711, dated March 20, 1968. Records showed that the loan was secured by 51.2496 hectares of agricultural land; machinery and equipment, building and other improvements to be erected and/or installed in the company’s, milling site; 3,000 hectares of owned and operated sugar plantation; and joint and solidary surety executed by TSMCI’s officers.
However, upon examination, the TWG discovered that at the time of its incorporation on May 10, 1967, TSMCI only had subscribed capital stock amounting to P2,000,000, of which only P500,000 was paid-up; that it only had capitalization of Pl0,000,000; that the lands covered by the loans were appraised by PNB Dumaguete Branch at only P22,350; and that the two parcels were not titled or registered under the name of TSMCI.
The PCGG claimed that the TWG’s findings show that TSMCI’s account was a behest loan.
In dismissing the complaint, the Ombudsman held that the PNB Board of Directors “exercised proper caution to ensure the chances of payment and that the loan was not under-collateralized” contrary to the allegations of the PCGG.
It pointed out that the PNB Board even required TSMCI to increase its paid-up capital as one of the conditions for the loan grant. The PNP in Dumaguete had appraised the real properties offered by TSMCI in 1967 as security at P 111,172,493.80, which is more than sufficient to cover the amount of the loan.
The PCGG, in taking the case to the Supreme Court, said the PNB Board should not have approved the loan because the securities are not enough.
But the High Court, in upholding the Ombudsman’s decision said, “the PCGG merely highlighted the alleged scandalous disproportion of the assets and collateral offered by TSMCI with the amount of the loan without even stating the alleged acts committed by the respondents which constituted or exhibited manifest partiality, evident bad faith or inexcusable negligence.”
“As pointed out by the Ombudsman, the complaint-affidavit is bereft of sufficient allegation and relevant documents to support the charges therein,” the SC added.
Concurring with the ruling were Associate Justices Mariano del Castillo, Estela Perlas-Bernabe, Alfredo Benjamin Caguioa and Amy Lazaro-Javier. (Editor: Eden Estopace)
