Gatchalian, Pichay face criminal raps over bank buyout

/ 05:15 PM July 13, 2016

Ombudsman Conchita Carpio Morales has ordered the filing of criminal charges against Sen. Sherwin “Win” Gatchalian and 24 other individuals over their involvement in the allegedly anomalous buyout of an insolvent bank by the Local Water Utilities Administration (LWUA) in 2009.

The Ombudsman charged Gatchalian with one count of violation of Section 3(e) of Republic Act No. 3019 or the Anti-Graft and Corrupt Practices Act, one count of Malversation of Public Funds as defined under Article 217 of the Revised Penal Code, and one count of violation of the Manual of Regulation for Banks (MORB).


The neophyte senator was indicted as a former corporate executive of the Wellex Group Inc. (WGI) which co-owned the Express Savings Bank Inc., (Esbi), a local thrift bank based in Laguna owned by their family. Esbi was acquired by LWUA.

Former LWUA chair and Surigao del Sur Rep. Prospero Pichay Jr. was also charged with three counts of graft, three counts of malversation, one count of violation of MORB and one count of violation of Republic Act 8791 or General Banking Law of 2000.


Other named respondents in the graft, malversation, and MORB charges were:

· Former LWUA officials Eduardo Bangayan, Wilfredo Feleo Jr., Daniel Landingin, Enrique Senen Montilla III, and Aurelio Puentevella

· WGI corporate executives Yolanda dela Cruz, Dee Hua Gatchalian, William Gatchalian, and Kenneth Gatchalian;

· Esbi executives Edita Bueno, Wilfred Billena, George Chua, Gregorio Ipong and Generoso Tulagan; and

· Forum Pacific Inc. (FPI) executives Evelyn dela Rosa, Rogelio Garcia, Weslie Gatchalian,, Lamberto Mercado Jr., Joaquin Obieta, Arthur Ponsaran, Peter Salud, Elvira Ting, and Geronimo Velasco Jr.

The five former LWUA executives were also named coaccused with Pichay in violation of RA 8791.

According to the information filed by the Ombudsman with the Sandiganbayan, the LWUA approved the acquisition of the the insolvent bank in 2009 despite suffering net losses and capital deficits for five straight years from 2005 to 2009.


The LWUA officials bought 445,377 Esbi shares worth P101.363 million from the Gatchalian group that gave the agency 60-percent equity in the bankrupt bank.

Pichay and other executives later funneled P780 million from LWUA funds to Esbi’s authorized capital stock.

The Gatchalians of the Wellex group and those from FPI allegedly received P80 million for the acquisition.

‘Politically motivated’

In an interview on Wednesday, Pichay slammed the criminal charges filed against him as “politically motivated,” branding Morales as a loyalist of the former Aquino administration.

“Alam niyo naman yang Ombudsman, dilaw ‘yan eh. As you know, I am very much identified with GMA (Gloria Macapagal Arroyo). Because of that, cases are filed against me in the same way that they are persecuting GMA.

The former LWUA chief said that he is confident that he would be exonerated.

“The complaint is pure stupidity,” he said.

Only 14 shares

The neophyte senator reiterated his claim that he had only 14 shares in Esbi which would amount to a measly P2,514.82.

He expressed confidence that he will be acquitted by the Sandiganbayan.

“During my 15-year career in public service, I have never had any allegations of corruption or abuse of power thrown my way. I am confident that the Sandiganbayan will vindicate my honor and put this issue to rest once and for all,” Gatchalian said in a statement.

He also slammed the Office of the Ombudsman for supposedly wasting taxpayer money and devoting hours for a “fruitless” investigation.


Gatchalian, Pichay face Sandigan trial for graft

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TAGS: Express Savings Bank Inc., Graft, Local Water Utilities Administration, malversation, Manual of Regulation for Banks, Prospero Pichay Jr., Sherwin Gatchalian, Wellex Group Inc.
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