NBI arrests Bangayan/Tan | Inquirer News

NBI arrests Bangayan/Tan

Alleged rice smuggler accused of power theft
By: - Deputy Day Desk Chief / @TJBurgonioINQ
/ 02:33 AM February 04, 2014

ARRESTED AND RELEASED. Davidson Bangayan, who is believed to be smuggler David Tan, is arrested by NBI agents for electricity theft after attending a Senate hearing on rice smuggling. The Senate has ordered him charged with perjury for denying he is David Tan. SENATE PHOTO/JOSEPH VIDAL

David Tan was finally arrested on Monday, but not as the alleged Goliath of rice smuggling but as the alleged electricity thief Davidson Bangayan.

National Bureau of Investigation agents arrested Bangayan in the Senate after a hearing on rice smuggling where he continued to deny that he was David Tan, who allegedly paid billions of pesos in bribes to Bureau of Customs (BOC) officials and employees to clear illegally imported rice through the ports.


But Bangayan spent no time in jail, as he was released after posting bail.

Bangayan avoided arrest last month because the warrant issued by a Caloocan City court in an electricity theft case stated that “David Tan is not Davidson Bangayan.”


But Justice Secretary Leila de Lima, speaking as a resource person at Monday’s Senate hearing, told the senators that the court allowed the enforcement of the warrant after witnesses, including one from  Manila Electric Co. (Meralco), testified that Davidson Bangayan and David Tan were the same person.

“We were advised by the executive judge that this original warrant of arrest, even if it says David Tan who is not David Bangayan, can serve now as basis for the immediate arrest of David Bangayan because of the additional proof that we have on the identity of David Bangayan,” De Lima said, adding that NBI agents were waiting to arrest Bangayan after the hearing.

Cited in contempt

Sen. Juan Ponce Enrile moved to cite Bangayan in contempt for lying about his identity to the committee.

Sen. Joseph Victor Ejercito seconded Enrile’s motion, and the committee approved it.

The committee on agriculture headed by Sen. Cynthia Villar directed the Senate legal department to bring perjury charges against Bangayan and recommended that he be barred from traveling out of the country.

To ensure that Bangayan will not be able to get out of the country, the committee recommended the cancellation of his passport.


De Lima said Bangayan had been put on the Bureau of Immigration’s watch list.

But since Bangayan had been attending hearings on the inquiry into rice smuggling, the committee did not send him to the lockup cell in the Senate building’s basement.

Bangayan sat stoically throughout the proceedings. Neither he nor his lawyers issued a statement on his arrest and citation for contempt.

He tried to fend off charges that he was a rice smuggler by claiming that import permits were being dangled for a price.

But that had nothing to do with electricity theft for which he had been ordered arrested, and after Meralco and De Lima made it clear that he was David Tan, NBI agents, who had been waiting in the wings, stepped in after the hearing and took him away.

Released after bail

NBI Director Virgilio Mendez said Bangayan had his mug shots and fingerprints taken, then he went to the Manila Regional Trial Court and posted P40,000 bail.

Mendez said Bangayan was released. He said the court ordered Bangayan’s arrest after the NBI showed evidence that Bangayan and Tan were the same person.

“One strong evidence to prove that the two names belong to only one person is the affidavit submitted by a Singaporean firm accusing Bangayan of smuggling garbage to India,” Mendez said.

In that affidavit, Bangayan affirmed that he uses the alias David Tan.

“We have witnesses and relevant documents to prove this,” Mendez said.

Customs bureau insiders told the Inquirer earlier that David Tan, who turned out to be Davidson Bangayan, was the point man in the smuggling of rice through the ports, with help from corrupt customs officials and employees.

A former customs official said Tan paid customs officials and employees P6 billion in bribe over the last two years to get his illegal rice consignments out of the ports.

He said Tan used farmers’ cooperatives in his operation, financing their bids for import permits from the National Food Authority (NFA), paying for their expenses while preparing for the biddings, and giving them commissions on the sale of the rice.

JUSTICE SECRETARY AND DAVAO’S ‘DIRTY HARRY’. Justice Secretary Leila de Lima (left) attends the Senate hearing on rice smuggling where Davao City Mayor Rodrigo Duterte reiterates his warning to Davidson Bangayan, who he claims is smuggler David Tan, that he will shoot him if he sees him in his city. GRIG C. MONTEGRANDE

Tan’s operation is costing the government P7 billion in lost revenue every year and massive loss of opportunity for Filipino farmers whose paddy production is shunned by millers who prefer to buy smuggled rice, which comes in already milled and ready for repacking, according to the former customs official.

Coming out

Bangayan surfaced last month after seeing on television pictures of David Tan that looked like him.

He denied he was David Tan, but the Federation of Philippine Industries Inc., whose members had done business with him, identified him to the Senate investigators as Tan.

