SIXTEENTH CONGRESS OF THE REPUBLIC OF THE PHILIPPINES First Regular Session

) ) )

S E N A T E

COMMITTEE REPORT NO !!!!!!!!!!

Submitted by the Committee on Accountability of Public Officers and Investigations (Blue Ribbon) on _______________
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Re"

Pro!osed Senate Resolution "o #$ of Senator %rancis &ose!h 'Chi() *scudero+ Pro!osed Senate Resolution "o $,, of Senator -iriam .efensor Santiago+ Pro!osed Senate Resolution "o $/0 of Senator A1uilino '2o3o) Pimentel+ Pro!osed Senate Resolution "o $/4 of Senator Alan Peter 'Com!a5ero) Cayetano+ Pro!osed Senate Resolution "o 06# of Senator &ose!h 7ictor *8ercito+ and Pro!osed Senate Resolution "o 09# of Senator -aria :ourdes "ancy Binay

Recommending its a!!roval

S#onsor" Senator ;eofisto ';<) <uingona III

MR PRESI$ENT" ;he Committee on Accountability of Public Officers and Investigations (Blue

Ribbon) has conducted an in1uiry= in aid of legislation= on the follo>ing referrals?

Pro#ose% Senate Resolution No &'= introduced by Senator %rancis &ose!h 'Chi() *scudero= entitled?

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RESOLUTION $IRECTING THE SENATE COMMITTEE ON ACCOUNTABILIT( OF PUBLIC OFFICERS AN$ IN)ESTIGATIONS *BLUE RIBBON) TO CON$UCT AN IN+UIR( INTO THE ALLEGE$ TEN BILLION PESOS PRIORIT( $E)ELOPMENT ASSISTANCE FUN$ *P$AF) SCAM IN)OL)ING THE ,ANET LIM-NAPOLES GROUP .ITH THE EN$ IN )IE. OF ENACTING LEGISLATI)E MEASURES TO A$$RESS THE SAME

Pro#ose% Senate Resolution No '//= introduced by Senator -iriam .efensor Santiago= entitled?

RESOLUTION $IRECTING THE COMMITTEE ON CONSTITUTIONAL AMEN$MENTS0 RE)ISION OF CO$ES AN$ LA.S0 TO CON$UCT AN IN+UIR(0 IN AI$ OF LEGISLATION0 ON THE SENSE OF THE SENATE THAT THE P$AF *PRIORIT( $E)ELOPMENT ASSISTANCE FUN$) SHOUL$ BE HAL)E$ IN 12'&0 THE REMAINING SUM TO BE HAL)E$ AGAIN IN 12'30 THUS PHASING OUT THE POR4 BARREL IN 12'5

Pro#ose% Senate Resolution No '61= introduced by Senator A1uilino '2o3o) Pimentel= entitled?

RESOLUTION $IRECTING THE PROPER SENATE COMMITTEE TO CON$UCT AN IN+UIR( IN AI$ OF LEGISLATION0 ON THE ALLEGE$ P'2-BILLION PRIORIT( $E)ELOPMENT ASSISTANCE FUN$ SCAM
Pro#ose% Senate Resolution No 'Com!a5ero) Cayetano= entitled? '65= introduced by Senator Alan Peter

RESOLUTION AUTHORI7ING AN$ $IRECTING THE COMMITTEE ON ACCOUNTABILIT( OF PUBLIC OFFICERS AN$ IN)ESTIGATIONS *BLUE RIBBON COMMITTEE) TO APPOINT A SPECIAL IN$EPEN$ENT IN)ESTIGATOR IN THE PERSON OF FORMER SENATOR PANFILO 8PING9 LACSON TO LOO4 INTO THE ALLEGATIONS OF CORRUPTION IN THE USE AN$ IMPLEMENTATION OF THE PRIORIT( $E)ELOPMENT ASSISTANCE FUN$
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*P$AF) B( LEGISLATORS .ITH THE IN$ISPENSABLE PARTICIPATION OF THE IMPLEMENTING AGENCIES AN$ THEIR BI$S AN$ A.AR$S COMMITTEES0 SOME NON-GO)ERNMENT ORGANI7ATIONS0 AN$ SUPPLIERS STRONGL( EN,OINING ALL SENATORS TO OPEN TO THE PUBLIC THEIR P$AF FINANCIAL RECOR$S IN THE SPIRIT OF TRANSPARENC(0 ACCOUNTABILIT(0 AN$ REFORM

Pro#ose% Senate Resolution No 12&0 introduced by Senator &ose!h 7ictor *8ercito= entitled?

RESOLUTION URGING HIS EXCELLENC(0 PRESI$ENT BENIGNO SIMEON C A+UINO III TO CREATE AN IN$EPEN$ENT COMMISSION TO IN)ESTIGATE THE MISUSE OF THE PRIORIT( $E)ELOPMENT ASSISTANCE FUN$ *P$AF) BASE$ ON THE FIN$INGS OF THE COMMISSION ON AU$IT .ITH THE EN$ IN )IE. OF PRO)I$ING RECOMMEN$ATIONS FOR THE APPROPRIATE USE OF PUBLIC FUN$S PURSUANT TO POLIC( OF TRANSPARENC( AN$ ACCOUNTABILIT(
Pro#ose% Senate Resolution No 13&0 introduced by Senator -aria :ourdes "ancy Binay= entitled?

RESOLUTION $IRECTING THE SENATE COMMITTEE ON ACCOUNTABILIT( OF PUBLIC OFFICERS AN$ IN)ESTIGATIONS *BLUE RIBBON) TO EXPAN$ THE SCOPE OF THE COMMITTEE9S IN+UIR( ON THE ALLEGE$ MISUSE OF THE PRIORIT( $E)ELOPMENT ASSISTANCE FUN$ *P$AF) TO INCLU$E THE GRANT AN$ RELEASE OF PUBLIC FUN$S B( NATIONAL GO)ERNMENT AGENCIES0 LOCAL GO)ERNMENT UNITS *LGUs)0 GO)ERNMENT-O.NE$ OR CONTROLLE$ CORPORATIONS *GOCCs) AN$ THEIR SUBSI$IARIES TO NONGO)ERNMENT ORGANI7ATIONS *NGOs) FOUN$ATIONS:PEOPLE9S ORGANI7ATIONS *POs)
;he Committee has the honor to submit its %inal Re!ort Recommending the ado!tion of the recommendations contained herein

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TABLE OF CONTENTS
' INTRO$UCTION $$ $0 Preliminaries Series of @earings on the P.A% Scam Page C C $$ $4 $4 $4

1 ANTECE$ENT FACTS 0$ Overvie> 0$$ 0$0 Priority .evelo!ment Assistance %und S!ecial Audits Office Re!ort on Priority .evelo!ment Assistance %und (P.A%) and 7arious Infrastructure Including :ocal Pro8ects (7I:P) Ob8ectives of the Committee Re!ort Sco!e of the Committee Re!ort

0$, 0$# 00 0,

$C $/ 06 06 00 00 0/ ,$ ,$ ,, ,C #$ ## #4 #C 9C 9/

P.A% .isbursement Procedure P.A% Scam 0,$ 0,0 0,, 0 0 0 0 0,# 0,9 , , , , Creation "egotiation Im!lementationA.iversion of %unds , , , , $ 0 , # Advance !ayment of 3ic3bac3s Pre!aration of the *ndorsement :etters Collection :i1uidation

S!litting of the :oot Bho receives 3ic3bac3s 0,9$ 0,90 0,9, :egislators Chiefs of Staff or Re!resentatives of :egislators Im!lementing Agencies

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0,4

@o> 3ic3bac3s are received 0,4$ 0,40 0,4, :egislators Chiefs of Staff or Re!resentatives of :egislators Im!lementing Agencies

4$ 4$ 4, 4# 44 4/

0#

In the interest of fair !lay

/ FIN$INGS ,$ Absence of an a!!ro!riation la> or ordinance earmar3ing certain amounts to be s!ecifically contracted out to "<Os Absence of "<O accreditation Absence of accountability in the monitoring of P.A%D funded !ro8ects Accountability of :egislators "<O Partici!ation in <overnment Pro8ects Accountability of Private Persons Certain legislators have committed a breach of duty to the !ublic Circumstances such as flight and barefaced denials belie the assertion of innocence

E6 E0

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E, E4 C6 C$

,# ,9 ,4 ,E

C,

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C# CE CE /9 /9 /C // //

& RECOMMEN$ATIONS #$ Prosecution ;he Bhistleblo>ers Ruby ;uason .ennis Cunanan Other Persons of Interest for %urther Investigation #0 A!!lication as State Bitness

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#,

Referrals #,$ #,0 Referral to Senate Committee on *thics F Privileges Referral to the Integrated Bar of the Phili!!ines (IBP) and the Su!reme Court for .isbarment or .isci!linary Proceedings against members of the :egal Profession involved

