Pichay guilty of graft over P780 million LWUA funds misuse
MANILA, Philippines — Surigao del Sur 1st District Rep. Prospero Pichay has been found guilty of three counts of graft by the Sandiganbayan for the misuse of more than P780 million from the Local Water Utilities Administration (LWUA) during his tenure as its chairperson.
The anti-graft court’s Fourth Division has sentenced Pichay and former LWUA financial service head Wilfredo Feleo Jr. to serve six to 10 years of imprisonment for each count of graft conviction. The two are also perpetually disqualified from holding public office.
INQUIRER.net has sought the side of the lawmaker, but Pichay’s camp has not yet issued a reply as of this posting.
In a decision dated June 7, the Sandiganbayan’s Fourth Division said Pichay and other officials of the LWUA gave unwarranted benefits and preferential treatment to the Express Savings Bank Incorporated (ESBI) owners and incorporators when LWUA either deposited funds or purchased shares of stocks from the bank.
A copy of the decision was released to the media on Thursday.
On the first count of graft filed by the Office of the Ombudsman, the court said Pichay and Feleo allowed the purchase of 445,377 shares worth P80 million. This gave the agency a 60 percent share in ESBI’s stocks.
On the second count and the third count, the court said LWUA funds worth P300 million and P400 million were deposited to ESBI on two occasions even without the approval of the Monetary Board, Bangko Sentral ng Pilipinas (BSP), Department of Finance (DOF), and Office of the President (OP).
According to the Sandiganbayan division, Pichay claimed that the third element of graft – acting with manifest partiality, as stated in Republic Act No. 3019 or the Anti-Graft and Corrupt Practices Act – was not present as no other bank was involved in the transactions.
But the anti-graft court noted that Pichay “conveniently brushed aside” the requirements – that the Monetary Board, BSP, DOF, and OP should first approve such transactions.
“The records of the case bear witness to the repeated reminders of the different government offices to seek appropriate approval from banking regulators before LWUA proceed with its resolution to create a bank or acquire an existing financial entity to carry out its mandate as a specialized lending entity,” states the decision penned by Fourth Division member and Associate Justice Lorifel Pahimna.
The anti-graft court also pointed out that when Pichay notified BSP about LWUA’s agreement with ESBI on the acquisition of 60 percent of the bank’s shares, the Central Bank advised LWUA that such a movement requires approval from the Monetary Board, endorsement from the DOF, and final approval from the OP.
“Thus, it cannot be denied that accused Pichay and Feleo knew of this requirement as they have been in consultation with the [OP], DOF, and BSP. They were specifically advised to secure approval of the Monetary Board,” the decision points out.