4 ex-education fund execs get jail terms of 10 to 163 years for loan anomalies

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MANILA — The Sandiganbayan has convicted four former officials of the Fund for Assistance to Private Education (FAPE) on multiple graft and malversation charges over allegedly anomalous loans extended to the body’s president in the 1990s.

The court’s First Division on Jan. 26 found former FAPE president Adriano Arcelo guilty of seven counts of violation of Section 3(e) of the Anti-Graft and Corrupt Practices Act and five counts of malversation.

He drew prison terms of six to 10 years for graft and 10 years to 18 years and eight months for malversation, or a total of 92 to 163 years.

Meanwhile, former FAPE investment director Rosa Anna Duavit-Santiago was sentenced to 74 to 133 years’ imprisonment for four counts of graft and five counts of malversation.

Former vice-president Roberto Borromeo will serve 48 to 86 years in prison for three counts each of graft and malversation, while programs officer-in-charge Corazon Nera will spend 16 to 28 years for one count each of the same crimes.

The convicted officials were likewise held jointly liable for fines amounting to P6,554,500, which was equivalent to the personal loans granted to Arcelo from FAPE funds. The four were also perpetually barred from holding public office.

The case arose from the loans taken by Arcelo in five instances from February 1994 to January 1995, without the approval of the Private Education Assistance Committee, the trustee of the funds which finally acts on all grants and loans using the FAPE funds.

The same FAPE account was also the source of a P50-million loan agreement in February 1997 with John B. Lacson Colleges Foundation, whose executive committee was chaired by Arcelo’s wife, Mary Lou Lacson-Arcelo. Just like the personal loans before, this also did not come with the required approval of the PEAC.

The court rejected the defendants’ contention that FAPE was a commingled private fund that did not require the approval of PEAC. It ruled FAPE to be a government-owned educational foundation and its officials to be public officers covered by the graft law.

The decision noted that the funds that came from private educational institutions became public funds because they were placed under official custody for investment purposes.

It also said that the funds were earmarked for educational purposes and the advancement of private education. “Nowhere in the Investment Manual does it state that the external funds can be used for personal loans,” the decision read.

The court said Arcelo was in bad faith when he applied for personal loans, despite the prohibition by Executive Order No. 156, series of 1968, against the grant of the said loans.

“He is aware that his personal loans using FAPE funds run counter to the purpose of FAPE and yet, proceeded to apply for and benefited therefrom purely for his self-interest,” the decision read.

The other officials were held liable for reviewing and approving Arcelo’s loan applications, as it effectively favored him over other private individuals who did not have access to the funds. The court noted Duavit-Santiago’s admission that she did not know of other similar personal loans being extended.

A fifth defendant, former FAPE investments director Cipriano Garcia, remains at large.  SFM