$6, $6,

$6# $69

##

Policy -easures ##$ ##0 ##, Institutionali(e realDtime audit of "<Os that receive government funds Blac3list "<Os andAor their incor!orators A officersA their !rivate sector !artners for any >rongdoing *nhance the su!ervisorial and regulatory functions of the Securities and *Gchange Commission (S*C) over nonDstoc3= nonD!rofit organi(ations ("SPOs) *nhance the su!ervisorial and regulatory functions of the Coo!erative .evelo!ment Authority (C.A) over coo!eratives Com!uteri(ation of a centrali(ed database on "<Os of the Securities and *Gchange Commission (S*C)= the Bureau of Internal Revenue (BIR)= the Commission on Audit (COA)= the Coo!erative .evelo!ment Authority (C.A)= the .e!artment of :abor and *m!loyment (.O:*)= the .e!artment of Budget and -anagement (.B-)= the .e!artment of Social Belfare= and .evelo!ment (.SB.)= and other !ertinent agencies Amend Commission on Audit Circular 066ED66$ in order to i) !rohibit "<Os= >hich have been in o!eration for less than three (,) years from being reci!ients of government funds and ii) re1uire "<Os to !rove their ca!acities .irect the Board of .irectors or -anagement of <overnment O>ned or Controlled Cor!orations to undergo a mandatory seminar on good governance

$6# $64

$64

###

$6/

##9

$$6

##4

$$0

##E

$$, $$#

#9

:egislative -easures #9$ #90 Passage of a la> on "<O Accreditation for <overnment Contracts Passage of a la> mandating COA to audit "<Os

$$#
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#9,

#9# #99 #94

handling government funds Passage of a la> mandating "<Os= that are reci!ients of government funds= to com!ly >ith R A /$C# (<overnment Procurement Reform Act) and its Im!lementing Rules and Regulations (IRR) Reiterating the need to !ass %reedom of Information bill Reiterating the need to !ass 'Amending the <overnment Procurement Reform Act) Reiterating the need to !ass 'An Act Amending R A ,6$/= Other>ise 3no>n as the AntiD<raft F Corru!t Practices Act)

$$4

$$E $$E $$C

$$C $$/

#4

Statement of Su!!ort #4$ Su!!orting the endeavour of the <overnance Commission for <overnment O>ned or Controlled Cor!orations (<C<) to streamline <overnment O>ned or Controlled Cor!orations (<OCCs) by ensuring that only <OCCs= relevant to national develo!ment= are allo>ed to eGist Su!!orting all !ertinent recommendations of the COA found in its S!ecial Audits Office Re!ort "o 06$0D6, Su!!orting legislative measures of H"CAC

$$/

#40

#4,

$0$ $0$ $00

3 CONCLU$ING REMAR4S

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COMMITTEE REPORT ' INTRO$UCTION ' ' Preli;inaries

Be are all dee!ly concerned about the s!read of corru!tion= >hich is a virus ca!able of cri!!ling governments= and discrediting !ublic institutions= thus undermining society and its develo!ment= affecting in !articular the !oor GGG Be are convinced that eGam!les should be set? by governments in ensuring the integrity of their officials+ by !olitical !arties in !romoting trans!arency in their financing+ and by the !rivate sector in a!!lying high standards of accountability Be are convinced that safeguarding integrity is not only a matter of enacting correct la>s and establishing an inde!endent= effective and efficient 8udiciary= but may also re1uire in some cases changes in attitude and in longDstanding !ractices Be are a>are that corru!tion cannot !ros!er in the full light of o!enness ;rans!arency and im!artial forms of !ublic control as >ell as coo!eration by the !rivate sector are of the utmost im!ortance Inde!endent and investigative media have a vital role to !lay

%inal .eclaration= <lobal %orum on Corru!tion and Safeguarding Integrity II ($E .ecember 066$)

Corru!tion in the bureaucracy has al>ays been the !roverbial bane of national develo!ment Indis!utably= corru!tion is the greatest im!ediment to good governance= trans!arency and accountability in any government It not only destabili(es the rule of la> and >ea3ens democracy= but such !henomenon violates human rights as >ell=

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!articularly= the right of e1ual access to !ublic service

By fostering economic

ine1uality= corru!tion further marginali(es the !oor= demorali(es society= and cri!!les our strength as a nation ;he effects of corru!tion are so eGtensive and devastating that it is not difficult to classify corru!tion as a 'crime against humanity )

;rans!arency InternationalIs 06$, Corru!tion Perce!tions IndeG0 still !laces the

Phili!!ines in the 'red (one=) des!ite a slight im!rovement in its ran3ings
,

;his

indicates that although the governmentIs antiDcorru!tion drive is being mobili(ed= there is still so much to do to >eed out corru!tion significantly= if not entirely It is interesting to note that the Senate investigation into the Priority .evelo!ment Assistance %und (P.A%) scam coincides >ith the governmentIs concrete efforts to com!ly >ith the Hnited "ations Convention Against Corru!tion (H"CAC) ;he H"CAC lays do>n the ultimate goals of any antiDcorru!tion drive?
Article $ Statement of Pur!ose ;he !ur!oses of this Convention are? a) ;o !romote and strengthen measures to !revent and combat corru!tion more efficiently and effectively+ b) ;o !romote= facilitate and su!!ort international coo!eration and technical assistance in the !revention of and fight against corru!tion= including asset recovery+ c) ;o !romote integrity= accountability and !ro!er management of !ublic affairs and !ublic !ro!erty

Hniversal .eclaration of @uman Rights= < A Res 0$E A (III)= .ecember $6= $/#C Jhereinafter H.@RK= Par 0= art 0$ ';rans!arency International is a global civil society organi(ation leading the fight against corru!tion ) ;rans!arency International=

available at htt!?AA>>> trans!arency org (last accessed -arch 0E= 06$#)

, ';he indeG= >hich measures the !erceived levels of !ublic sector corru!tion in $EE countries and territories= sho>ed the Phili!!ines notched u! to /#th !lace from $69th last yearL) ;rans!arency International= available at htt!?AA>>> trans!arencyD !h orgA06$,A$0Acorru!tionDindeGD!hDremainsDinDredD(oneA (last accessed -arch 0E= 06$#)

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;he Office of the President (OP) and the Office of the Ombudsman (O-B)= as a result of a -emorandum of Agreement=# recently s!earheaded a series of round table discussions and s!ecial >or3ing grou!s to im!lement the countryIs 0$D!oint H"CAC

Action Agenda 9 ;his includes legislative measures such as increasing the !enalty for
graft and corru!t !ractices= !assage of a >histleblo>ers !rotection act= and criminali(ing graft and corru!t !ractices in the !rivate sector= among others Phili!!ine Senate ratified the H"CAC bac3 in C "ovember 0664 ;he

Aside from violating

our domestic la>s= the !er!etrators of the P.A% Scam have violated the H"CAC as >ell ;his Committee Re!ort relates to the eG!loitation= in endemic !ro!ortions= of the P.A% It shall focus on the modus o!erandi to divert= misa!!ro!riate= and ultimately steal billions in taG!ayersI money to the detriment of the %ili!ino !eo!le ;he method a!!lied to funnel !ublic funds for !rivate gain re1uires a com!rehensive net>or3 of government !ersonalities that is astonishingly efficient= meticulous and organi(ed It is a testimony of ho> the sacred !rinci!le 'Public Office is a Public ;rust) has been callously desecrated re!eatedly by those >ho have s>orn to u!hold the la> and serve the !eo!le '>ith utmost res!onsibility= integrity= loyalty= and efficiency )4 ;hus= the Senate= in aid of legislation= through this Committee Re!ort= ma3es an eGamination and analysis of the P.A% scam= !articularly >ith res!ect to ho> the enormous amount of more than Ph!4 Billion from the national treasury >as turned over
# ;he -OA >as entered into on $# &une 06$, It aims to '($) establish an im!lementation and revie> mechanism on the Phili!!inesI com!liance >ith its State obligations under the H"CAC+ and (0) institutionali(e the Integrity -anagement Program (I-P) as an out!ut of the harmoni(ation of the corru!tion !revention !rograms of the OP and O-B ) 'OP= O-B in3 -OA on H"CAC com!liance and I-P im!lementation ) available at htt!?AA>>> ombudsman gov !h (last accessed -arch 0E= 06$#) 9

See AnneG A
P@I: CO"S; art MI N $

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to eightyDt>o (C0) foundations= eight (C) of >hich are lin3ed to the alleged P.A% scam mastermind= &anet :imD"a!oles (&:") E ;he modus o!erandi eGecuted by &anet :imD "a!oles= >ith the indis!ensable coo!eration of certain government officials and em!loyees= >ill serve as an illustration of ho> the P.A% >as mani!ulated and misa!!ro!riated ;his Committee Re!ort is divided into four !arts ;he first !art deals >ith the

Preliminaries+ the second !art is the Antecedent %acts+ the third !art is the %indings of the Committee+ and the final !art contains the CommitteeIs Recommendations

' 1 Series o< Hearings on t=e P$AF S>a;

;he $4th Congress has conducted a total of nine (/) hearings on the follo>ing dates >ith the follo>ing guests? ' 1 ' T=e Hearings

August 160 12'/ Chair!erson -aria <race - PulidoD;an (Commission on AuditACOA) and .irector Susan <arcia (S!ecial Audits Office= COA)
;he August 0/= 06$, hearing focused on the !resentation of Commission on Audit (COA) Commissioner <race PulidoD;an regarding the S!ecial Audits Office Re!ort on Priority .evelo!ment Assistance %und (P.A%) and 7arious Infrastructure Including :ocal Pro8ects (7I:P) Se#te;?er 30 12'/

