‘NFA gave legal cover to smugglers’

Top officials of the National Food Authority including its former administrator Lito Banayo (inset) gave big-time smugglers legal cover in importing rice using farmers’ cooperatives as fronts, an investigation of rice smuggling in the country showed. INQUIRER PHOTO/RAFFY LERMA

MANILA, Philippines–Top officials of the National Food Authority (NFA) gave big-time smugglers legal cover in importing rice using farmers’ cooperatives as fronts, an investigation of rice smuggling in the country showed.

Former NFA Administrator Lito Banayo, his deputy administrator Jose D. Cordero, suspected smuggler David Bangayan/Tan and three others are among those set to be charged with economic sabotage and violation of the Anti-Graft and Corrupt Practices Act in the Department of Justice (DOJ).

“The NFA officials signed the import permits, which provided the legal cover for the suspected rice smugglers,” said a source privy to the results of the probe conducted by state investigators.

Appointed by President Aquino in July 2010 as NFA head, Banayo resigned on Sept. 30, 2012, in the wake of reports of massive rice smuggling in the country.

He stepped down reportedly to run for congressman in the 2013 midterm elections in the first district of Agusan del Norte province.

Also to be charged with rice smuggling in the DOJ are couple David and Judyline Lim, owners of DGL Commodities, DGL Trucks and D-Force Trucking, and Leah Echeveria of Mandaue City.

Echeveria is the suspected conduit between the farmers’ cooperatives and the suspected rice smugglers.

A probe of 26 farmers’ cooperatives led investigators to recommend the filing of charges against the two former NFA officials and the alleged rice smugglers.

“The member of the cooperatives pointed to Bangayan and the Lim couple as the financiers of their import quotas through Echeveria,” said the source, who asked not to be named because he was not authorized to talk to the media about the matter.

The source said investigators found that Bangayan and Lim used the farmers’ cooperatives in two ways.

“They used the cooperatives as dummy to acquire import permits and also used them as dummy to extract seized cargoes,” the source said.

Justice Secretary Leila de Lima told the Senate committee on agriculture in January that Bangayan, aka David Tan, controlled the importation of rice by financing farmers’ cooperatives that wanted to bid for import permits from the NFA.

NFA complicity

The source said that the complicity of NFA officials in the illegal activity was also traced to the granting of memorandums of undertaking to farmer cooperatives that were used as vehicles for the release of seized imported rice.

The source also said members of cooperatives were paid a commission of at least P10 for every sack of rice.

“They admitted that businessmen borrow their import permits and pay all the dues and were given commission in exchange for the paper,” the source said.

Based on the statements of the members of the farmers’ cooperatives the financiers facilitated the documents needed for the bidding of import permits.

Bank account, bond

Apart from providing the cash to open a bank account under the name of a cooperative, the financiers also provided the “bond” required by the NFA to the winning cooperative before an import permit was issued.

The NFA allowed farmers’ cooperatives to buy rice from abroad after it ended government-to-government rice procurement.

To cover any shortfall in rice production and to increase the country’s buffer stock, the agency bid out the permits to import the grain. The NFA is the sole authorized rice importer in the country.

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