WHAT WENT BEFORE: The AFP-RSBS fund scam

In 1999, the Senate blue ribbon committee recommended to government prosecutors to file charges against Brig. Gen. Jose Ramiscal Jr., former president of the Armed Forces of the Philippines-Retirement and Separation Benefits System (AFP-RSBS), for granting special favors to private investors, as a “willing patsy” for Gen. Lisandro Abadia, former AFP chief of staff, to enable them to use RSBS funds.

The AFP-RSBS was established in 1976 as a pension fund for soldiers. It was funded from soldiers’ contributions.

RSBS invested heavily in real estate, making itself vulnerable to the 1997 financial crisis.

In 1998, RSBS losses called the attention of the Senate blue ribbon committee, which conducted an inquiry into the pension fund.

The committee found that RSBS had favored certain companies and formed joint ventures with real estate companies headed by Abadia. The companies reportedly received P2 billion in loans from the RSBS.

In September 2010, the Sandiganbayan arraigned Ramiscal on graft charges involving a P158-million land deal in General Santos City.

Court records show that then South Cotabato Rep. Luwalhati Antonino filed graft charges in the Office of the Ombudsman against Ramiscal and 27 others in December 1997 over alleged grossly overpriced acquisition of a 15,020-square-meter property in the city.

In her complaint, Antonino said Ramiscal and his coaccused bought the property, which was covered by 12 deeds of sale, at P10,500 per sq m.

But when Nilo Flaviano, the lawyer for the lot owners, presented the transfer of certificates of titles to the Registry of Deeds in General Santos, the documents showed that the property was actually sold at only P3,000 per sq m.

After conducting a preliminary investigation, the Ombudsman on Jan. 20, 1999, brought graft and falsification charges against Ramiscal and several others for shortchanging the government by close to P113 million in the land deal.

In June 2011, the Sandiganbayan convicted Ramiscal and three other officials of RSBS of graft for disbursing P1.53 million for a property in Tanauan, Batangas, which was sold for only P227,460. The four officials were sentenced to six to 10 years’ imprisonment and directed to pay the AFP-RSBS P1.304 million.

In July 2016, Ramiscal and five others were convicted of malversation through falsification for the execution of a fraudulent deed of sale to make it appear that RSBS paid P341.34 million for four parcels of land in Barrio Makiling, Calamba City, Laguna. The value of the land was declared to be only P91.02 million in the Bureau of Internal Revenue.

In May 2017, the Sandiganbayan convicted Ramiscal anew, this time for graft over the irregular release of P24.2 million in advance payments to Bay Resources Development Corp. (Bradco) in December 1995.

The funds were released to pay for taxes on the RSBS purchase of reclaimed land from Bradco, which was supposed to pay the taxes under the sale agreement.