Secretary Proceso & Alcala (.e!artment of AgricultureA.A)+ Hndersecretary -ario : Relam!agos (.e!artment of Budget and -anagementA.B-)+ -r Alan O Hmali
E

;S"? S-7illadiego IIID$= August 0/= 06$,= $6?,9A- Jhereinafter B:H* RIBBO" ;RA"SCRIP; %OR AH<HS; 0/= 06$,K at 00

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(@ead= Pamboanga del "orte College Rubber *states Cor!orationAPR*C)+ Assistant Secretary Salvador S Salacu! (.A) and former head of PR*C+ .irector Susan P <arcia (S!ecial Audits Office= COA)+ .irector Rufina S :a1uindanum (COA)+ .irector Carmencita " .elantar (Budget and -anagement Bureau= .B-)+ -r @onesto Bani1ued (President= "ational Agribusiness Cor!orationA"ABCOR)+ -r Alan A &avellana (former head of "ABCOR)+ and -s Rhodora -endo(a (former 7ice President for Administration= "ABCOR)
;he Se!tember 9= 06$, hearing !resented the side of the im!lementing agencies that served as conduit for P.A%= as >ell as the !resentation of the .e!artment of Budget and -anagement (.B-) on the ste!DbyDste! !rocedure of P.A% disbursement Se#te;?er '10 12'/

Secretary :eila .e :ima (.e!artment of &usticeA.O&)+ Assistant Secretary Pabedin - A(is (.O&)+ .irector Susan P <arcia (S!ecial Audits Office= COA)+ -r Alan O Hmali (@ead= Pamboanga del "orte College Rubber *states Cor!orationAPR*C)+ Assistant Secretary Salvador S Salacu! (.A) and former head of PR*C+ -r @onesto Bani1ued (President= "ational Agribusiness Cor!orationA"ABCOR)+ -s <ondolina A Amata (President= "ational :ivelihood .evelo!ment Cor!orationA":.C)+ -r .ennis Cunanan (.irector <eneral= ;echnology Resource CenterA;RC)+ Atty :evito Baligod (counsel for Benhur :uy)+ and -r Benhur :uy (>histleblo>er)
;he Se!tember $0= 06$, hearing served as the venue for 3ey >histleblo>er= Benhur :uy= a relative and a former em!loyee of &anet :imD"a!oles= to narrate ho> the P.A% scam >as accom!lished Se#te;?er 1&0 12'/

Secretary :eila .e :ima (.e!artment of &usticeA.O&)+ and Assistant Secretary Pabedin - A(is (.O&)
;he Se!tember 0#= 06$, hearing= >hich >as summary in nature= aired .e!artment of &ustice (.O&) Secretary :eila .e :imaIs !osition to defer= sub8ect to the o!inion of the Office of the Ombudsman= the !resentation of the rest of the >histleblo>ers= as the !ublicity of the hearing may '!re8udice the safety of the
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>itnesses )C Blue Ribbon Chair!erson ;eofisto ';<) <uingona III disagreed= saying that this >as an attem!t 'to undermine and diminish the !o>er of the Senate Blue Ribbon Committee )/ Se#te;?er 150 12'/

Secretary :eila .e :ima (.e!artment of &usticeA.O&)+ Hndersecretary &ose % &ustiniano (.O&)+ Assistant Secretary Pabedin - A(is (.O&)+ -r Benhur :uy (>histleblo>er)+ -s <ertrudes :uy (>histleblo>er)+ -s -arina Sula (>histleblo>er)+ -s -erlina Su5as (>histleblo>er)+ -s -ary Arlene Balta(ar (>histleblo>er)+ and -s Simonette Briones (>histleblo>er)
;he Se!tember 04= 06$, hearing focused on the res!ective testimonies of siG (4) >histleblo>ers= >ho all have !ersonal 3no>ledge of ho> the P.A% scam >as !er!etrated No@e;?er A0 12'/

Secretary :eila .e :ima (.e!artment of &usticeA.O&)+ Hndersecretary &ose % &ustiniano (.O&)+ Assistant Secretary Pabedin - A(is (.O&)+ Atty -artin -e5es (.irector= Bitness Protection Program= .O&)+ Atty Rene Cartera 7illa (Chairman= :ocal Bater Htilities AdministrationA:BHA)+ Atty @o>ard Are(a (Public Attorneys OfficeAPAO)+ Atty -arlon * Buan (PAO)+ Atty Analisa Soriano (PAO)+ -s &anet :imD "a!oles+ -r Benhur :uy (>histleblo>er)+ -s <ertrudes :uy (>histleblo>er)+ -s -arina Sula (>histleblo>er)+ -s -erlina Su5as (>histleblo>er)+ -s -ary Arlene Balta(ar (>histleblo>er)+ and -s Simonette Briones (>histleblo>er)
;he "ovember E= 06$, hearing !rovided the alleged P.A% mastermind= &anet :imD"a!oles= the o!!ortunity to confirm or deny the accusations hurled against her by the >histleblo>ers

Rules of Procedure of the Office of the Ombudsman= Administrative Order "o 6E ($//6)= N 0= Rule 9 ;S"? ctsotto= IID$= Se!tember 0#= 06$,= /?,CA- Jhereinafter B:H* RIBBO" ;RA"SCRIP; %OR S*P;*-B*R 0#= 06$,K at $4

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,anuarB /20 12'&

Chair!erson ;eresita & @erbosa (Securities and *Gchange CommissionAS*C)+ Chair!erson -aria <race - PulidoD;an (Commission on AuditACOA)+ Chairman Cesar : 7illanueva (<overnance Commission for <OCCsA<C<)+ Chairman Augusto P I Car!io (Phili!!ine Council for "<O Certification)+ *Gecutive .irector .ennis S Santiago (<overnment Procurement Policy BoardA<PPB)+ (OIC)D*Gecutive .irector <iovani ; Platero (Coo!erative .evelo!ment AuthorityAC.A)+ and Advocacy Program Officer &et Paca!ac (Caucus of .evelo!ment "<O "et>or3sACO.*D"<O)
;he &anuary ,6= 06$# hearing gave relevant government agencies and !rivate organi(ations the o!!ortunity to share !olicy recommendations and remedial measures to !revent another 'P.A% scam) from occurring and to ensure the 8udicious management of all forms of !ublic funds Particular em!hasis >as given on enhancing >ays to validate= accredit and certify legitimate "<Os and other nonDstoc3 and nonD !rofit organi(ations Fe?ruarB '/0 12'&

Secretary :eila .e :ima (.e!artment of &usticeA.O&)+ Assistant Secretary Pabedin - A(is (.O&)+ Atty -artin -e5es (.irector= Bitness Protection Program= .O&)+ -s Ruby ;uason (>histleblo>er)+ -r Benhur :uy (>histleblo>er)+ -s <ertrudes :uy (>histleblo>er)+ -s -arina Sula (>histleblo>er)+ -s -erlina Su5as (>histleblo>er)+ Atty .ennnis P -analo (counsel of -s Ruby ;uason)+ and Atty Benedicto 7alerio (counsel of -s Ruby ;uason)
;he %ebruary $,= 06$# hearing (oomed in on the testimony of Ruby ;uason= >ho described herself as a 'goDbet>een) in the eGecution of the P.A% scam= and confirmed that she !ersonally delivered P.A% 3ic3bac3s to legislators Mar>= 50 12'&

Secretary :eila .e :ima (.e!artment of &usticeA.O&)+ Assistant Secretary Pabedin A(is (.O&)+ Atty -artin -e5es (.irector= Bitness Protection Program= .O&)+ -r Benhur
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:uy (>histleblo>er)+ -r .ennis Cunanan (.irector <eneral= ;echnology Resource CenterA;RC)

;he -arch 4= 06$# hearing focused on the testimony of .ennis Cunanan= a to! official of an im!lementing agency= >ho claimed that legislators eGerted !ressure to ensure that their res!ective P.A%s >ould go to a !articular "onD<overnment Organi(ation ("<O) that the legislators themselves have chosen

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ANTECE$ENT FACTS 1 ' O@er@ieC

1'' PrioritB $e@elo#;ent Assistan>e Fun% *P$AF)

;he Priority .evelo!ment Assistance %und (P.A%) is essentially a discretionary fund= to finance= as the name suggests= !riority develo!ment !ro8ects= >hose disbursement is !artially controlled by la>ma3ers A eu!hemism for '!or3 barrel funds=) the P.A% has al>ays been a contentious national issue 'In $/,#= >hen the $/,9 Constitution >as being formulated= there >as a !ro!osal to !rohibit '!or3 barrel) funds altogether ;he s!onsor of the !ro!osal traced the name '!or3 barrel) to a degrading ritual in slavery days At a fiGed day and hour= a barrel stuffed >ith !or3 >ould be rolled out and a multitude of blac3 slaves >ould cast their famished bodies into the !orcine feast to assuage their hunger ;he $/,# !ro!osal >as defeated and the !or3 barrel institution lived on )$6 ;he follo>ing brief history of P.A% is culled from the S!ecial Audits Office Re!ort of the Commission on Audit (COA)?
;he !ractice of !roviding a certain amount for the !ro8ects of the legislators started in $/C/= u!on the creation of the -indanao .evelo!ment %und and 7isayas .evelo!ment %und= >ith lum! sum a!!ro!riations of Ph!#C6 6 -illion and Ph!0#6 6 -illion= res!ectively ;hese funds >ere intended to su!!ort develo!ment !ro8ects identified by Re!resentatives from 7isayas and -indanao areas Subse1uently= in $//6 the Country>ide .evelo!ment %und (C.%) >as created >ith an initial funding of Ph!0 , Billion to cover the im!lementation of !ro8ects identified by the Senators and Re!resentatives including those from the :u(on area In 0666= the C.% >as renamed as P.A% $$
$6

