Genuino, 6 other former Pagcor execs, charged

Efraim C. Genuino INQUIRER FILE PHOTO

MANILA, Philippines—The Office of the Ombudsman has ordered the filing of multiple counts of malversation and graft charges against Efraim Genuino, the former chairman of the Philippine Amusement and Gaming Corp. (Pagcor), and six Pagcor board directors, for the alleged misuse of the agency’s funds.

Ombudsman Conchita Carpio Morales found probable cause to indict Genuino, Rafael Francisco, Jose Benedicto, Rene Figueroa, Edward King, Ester Hernandez and Valente Custodio for malversation and violation of the Anti-Graft and Corrupt Practices Act arising from the promotion of the film “Baler,” a movie production deal between Viva Communications and Batas Iwas Droga Foundation (Bida).

Genuino’s son Erwin, who was a Pagcor executive assistant and the executive producer of “Baler,” was also ordered indicted for allegedly violating of the Code of Conduct and Ethical Standards for Public Officers and Employees.

Petition denied

In a resolution dated Feb. 25, 2013, Morales denied the respondents’ petition for the conduct of another preliminary investigation since, she said, they had all been given the opportunity to challenge the charges by the Department of Justice, which had conducted the preliminary investigation,

The Ombudsman said that the government effectively incurred a business loss when Pagcor advanced the cost for 89,000 movie tickets at P300 each, or a total of P26.7 million, which was contrary to the scheme approved by Pagcor to merely offer “Baler” movie tickets to casino patrons through the player tracking system (PTS) points.

According to the records, of the 89,000 tickets, only 16,850 were sold, leaving Pagcor to absorb the cost of 72,150 unsold tickets valued at P21.6 million, plus transmitted sales commission of P474,510.

This was on top of the P22.1 million in marketing expenses that was charged to Pagcor’s operating expense fund and P2.1 million for advertising expenses.

The Ombudsman noted that the documents relating to the deal were processed in just one day and the check payment released the next day.

It was also found that Bida and Pagcor had interlocking officers. Genuino, Benedicto, Francisco and King were alleged to be incorporators of Bida.

The resolution also found conflict of interest in the case of Erwin Genuino, alleging that Pagcor facilities and resources were used in the postproduction and promotion of the movie.

Probable cause

In the same ruling, Morales found probable cause to indict Genuino, King, Francisco, Figueroa, Hernandez and Custodio for 17 counts of malversation and 17 counts of violation of the antigraft law, this time for unlawful donations and payments.

The Ombudsman also found irregular the indiscriminate grant of cash advances or disbursements totaling more than P44 million from Pagcor’s intelligence funds—and upon reaching the allowable ceiling, charging the amount to the operating expenses realigned as intelligence funds—in favor of private entities like the Bida Foundation, Bida Production, Wildformat Inc., and Pencil First, “without any public purpose and without complying with legal and regulatory requirements.”

The Ombudsman also cited the “favored-son treatment” in transactions worth more than P50 million used by Bida to procure goods and services such as tarpaulin, shirts, caps, promotional items, stage production and sponsorship expenses taken from Pagcor funds.

An additional count of malversation and of violation of the antigraft law was charged against the six respondents for the trimedia advertising placements amounting to more than P63 million allegedly paid for by Pagcor to further Bida’s bid to become a party-list group.

Among the items alleged to have been funded by Pagcor were the holding of the “Grand Bida March,” the showing of a 13-episode animation series, and the distribution of comic books. These activities, conducted in 2008 and 2009, were enumerated in Bida’s petition for party-list accreditation with the Commission on Elections.

Rice for campaign

In another case, Morales ordered the filing of malversation charges against Genuino and King in connection with Pagcor’s shouldering the cost of forwarding, storage and brokerage of 300 metric tons of donated rice that were allegedly diverted into the mayoral campaign of Genuino’s two sons in the 2010 elections.

A Japanese firm had donated the rice to the Philippine government for the victims of Typhoon “Frank” in 2008.

The 300 MT of donated rice worth P1.4 million were allegedly repacked into smaller bags bearing the images and political slogans of the brothers Erwin and Anthony Genuino and distributed in Los Baños, Laguna, and Makati City where the two were candidates.