He must have forgotten it, but De Lima did not and told the committee about it at a hearing last month, that he had submitted an affidavit to the Department of Justice in another case that he also used the name David Tan.

De Lima also told the hearing that another witness had come forward and testified that Bangayan was the financier of his cooperative.

“There had been several occasions that they met face to face. He recounted one incident where groups of cooperatives lost a bidding and voiced their sentiments about the loss,” De Lima said.

“To appease these losing bidders, Mr. Tan personally met and told them that they had nothing to worry about because the winning bidders were also his companies, and promised them that whatever the income gained would be distributed pro rata among them,” she said.

‘The Punisher’

There was another resource person at Monday’s hearing who knew that Bangayan and Tan were the same person.

“Everybody here in this town and all over the Philippines knows he’s really David Tan,” Davao City Mayor Rodrigo Duterte told the committee.

Duterte had been summoned to the hearing after he threatened to kill David Tan if the alleged rice smuggler showed up in his city.

“He might use a thousand names, George Washington, Rodrigo Duterte or whatever, he’s the one doing business, committing smuggling as David Tan,” Duterte said.

Duterte, who claimed that police and military intelligence officers had identified Bangayan to be the same as Tan, warned Bangayan against bringing smuggled rice to Davao.

“If this guy would go to Davao and start to unload—if the commission will grant—I will gladly kill him and so, I’ll go to prison,” he said, adding that he was willing to spend the rest of his life in prison where he would while away time by reading books.

Duterte, once called “The Punisher” by Time magazine for his unconventional methods of fighting crime in Davao City, was in combative mood.

“Well, I’ll wait for him outside. If he gives a good fight, I will not hesitate. I’ll do it for my country,” he said when pressed by Sen. Jinggoy Estrada on his threat to kill Bangayan.

This should serve as a “stern warning” to smugglers, Duterte said.

Central figure

Quoting his intelligence sources, Duterte said Bangayan was the “central figure” in rice smuggling.

“Whoever wants to import, they go to David Tan. He has a line to Customs. He’s the financier,” Duterte said. “They say there are three David Tans. He’s the only one.”

It was Duterte’s testimony on Bangayan’s identity that prompted Ejercito to second Enrile’s motion to cite the alleged rice smuggler for contempt.

After the contempt decision by the committee, Ejercito pressed Bangayan to identify other big-time rice importers.

Bangayan replied: “If we go back to the history of the system, in my opinion, because of the restrictions on import permits, this gave rise to operations like this. It’s common practice for permits to be sold.”

He was referring to the quantitative restrictions imposed by the World Trade Organization allowing the Philippines to limit the volume of rice that can be imported by the NFA.

Bangayan explained that in 2012, his group was involved in the importation of “only 7 percent” of the 380,000 metric tons of rice. He said there were 200 participants in the bidding for import permits.

In 2012, some 800,000 MT of rice were smuggled into the country worth P16.8 billion. This translated to P8.4 billion in lost revenue for the government.

Permits for sale

Bangayan declined to answer questions after the hearing.

Former Anakpawis Rep. Rafael Mariano said Bangayan’s disclosure that rice import permits were being offered for  sale was “[not] surprising.”

NFA Administrator Orlan Calayag said he had heard of the sale of import permits before he took office in early 2013. But he said reforms had been undertaken to deal with the irregularity.

Agriculture officials maintained that Bangayan was not a registered rice trader. Even so, he tried to import 120,000 MT of rice from Vietnam in October 2013 through one of his corporations, Adolphe Inc.

Senator Villar read a letter from the Vietnam Embassy about Bangayan’s attempt to import rice.

The Vietnamese supplier, Vietnam Southern Food Co., did not act on the application because Adolphe failed to secure a rice import certificate from the NFA.

When Bangayan explained that he was merely inquiring, Villar told him to produce the contract with the Vietnamese supplier. He said he would.

A longtime broker in the BOC, Emmanuel Santos, admitted that he dealt with Bangayan in the importation of at least 5,000 MT of rice.

Answering questions from Enrile, Santos said he started out as a customs broker for different commodities when the senator was still customs commissioner beginning in the late 1960s.

Santos confirmed that he, Bangayan and Eugene Pioquinto were business partners in at least three companies. He said he and Bangayan also published a newspaper, Dyaryo Pinoy, but this went bankrupt.

On hearing this, Enrile remarked that they put out the paper to undermine critics of their activities.

Bangayan said he engaged in rice trading for two years, starting in 2011.

The committee threatened to cite in contempt Elizabeth Faustino, Judilyne Lim and Leah Echeveria, who were allegedly involved in rice trading, if they failed to appear in the next hearing.—With a report from Maricar B. Brizuela



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TAGS: David Tan, Davidson Bangayan, power theft, rice smuggling, Senate hearing
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