&oa1uin < Bernas= S & = ;he %uture of the Barrels of Por3= available at htt!?AAo!inion in1uirer netA9/4#/AtheDfutureDofDtheDbarrelsD ofD!or3 (last accessed -arch 0E= 06$#)
$$

CO--ISSIO" O" AH.I; SP*CIA: AH.I;S O%%IC* R*POR; "O 06$0D6, Jhereinafter COA R*POR;K at 0

Page 16 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33
$0

;he same Re!ort also itemi(ed the government !ro8ects= that are 1ualified for P.A% funding from 066ED066/?
%or CQ 066E to 066/= the !ro8ects eligible for funding under P.A% are described as soft !ro8ects under the category of education health= livelihood= com!rehensive integrated delivery of social services= financial assistance to address s!ecific !roD!oor !rograms of the government= historical (sic)= arts and culture= !eace and order+ and small infrastructure !ro8ects such as irrigation= rural electrification= >ater su!!ly= housing and forest management $0

On "ovember $/= 06$,= voting $#D6= the Su!reme Court issued a landmar3 decision= Belgica vs *Gecutive Secretary$, declaring the P.A% unconstitutional ;he Su!reme Court ruled that there has been a violation of the doctrine of se!aration of !o>ers= the !rinci!le of nonDdelegability of legislative !o>ers= and the system of chec3s and balances S!ecifically= the Su!reme Court declared as unconstitutional?
a) ;he entire 06$, P.A% Article+

b) All legal !rovisions of !ast and !resent Congressional Por3 Barrel :a>s= such as the !revious P.A% and C.%$# Articles and the various Congressional Insertions= >hich authori(eAd legislators R >hether individually or collectively organi(ed into committees R to intervene= assume or !artici!ate in any of the various !ostDenactment stage of the budget eGecution= such as but not limited to the areas of !ro8ect identification= modification and revision of !ro8ect identification= fund release andAor fund realignment= unrelated to the !o>er of congressional oversight+ c) All legal !rovisions of !ast and !resent Congressional Por3 Barrel :a>s= such as the !revious P.A% and C.% Articles and the various Congressional Insertions= >hich conferred !ersonal= lum!Dsum allocations to legislators from >hich they are able to fund s!ecific !ro8ects >hich they themselves determine+

Id
Belgica v *Gecutive Secretary= < R "os 06C944+ 06C#/, and 06/09$ (06$,) Country>ide .evelo!ment %und

$,

$#

Page 17 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21

d) All informal !ractices of similar im!ort and effect= >hich the Court similarly deems to be acts of grave abuse of discretion amounting to lac3 or eGcess of 8urisdiction $9

1'1

S#e>ial Au%its O<<i>e Re#ort on PrioritB $e@elo#;ent Assistan>e Fun% *P$AF) an% )arious In<rastru>ture

In>lu%ing Lo>al ProDe>ts *)ILP) On $4 August 06$,= the COA !ublished its S!ecial Audits Office Re!ort "o 06$,D 6,= a governmentD>ide !erformance audit on the P.A% and 7arious Infrastructure including :ocal Pro8ects (7I:P) ';he audit >as conducted from &une $9= 06$6 to Se!tember $,= 06$0 !ursuant to COA Office Order "o 06$6D,6/ dated -ay $,= 06$6 and subse1uent issuances )$4 ;he audit covered the calendar years 066E to 066/ ;he said re!ort details several glaring irregularities in the release of P.A% by im!lementing agencies to nonDgovernment organi(ations ("<Os)= one of >hich is 'the absence of an a!!ro!riation la> or ordinance earmar3ing certain amounts to be contracted out to "<Os=)$E among others .uring her !resentation before the Blue Ribbon Committee on 0/ August 06$,= COA Commissioner <race PulidoD;an stated that the C foundations lin3ed to &anetD:im "a!oles received a total of almost Ph! 0 Billion= Ph!$ /, Billion of >hich came from the P.A% allocations of senators
$C

'As noted during the Audit= a number of "<Os are either

$9

Belgica v *Gecutive Secretary= su!ra note $, COA R*POR;= su!ra note $$= at cover !age

$4

$E

Id at $9
B:H* RIBBO" ;RA"SCRIP; %OR AH<HS; 0/= 06$,= su!ra note E= at 09

$C

Page 18 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

nonDeGistent or cannot be located or lac3 legal !ersonality to transact business Borse= a number of them >ere found to have submitted 1uestionable documents )$/ ;his Audit Re!ort= together >ith the Senate Resolutions filed= became the !rimary bases for the Blue Ribbon Committee to initiate an investigation in aid of legislation into the P.A% scam 1'/ O?De>ti@es o< t=e Co;;ittee Re#ort

In his O!ening Statement= the Chair!erson of the Blue Ribbon Committee= Senator ;eofisto ';<) <uingona III= enumerated the 1uestions that he felt the !ublic >anted ans>ered?
THE CHAIRMAN" 2augnay ng mga !angyayari= nadinig natin ang maraming tanong ng mga 3ababayan natin Hna= ano ba talaga ang nangyariS Bhat really ha!!ened hereS Pangala>a= ba3it nangyari at sino ang da!at managotS Bhy did it ha!!en and >ho should be held accountableS Pangatlo= ano ang da!at ga>in !ara hindi na ulit mangyari itoS Bhat must be done so that >hat ha!!ened >ill not ha!!en again in the future -ahalaga ang !unto ng taong bayan 06

In consonance >ith the aforementioned goals= this Re!ort has been !re!ared to determine the follo>ing? a) @o> the P.A% scam >as !er!etrated+ b) Bhat la>sArules and regulationsAgovernment issuances >ere violated+ c) Bho >ill be held accountable for such violations+ and d) Bhat measuresAreforms are needed to !revent !ublic funds from being misa!!ro!riated in the future

$/

COA R*POR;= su!ra note $$= at 00 B:H* RIBBO" ;RA"SCRIP; %OR AH<HS; 0/= 06$,= su!ra note E= at CD/

06

Page 19 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16

1'&

S>o#e o< t=e Co;;ittee Re#ort

;his Committee Re!ort >ill deal >ith the P.A% Scam by using the &anet :imD "a!oles modus o!erandi as a case in !oint Bhile the Blue Ribbon Committee is fully a>are that the eG!loitation of P.A%= in all its incarnations= may have s!anned across several administrations= this Re!ort= in the interest of eG!ediency= >ill focus on CQ 066ED066/ only ;his is !rimarily because the S!ecial Audits Re!ort of the Commission on Audit on P.A% and 7arious Infrastructure

including :ocal Pro8ects (7I:P) released by the COA >as limited to the said !eriod and
the !ertinent resolutions referred to the Blue Ribbon Committee >ere also s!ar3ed by this Re!ort As a side note= the terms 'nonDgovernment organi(ationsA"<Os) and

'foundations) are used interchangeably ;he same could be said >ith the terms '3ic3bac3As) and 'commissionAs )

1 1 P$AF $is?urse;ent Pro>e%ure

;he !rocedure for the disbursement of P.A%= by and large= could be illustrated by the follo>ing flo> chart?

Legislator

Department of Budget & anagement !DB "

#mplementing $gen%ies !#$s"

Benefi%iaries

17

Page 20 of 122

1 2 3 4

Although there are other ste!s in bet>een= the diagram sho>s the fundamental !hases only= for the sa3e of sim!licity ;his chart is verified and further substantiated by Hndersecretary -ario : Relam!agos of the .B-= during his !resentation last 9 Se!tember 06$, 0$ %oundations= in light of the constitutional mandate that 'the state shall encourage nonDgovernmental= communityDbased= or sectoral organi(ations that !romote the >elfare of the nation=)00 >ere allo>ed to !artici!ate in the im!lementation of governmentDfunded !ro8ects ;his is >hat !aved the >ay for &anet :imD"a!olesD

5 6 7 8 9 10

controlled foundations to ta3e !art in the P.A% @ence= a more detailed P.A% flo> chart >ould a!!ear this >ay?

Legislator

DB

#$s

&'(s

Benefi%iaries

11 12 13 14 15 16

;he irregularities occur in bet>een these ste!s And as the follo>ing discussion >ould sho>= the ultimate ste! R recei!t of benefits by the !eo!le R the raison dTetre of P.A% is more often than not= omitted entirely from the !rocess

0$

;S"? CB<ealan 7IID$ Se!tember 9= 06$,= $6?$EA- Jhereinafter B:H* RIBBO" ;RA"SCRIP; %OR S*P;*-B*R 9= 06$,K at 46 on>ards P@I: CO"S; art II N 0,

00

Page 21 of 122

1 / P$AF S>a;

)reation of &'(s *+ &apoles and %ompan+

&egotiation *et,een &apoles group and Legislators regarding -i%-*a%-s

#mplementation of s%.eme

/plitting of t.e Loot

2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17

;he modus o!erandi carried out by &anet :imD"a!oles and her cons!irators serves as a relevant illustrative eGam!le of ho> the P.A% >as !ilfered from its rightful reci!ients in order to feed the insatiable greed of a fe> ;his discussion on the P.A% Scam is derived from the testimonies of the >histleblo>ers during their a!!earance in the Blue Ribbon hearings= their res!ective affidavits submitted to the "ational Bureau of Investigation ("BI)= as >ell as other documents submitted by several government agencies to the Committee 1/' Creation

%oundations are created by !eo!le under the control of &anet :imD"a!oles ;hese entities are then 1ualified to !artici!ate in governmentDfunded !ro8ects= such as those financed by the P.A% ;hese foundations a!!ear legitimate= as they dutifully com!lied >ith

documentary re1uirements of the Securities and *Gchange Commission (S*C) @o>ever= several glaring badges of fraud= >hich >ill be brought to light in the succeeding !aragra!hs= negate the authenticity of these entities

Page 22 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36
0,

According to the >histleblo>ers= u!on the instructions of &anet :imD"a!oles= they created and registered several foundations >ith the S*C >hose incor!orators and officers are under the control andAor em!loy of &anet :imD"a!oles ;hese foundations are the follo>ing?
$) 0) ,) #) 9) 4) E) C) /) $6) $$) $0) $,) $#) $9) $4) $E) $C) $/) 06) 0$) 00) Abundant @arvest for Peo!leTs %oundation= Inc Agricultura Para sa -agbubu3id %oundation= Inc (AP-%I) Agri F *conomic Program for %armers %oundation= Inc (A*P%%I) Bu3irin ;angla> %oundation= Inc Country>ide Agri F Rural *conomic .evelo!ment %oundation= Inc (CAR*.) .alang!an Sang Amon Htod 2ag 2asiman>a %oundation= Inc <inintuang Alay sa -agsasa3a %oundation <intong Pang3abuhayan %oundation= Inc 2arangyaan Para sa -agbubu3id %oundation= Inc 2asaganahan Para sa -agsasa3a %oundation= Inc 2au!danan Para sa -angunguma %oundation= Inc -asaganang Ani Para sa -agsasa3a %oundation= Inc (-A-%I) -asaganang Buhay %oundation= Inc -icro Agri Business Citi(ens Initiative %oundation= Inc (-ABCI%I) <intong Pang3abuhayan %oundation= Inc Peo!leTs Organi(ation for Progress and .evelo!ment %oundation (POP.%I) Phili!!ine Agri F Social *conomic .evelo!ment %oundation= Inc (PAS*.) Phili!!ine Social .evelo!ment %oundation= Inc (PS.%I) Saganang Buhay sa Atin %oundation A Smile %oundation= Inc Social .evelo!ment Program for %armers %oundation= Inc (S.P%%I) ;angla> Para sa -agsasa3a %oundation= Inc 0,

*ight (C) foundations from the aforementioned list are im!licated in the disbursement of the P.A%= as testified to by COA Commissioner <race PulidoD;an on the 0/ August 06$, hearing of the Blue Ribbon Committee= to >it?
$) Agri and *conomic Program for %armers %oundation Inc (A*P%%I) 0) Agricultura Para sa -agbubu3id %oundation Inc (AP-%I) ,) Country>ide Agri and Rural *conomic .evelo!ment (CAR*.) %oundation Inc
&oint Statement of Benhur 2 :uy= -erlina P Su5as= <ertrudes 2 :uy= and Anabelle :uyDReario= August 9= 06$,= Par ,

Page 23 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39

#) -asaganang Ani Para sa -agsasa3a %oundation= Inc (-A-%I) 9) Peo!leTs Organi(ation for Progress and .evelo!ment %oundation Inc (POP.%I) 4) Phili!!ine Agri and Social *conomic .evelo!ment %oundation Inc (PAS*.) E) Phili!!ine Social .evelo!ment %oundation Inc (PS.%I) C) Social .evelo!ment Program for %armers %oundation= Inc (S.P%%I)

;he >histleblo>ers further enumerated the !ersonalities running these foundations on behalf of &anet :imD"a!oles?
;he !residents and incor!orators of the aboveDlisted foundations and &:" o>nedDorDcontrolled cor!orations are &:"Is relatives= &:" Cor!oration em!loyees and househel!ers (i e driver= body guard= nanny= gardener= maids= etc ) ;hey are the follo>ing? $) Reynaldo '&o8o) :im 0) Ronaldo %rancisco :im ,) *velyn .itchon .e :eon #) "ova 2aye .ulay 9) -arina C Sula 4) Simonette Briones E) &aime <arcia "a!oles C) &ames Christo!her :im "a!oles /) &eane Catherine :im "a!oles $6) &ane Catherine :im "a!oles $$) &ohn Christian :im "a!oles $0) Rosita 2a>son Co $,) &ohn Raymund de Asis $#) %elimon Agustin $9) Sim!licio <umafeliG $4) 7anessa *man $E) :ilian *s!anol $C) &esus Castillo $/) *ulogio Rodrigue( 06) :orna Ramire( 0$) <enevieve Hy 00) Ronald &ohn :im 0,) &ocelyn Piorato0#

0#

Id Par #

Page 24 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27
09

In some cases= searching for nominal or 'dummy) incor!orators andAor trustees to constitute these foundations necessitated an enter!rising mind?
-ost of the names of the incor!orators and Board of ;rustees in these "<Os came from tele!hone directories= are dead= or >ere su!!lied by the !residents of the "<Os >ithout the consent of the !erson listed as incor!orator .etails of each com!any are accurately reflected in the record on file >ith the Securities and *Gchange Commission (S*C) )09

(*m!hasis su!!lied)

%rom the foregoing= a !attern is established >here those em!loyed or under the control of &anet :imD"a!oles served as officers andAor trustees of these foundations Another !atent illustration of fraud >as revealed by the Chairman .uring his O!ening Statement= he sho>ed !ictures of the res!ective !laces of business of S.P%%I= -A-%I and POP.%I= all of >hich could not be considered as an office by a reasonable !erson In con8unction >ith this= the Chairman further uncovered another dece!tion in the incor!oration !a!ers of &anet :imD"a!olesDlin3ed "<Os? GGG
CHAIRMAN" "o>= >e >ere able to loo3 into the cor!orate !a!ers of these "<Os and found that -r Benhur :uy >as involved in all threeL-r Benhur :uy >as involved in all three And a certain Collin :iyoc served as >itness in t>o documents And all three documents >ere notari(ed by Atty &oel <ordola >ho a!!ears to be notary !ublic in Oue(on City "e>s re!orts sho>ed that Atty <ordola is in !oor health and unable to s!ea3 for himself @is >ife told re!orters that Atty <ordola never notari(ed these documents 04 (*m!hasis su!!lied) GGG
S>orn Statement of -arina Sula= August 0/= 06$,= Par 4
B:H* RIBBO" ;RA"SCRIP; %OR S*P;*-B*R 9= 06$,= su!ra note 0$= at $6

04

Page 25 of 122

1 2 3 4 5 6

;he Chairman carried on >ith inconsistencies in certain signatures found in the aforementioned cor!orate !a!ers?
CHAIRMAN" H!on com!aring the three documents= >e also found inconsistencies= !articularly in the signatures of the !arties? -A-%I= POP.%I and S.P%%ILAyan= tignan ninyo= tatlong !irma ni Benhur :uy sa tatlong organi(ations Pareho baS0E

7 8 9 10 11 12 13 14 15

;hese signature sam!les are found in the Articles of Incor!oration of -A-%I= POP.%I and S.P%%I ;he cons!icuous dis!arity in the stro3es of the signatures suggest falsification Another fact >orthy of note is the use by many entities of the same ';aG Identification "umber) (;I") and 'Authority to Print) (A;P) ;he Bureau of Internal Revenue (BIR) does not allo> more than one entity to use the same ;I" or A;P Commissioner <race PulidoD;an concluded that the scheme is 'all in the family?) COA

0E

Id

Page 26 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32

MS PULI$O-TAN 2agaya !o doon sa naunang foundation= ang mga !roye3to !o ay training= farm initiative !roduction !ac3ages na nag3a3ahalaga ng #0 R hindi !esos !o R ito= #0= C/, !er !ac3age !o ito= at sa3a livelihood 3its Qou >ill notice the same su!!liers? .itchon ;rading for trainings+ --RC ;rading for the farm 3its+ and SimD<um ;rading for the livelihood 3its "agDconfirm !o ang .itchon ng 3anyang transa3siyon for meals= venue and other training re1uirements in ;ayug= Pangasinan Iyong --RC hindi !o nagDconfirm ng 3anilang transa3siyon <umagamit din !o ito ng ;I" being used by another foundation= -A-%I It had no business !ermit And even if it >as selling su!!osedly farm im!orts including fertili(ers= it >as not a licensed fertili(er handler It >as also using an A;P being used by -A-%I and SimD<um ;rading So= ang a3in !ong ano dito noong una 3o !ong na3ita= 'Ay= all in the family )0C

(*m!hasis su!!lied)

;he dubious nature and !ur!ose of these organi(ations is further highlighted by the follo>ing strategy utili(ed by the cohorts of &anet :imD"a!oles= >henever a government ins!ection is conducted at the res!ective registered !laces of business of these foundations?
;hese foundations do not really conduct business in their registered !lace of business Bhen the foundation a!!lied for accreditation and the concerned government agency conducts ins!ection= >e sim!ly furnish the registered foundation >ith a com!uter= office tables and chairs= and some documents After the ins!ection= that office is again abandoned and the o!eration of the foundation is resumed or carriedDon in the office of &:" Cor!oration at the 09th floor of .iscovery Center Suites= Ortigas Center= Pasig City 0/

;o sho> a semblance of legitimacy as to their o!erations= &anet :imD"a!olesI accom!lices >ould sim!ly simulate an office for the foundation= in so doing deceiving the government and ma3ing a moc3ery of >hat a bona fide foundation is su!!osed to be

0C

B:H* RIBBO" ;RA"SCRIP; %OR AH<HS; 0/= 06$,= su!ra note E= at ,6D,$

0/

&oint Statement of Benhur 2 :uy= -erlina P Su5as= <ertrudes 2 :uy= and Anabelle :uyDReario= August 9= 06$,= Par 4

Page 27 of 122

1 2 3 4

;he nature of business of these P.A%Drelated foundations= furthermore= a!!ears legitimate on !a!er ;he !rimary !ur!ose of each= as described in their res!ective Articles of Incor!oration= is consistent >ith the ty!ical social develo!ment thrust of a foundation By >ay of eGam!le are the follo>ing? FOUN$ATION Agri and *conomic Program for %armers %oundation Inc (A*P%%I)= PRIMAR( PURPOSE

;o encourage members in the effective utili(ation of local resources in develo!ment activities F thereby im!rove the living condition in the community

Country>ide Agri F Rural *conomic ;o !romote socioDeconomic develo!ment in the rural areas through im!lementation .evelo!ment (CAR*.) %oundation= Inc

of livelihood F em!loyment generation

-asaganang Ani Para %oundation (-A-%I) sa -agsasa3a ;o

develo! F harness the !eo!leIs !artici!ation in every economic activity to>ards the develo!ment of the community through selfDhel! and selfD reliance

5 6 7 8 9 10 11 12

%or all intents and !ur!oses= they a!!ear as develo!mentDoriented organi(ations H!on closer ins!ection though= none of them adhered to their corres!onding !rimary !ur!oses ;his >as confirmed by no less than Benhur 2 :uy and -erlina P Su5as= t>o of the >histleblo>ers >ho served as em!loyees of &anet :imD"a!oles for a long time :uy >or3ed under &anet :imD"a!oles from 0660 to 06$0 ($6 years)= >hile Su5as >as em!loyed >ith &anet :imD"a!oles from $//E to 06$0 ($9 years) ,6 ;he 'institutional 3no>ledge) ac1uired by both from all those years of service is indis!utable Hltimately=

,6 Pinagsamang Sinum!aang Salaysay of Benhur 2 :uy= -erlina P Su5as= <etrudes 2 :uy= "ova 2ay BatalD-acalintal= *lena S Abundo= F Avelina C :ingo= Se!tember $$= 06$,= Par $

Page 28 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26

:uy and Su5as testified that these foundations >ere established to serve merely as channels to reroute funds?
<inamit ni <ng "a!oles ang mga foundations na ito bilang daluyan o conduits ng !ondo na galing sa <obyerno 3agaya ng P.A% ng mga la>ma3ers= -A:A-PAQA %H".= %*R;I:IP*R %H".= at iba !ang mga !ondo galing sa mga ahensiya ng <obyerno gaya ng .A= .AR= "ABCOR= ;RC= ":.C at PR*C ,$ (*m!hasis su!!lied)

Once these foundations are already 'ri!e) to transact >ith the government= &anet :imD"a!oles begins to solicit P.A% from certain legislators= by engaging in negotiations >ith them= regarding their '3ic3bac3s ) 1/1 Negotiation

In order to obtain funding= &anet :imD"a!oles >ould a!!roach certain legislators to entice them to grant a !ortion of their res!ective P.A%s to her foundations ;he enticement comes in the form of '3ic3bac3s) for the legislators= >hich >ould be obtained from the P.A% itself In the interest of clarity= 3ic3bac3 is defined as 'an amount of money that is given to someone in return for !roviding hel! in a secret and dishonest business deal ),0 In some cases= the legislators themselves >ould come u! to &anet :imD"a!oles= to offer their o>n P.A%= as the follo>ing eGchange >ould sho>?
SEN ESCU$ERO" 2ayo ang nagDvolunteer= hindi sila luma!it at nagD a!!lyS MR LU(" 2asi= sir= noIng !umaso3 !o a3o 3ay -s "a!oles= may mga ilang ilang la>ma3ers na 3asi !umu!unta sa o!isina So= ganoon na !o Uyong 3ala3aran ng office
,$

Id at Par , $
Available at htt!?AA>>> merriamD>ebster comAdictionaryA3ic3bac3 (last accessed -arch 0E= 06$#)

,0

Page 29 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36

SEN ESCU$ERO" Pumu!unta sa o!isina !ara 3unin Uyong !arte nilaS MR LU(" Pumu!unta !o sa 3anila na inaaalo3 nila Uyong 3anilang P.A% SEN ESCU$ERO" "ag!u!unta sa o!isina !ara alu3in Uyong P.A% nila sa inyo MR LU(" Qes= !o= 3ung gusto da> !o 3ami ang magDim!lement= ganoon SEN ESCU$ERO" So= >al3Din sila MR LU(" <anoon !o SEN ESCU$ERO" Bal3Din sila= >al3Din na mga customer 3umbaga MR LU(" O!o= !umu!unta dun 2asi= sir= nong nandoon a3o= refer= may ganoon= refer= refer= refer SEN ESCU$ERO" So= >ord of mouth= i3a nga MR LU(" Qes= sir ,, (*m!hasis su!!lied)

;his business transaction is described by the >histleblo>ers in the follo>ing manner?

2a3ausa!in ni <ng "a!oles ang la>ma3er na ma3a3a!agDbigay ng !ondo= at !ag3a3asunduan nila ang 3omisyon o 3ic3bac3 na da!at matangga! ng 3ausa! niya Alam namin ito dahil sinasama niya 3ami noon sa mga ilang meetings niya sa mga la>ma3ers= at ito rin ang 3inaga>ian na sa mga sumusunod niyang mga transa3syon At na3o3om!irma namin ito tu>ing nagDuutos si <ng "a!oles sa amin na maghanda o mag!adala ng !era !ara sa mga na3ausa! niya Ang 3asama namin na laging naghahanda ng !era ay sina Ronald &ohn :im at &ohn Raymund 'Bong) .e Asis ,# (*m!hasis su!!lied)

,,

;S"? -hule! M7D$= Se!tember $0= 06$,= $?,#P- Jhereinafter B:H* RIBBO" ;RA"SCRIP; %OR S*P;*-B*R $0= 06$,K at $0#D$09

,# Pinagsamang Sinum!aang Salaysay of Benhur 2 :uy= -erlina P Su5as= <etrudes 2 :uy= "ova 2ay BatalD-acalintal= *lena S Abundo= F Avelina C :ingo= Se!tember $$= 06$,= Par # $

Page 30 of 122

1 2

According to -erlina P Su5as= the P.A%= that is the sub8ect of negotiation= is usually allocated as follo>s?,9 RECIPIENT :egislator Chief of Staff of :egislator Contact in the Im!lementing Agency (IA) &anet :imD"a!oles E SHARE FROM P$AF 96V 9V $6V ,9V ;otal W $66V

3 4 5 6 7 8 9 10 11 12 13 14 15 16

%rom this sharing arrangement= the largest chun3 of the 3ic3bac3 goes to the legislator= >ith &anet :imD"a!oles coming in second It could also be inferred that the rightful beneficiaries of the P.A% received 6V share In her affidavit= Su5as further claimed that each of the follo>ing senators= >ho !ur!ortedly transacted >ith &anet :imD"a!oles= received 96V 3ic3bac3 from the P.A%? Senators &inggoy *strada= &uan Ponce *nrile and Ramon Revilla= &r
,4

Once the agreement on the 's!litting of the loot) has been finali(ed= the neGt course of action is to im!lement the !lan 1// I;#le;entation:$i@ersion o< Fun%s 1//' A%@an>e PaB;ent o< Fi>F?a>Fs

As !art of the P.A% !rocess= the !ro8ect documents are sent to .B- .B- >ill no> evaluate these !ro8ects ;he legislator >ill >rite a letter to .B- re1uesting for the release of their P.A% After evaluation= .B- >ill issue a S!ecial Allotment Release

,9

2aragdagang Sinum!aang Salaysay ni -erlina Su5as Q Pablo= Se!tember 06$,= Par 9$ Id Pars 9,D9#

,4

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Order (SARO)

A SARO is a directive 'authori(ing fund releases to government

de!artments and agencies ),E -r :uy eG!lained the !rocess in detail?

Alinsunod sa na!ag3asunduan ni <ng "a!oles at ang 3aniyang 3ausa! na la>ma3er= magbibigay siya ng advance !ayment ng 3ic3bac3 3a!alit ang sulat ng la>ma3er sa .e!artment of Budget and -anagement na 3ung saan ay humihiling ang mga la>ma3er ng release ng 3aniyang P.A% Pag3a naDrelease na ang S!ecial Allotment Release Order (SARO)= ang 3ausa! ni <ng "a!oles ay nag!a!adala sa o!isina namin (&:" Cor!oration) ng 3o!ya ng SARO !ara masingil nila ang balanse ng 3omisyon o 3ic3bac3 2aya !ag3atangga! ng o!isina namin ng 3o!ya ng SARO ay nag!a!ahanda na muli si <ng "a!oles ng !era !ara ma!ic3Du! ng la>ma3er (o ang 3aniyang re!resentante) ang mga !era sa o!isina namin o !ara i!adala sa 3anila sa 3ung saan man -insan ay i!ina!adala rin ang 3ic3bac3 nila sa !amamagitan ng ban3 transfer= at minsan sa !amamagitan ng chec3e ,C

;here >ere instances= ho>ever= that even if the legislator had not yet >ritten to the .B-= said legislator >ill re1uest for an 'advance) !ayment as >ell?
"gunit= may mga !ag3a3ataon rin na 3ahit >ala !ang sulat ang legislator sa .B- ay humihingi na ng 3aunting 'advance) ang mga ilang legislators 3a!alit ng susunod na P.A% allocation nila+ at meron ding !ag3a3ataon na 'late) magbayad si <ng "a!oles ng mga 3omisyon nila ,/

;he advance 3ic3bac3 ensured the P.A% scamD!artici!ants >ill move on to the neGt stage

,E

Official <a(ette= .B- to !hase out SAROs= AB-s in 06$, budget= available at htt!?AA>>> gov !hA06$0A6$A04AdbmDtoD!haseDoutD sarosDabmsDinD06$,Dbudget (last accessed -arch 0E= 06$#)
,C Pinagsamang Sinum!aang Salaysay of Benhur 2 :uy= -erlina P Su5as= <etrudes 2 :uy= "ova 2ay BatalD-acalintal= *lena S Abundo= F Avelina C :ingo= Se!tember $$= 06$,= Par # 0= # , ,/

Id = Par # , $

Page 32 of 122

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#6

1//1

Pre#aration o< t=e En%orse;ent Letters

Once the SARO is released= the Im!lementing Agency is no> the one tas3ed to eGecute the !ro8ect It is at this stage >herein the legislator issues another letter to facilitate the diversion of funds ;his letter R >hich is also 3no>n as an 'endorsement letter) D contains the amount allocated= the SARO number= the date= the !lace >here it >ill be im!lemented= and most im!ortantly= the favored "<O that >ill im!lement the !ro8ect
#6

It should be em!hasi(ed that these endorsement letters are vital to the >hole P.A% scheme= because it also serves as basis for the !ayment of 3ic3bac3s?
2a!alit ng bayad ng balanse ng 3omisyon o 3ic3bac3 ay ang !angala>ang sulat ng la>ma3er sa Im!lementing Agency (IA) na naglalaman ng !angalan ng "<O na !inili ni <ng "a!oles na maging reci!ient at im!lementer (sic) ng !ro8ect na !inondohan ng P.A% ng la>ma3er na nasabi 2aya ang la>ma3er ay nag!a!adala ng sulat sa IA na dineD designate niya ang "<O na una nang !inili ni <ng "a!oles #$ (*m!hasis

su!!lied)

-s Su5as gave a detailed eG!lanation of ho> these endorsement letters are !re!ared= u!on the instruction of &anet :imD"a!oles= and >ith coordination from the res!ective offices of the legislators?
T" 2ayo rin ba ang gumaga>a ng mga endorsement letter ng mga !oliticiansS S" O!o Si Benhur 2 :uy ang gumaga>a ng draft ng endorsement letter T" Sino ang nagDuutos 3ay Benhur :uy na guma>a ng draft ng endorsement letterS

2aragdagang Sinum!aang Salaysay ni -erlina Su5as Q Pablo= Se!tember $0= 06$,= Par 00

#$ Pinagsamang Sinum!aang Salaysay of Benhur 2 :uy= -erlina P Su5as= <etrudes 2 :uy= "ova 2ay BatalD-acalintal= *lena S Abundo= F Avelina C :ingo= Se!tember $$= 06$,= Par # # at #

Page 33 of 122

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S" Si -adame &enny !o T" -ata!os maga>a ang draft ng endorsement letter= saan na ito dinadalaS S" Pina!adala namin ito thru email or faG sa mga !oliticians at ilili!at ito sa letterhead nila at ineDedit nila sa 3anilang o!isina 2a!ag !irmado na ng mga !oliticians= ito ay itata>ag nila sa o!isina ng &:" Cor!oration !ara 3unin namin o 3aya naman ay mga tauhan na ng !oliticians ang nagdadala sa o!isina ng &:" Cor!oration #0

-s Su5as further idenitifed these !oliticians= as follo>s?

T" -aaari mo bang lina>in 3ung ano ang ibig mong sabihin sa sinabi mo na '!oliticiansS) S" Sila !o ay mga senador at congressman T" -aaari mo bang sabihin 3ung sinoDsino ang mga senador at congressman na iyong tinutu3oy 3ung saan iniDemail o !ina!aDfaG ang draft ng endorsement letterS S" O!o= sa o!isina nina Senator &inggoy *strada= &uan Ponce *nrile at Ramon 'Bong) Revilla= &r Sa mga Congressman= ay hindi 3o na matandaan #,

.ennis : Cunanan= the .irector <eneral of the ;echnology Resource Center (;RC)= one of the Im!lementing Agencies involved in the disbursement of the P.A%= revealed in his Affidavit dated 06th %ebruary 06$#= that legislators !ersonally hand!ic3ed and endorsed certain "<Os of &anet :imD"a!oles= contrary to the claims of the legislators that they had no !artici!ation in the selection of "<Os
#0

##

2aragdagang Sinum!aang Salaysay ni -erlina Su5as Q Pablo= Se!tember $0= 06$,= Pars 0,D09 Id = Pars 04D0E 'Por3 Scam X &inggoy denies 3no>ing Cunanan+ BongIs cam! says eGD;RC chiefIs testimony all lies=) available at

#,

##

htt!?AA>>> intera3syon comAarticleAC$0,4A!or3DscamDD8inggoyDdeniesD3no>ingDcunananDbongsDcam!DsaysDeGDtrcDchiefsDtestimonyD allDlies= %ebruary 0$= 06$# (last accessed -arch 0E= 06$#) Senators accused of !lundering their o>n !or3 barrel allocations on %riday do>n!layed the .e!artment of &usticeTs decision to acce!t former ;echnology Resource Center (;RC) director general .ennis Cunanan as !rovisional state >itness

Page 34 of 122

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-r Cunanan claimed that no less than the legislators themselves !ersonally s!o3e >ith him over the tele!honeAcellular !hone to confirm their endorsements of certain "<Os= and to in1uire as to the !rogress of their res!ective P.A%Dfunded !ro8ects @e detailed his eG!erience on tal3ing to Senators Revilla and *strada?
I could not also forget the time >hen a re!resentative of several "<Os= -r Benhur :uy= came to our office to follo>Du! and discuss their !ending P.A% funded !ro8ects at the ;RC endorsed by Sen *strada and Sen Revilla .uring our meeting= in an obvious attem!t to !ressure us to immediately a!!rove the said !ro8ects= he too3 out his cellular !hone and called the offices of Senators Revilla and &inggoy *strada After initially s!ea3ing to some !eo!le on the other line= Benhur :uy gave me his !hone and as3ed me to tal3 to Sen Revilla= and later= Sen *strada I remember vividly ho> both Senators Revilla and *strada admonished me because they thought that ;RC >as !ur!ortedly 'delaying) the !ro8ects Both Senators Revilla and *strada insisted that the ;RC should honor their choice of the "<O= >hich they selected to im!lement the !ro8ects= since the !ro8ects >ere funded from their P.A% ;hey both as3ed me to ensure that ;RC >ould immediately act on and a!!roved their res!ective !ro8ects #9 (*m!hasis su!!lied)

-r Cunanan further eG!ounded on the !hone conversation >ith Senators Revilla and *strada during the -arch 4= 06$# hearing of the Blue Ribbon Committee?
SEN A+UINO O3ay :et me go to that !articular instance na nag3ausa! iyong mga senador

Senators &inggoy *strada and Ramon YBongY Revilla &r also denied CunananTs allegations that they had endorsed and hand!ic3ed the nonDgovernment organi(ations allegedly controlled by business>oman &anet :imD"a!oles to im!lement the !ro8ects under the ;RC that >ere ban3rolled by the la>ma3ersT Priority .evelo!ment Assistance %und (P.A%) *strada said he didnTt 3no> Cunanan and he never tal3ed to him on the !hone @e also said that he had never dealt >ith government agencies im!lementing !ro8ects funded through his P.A% Also= *strada said it >as YunethicalY for la>ma3ers to follo> u! >ith im!lementing agencies through !hone calls the !ro8ects funded through their !or3 barrel allocations (*m!hasis su!!lied)
#9

S>orn Statement of .ennis : Cunanan= %ebruary 06= 06$#+ !! $6D$$ of ,4

Page 35 of 122

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IIll call you .ecu Alam ninyo !o= si .ecu matanda ho sa a3in iyan !ero ano !o= isa ring student leader iyan noong 3a!anahunan 3o So .ecu= noong !anahong na3ausa! mo iyong mga senador= si Benhur iyong nagbigay sa iyo ng tele!ono= tama ba iyonS MR CUNANAN Qes= Qour @onor Iyong !angala>a 3ay Senator Revilla at sa3a iyong una 3ay Senator *strada SEN A+UINO Benhur= do you concur >ith thatS .id you call the senators directly or did you call their chief of staffS Sino iyong tina>agan mo noonS MR LU( Sir0 ano #o Fung %ito #o sa U##er House #o0 si Pauline La?aBen FaB Senator Estra%a an% t=en %ito #o si AttB Ri>=ar% Ca;?e FaB Senator Re@illa #o SEN A+UINO So you have their numbersS MR LU( I have their numbers= sir SEN A+UINO And IIm sure you have given this evidence to .O& alreadyS MR LU( Bhen I >as illegally detained= sir= naDconfiscate lahat iyong cell !hones 3o !o SEN A+UINO So >ala 3ang record noong ta>ag na iyonS MR LU( Bala na !o But !>ede !o natin maDsub!oena the telcos 3asi alam 3o !o iyong number 3o na dati ginagamit 3o at sa3a I have the numbers of the anoD SEN A+UINO Bas that a !re!aid !hone or !ost!aid MR LU( Post!aid SEN A+UINO O3ay So the record should be there MR LU( But I remember= sir= na Atty Richard Cambe has a Smart and <lobe R SEN A+UINO Pero hindi mo matandaan iyong number mismo= hindi na= anoS MR LU( @indi na !o Page 36 of 122

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SEN A+UINO O3ay So IIm sure Secretary .e :ima thatIs R have you sub!oenaed his !hone records already 8ust to !rove that these !hone calls did ha!!enS MS $E LIMA "BI is ta3ing care of that= Qour @onor I 3no> that they have underta3en ste!s !recisely in !re!aration for trial SEN A+UINO O3ay :et me as3 about that !articular instance because R .ecu= a number of the senators= es!ecially Senator *strada has vehemently denied that he has even met you or s!o3en to you @indi 3a da> niya na3ilala ever at hindi 3a man niya na3ausa! >hich is >hyL SEN A+UINO L>hich is >hy I >ant to 3no> if there is actually real evidence sho>ing that the conversation did ta3e !lace ;ell us about that conversation At 3ung mayroon 3a nga ba talagang !roof regarding= you 3no>= the veracity or the truth to that conversation MR CUNANAN Qour @onor= at that time= Benhur >as lobbying for the !ro8ect in their behalf dahil iyong "<O niya ang R iyong social= iyon iyong nag !oD!rocess nung P.A% nung dala>a And I >as telling him na it has to go through a degree of !rocessing !a= iyong !inaDfollo> u! niya ;a!os sabi niya ';inata>agan 3o ho iyong o!isina= iyong legislator !ara 3ausa!in 3ayo ) Sabi 3o= 'Sige ) Parang ganoon= hindi baS I >as even doubting if he can really call And he did So0 noong naFausa# niBa ;una si La?aBen0 ;ost liFelB on t=e line Fasi nung #inasa sa aFin0 ang sina?i Faaga% ni La?aBen0 G$ire>tor0 Fausa#in FaBo ni Senator H So0 %a=il %e#utB %ire>tor aFo noon at nasa o#isina aFo Noong #inasa0 siBe;#re s=o>Fe% aFo na #inasa Sina?i sa aFin0 GAno #ang #ro?le;a niBan0 ?aFit =in%i niBo #a ta#usinI Para ;ai;#le;ent na0 =ini=intaB na iBan sa groun% H Sa?i Fo GSenator0 #ino-#ro>ess lang =o na;ing Hin%i na;an =o talaga ganun Fa%ali-%ali la=at iBon H $oon Fa;i nata#os So0 Calang %u%a na =in%i siBa iBon %a=il0 Bou FnoC0 <ro; t=e ot=er line ganoon ang #inasoF Ta#os0 iBong na#a#anoo% %in natin sa #eliFula at naFiFita natin sa T) iBong FanBang #ersonalitB So0 Fa?isa%o ;o iBong ?oses Su;uno%0 <inaloC u# *<olloC-u#) 8Bong FaB Senator Re@illa So0 ang Fausa# niBa si AttB Ca;?e on t=e #=one An% t=en AttB Ca;?e sai% GMaB CaB ?a na <ast-tra>FIH Parang ganoon So0 sa?i Fo0 GInaaBos na;an So0 Ce Dust =a@e to Cait H Ta#os0 =inol% *=ol%) aFo <or a C=ile t=en sa?i0 GO0 si Senator ;aB ano lang H Ta#os0 iBon IBong #arang0 GMagtatagal #a ?a na;an iBan0 P$AF Fo na;an iBan0 aut=oriJe% na;an iBong NGO BaFa #Ce%e niBo nang i-#ro>ess niBo na iBan0 ;a%aliin niBa no H (our Honor0 iBong >ir>u;stan>e na iBon =in%i Fo lang talaga ;a%etalBe Page 37 of 122

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#4

talaga iBong eKa>t Cor%s %a=il it =a##ene% a long ti;e ago Pero I %o not get #=one >alls L I %o not get to talF e@erB %aB to senators #4 (*m!hasis su!!lied)

;his allegation of legislators going the eGtra mile to ensure that their res!ective P.A%s >ill be transferred to their chosen "<Os= is illuminating in terms of the eGtent of the !artici!ation of and the undue influence eGerted by legislators in the overDall disbursement of the P.A% 1/// Colle>tion

;he office of &anet :imD"a!oles >ill then follo> u! >ith the .B- for the release of the "otice of Cash Allocation ("CA) to the "<O "ot unli3e the SARO= the "CA is a document authori(ing the release of !ublic funds ;he "CA is then used to claim the chec3 >hich is then either encashed or de!osited into a ban3 account controlled by &anet :imD"a!oles?
Agad naman magDfollo>Du! ang o!isina namin sa .B- !ara maDrelease ang "otice of Cash Allocation ("CA)+ Pag3aDrelease ng "CA ay agad naman ang a3syon ng IA at mabilis ang !agDrelease ng che3e sa "<O na binanggit sa sulat ng la>ma3er Ang tumatangga! at nagdeDde!osito sa chec3e !ara sa "<O ay 3ung sino ang inutusan ni <ng "a!oles sa aming mga em!leyado= na 3arani>an ay si *velyn . .e :eon= &ohn Raymund .e Asis= at 3ami (Benhur at -erlina) Pag3ade!osito ng che3e sa account ng "<Os ay agad !ina!ata>agan ni <ng "a!oles ang bang3o !ara mag!aDreserve ng !ondo !ara maD >ithdra> agad ang !era !ag nagDclear ang che3e Pag3aD>ithdra> ng !era sa bang3o ay agad dinadala 3ay <ng "a!oles ang cash sa o!isina ng &:" Cor!oration sa .iscovery Center Suites= Ortigas Center= Pasig City Pag3ata!os naming maDaccount o mabilang 3ung mag3ano ang !era na dinala doon= ay sa3a nagDuutos si <ng "a!oles 3ung mag3ano ang maii>an na cash sa o!isina at 3ung mag3ano
;S"? -P-*".OPA M7I D$= -arch 4= 06$#= $$?9$ A- F Caturla ID0= -arch 4= 06$#= $0?6$ P- Jhereinafter B:H* RIBBO" ;RA"SCRIP; -ARC@ 4= 06$#K at $,6D$,,

%OR

Page 38 of 122

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ang dadalhin sa bahay niya sa $CDB= Pacific Pla(a ;o>ers= Bonifacio <lobal City= ;aguig City #E (*m!hasis su!!lied)

Since all the involved "<Os are under the direct control of &anet :imD"a!oles= she encounters no !roblem in encashing the government chec3s that >ere issued in the name of the "<Os It has been the !ractice in &anet :imD"a!olesI office that >henever an individual is assigned to be the !resident of the "<O or %oundation= said !erson is made to sign several >ithdra>al sli!s in advance?
T" Pa!aano naman maiDencash ng re!resentative ni &anet :im "a!oles gayong ang tse3e ay na3a!angalan sa !residente ng "<O o foundationS S" 2asi !o 3a!ag naatasan ang em!leyado na maging !residente ng "<O o foundation= mag!a!aga>a na si -adame &anet :im "a!oles ng madaming !reDsigned >ithdra>al sli!s @a>a3 din ni -adame &anet :im "a!oles 2aya 3a!ag available na ang !era= may access na siya !ara i!aD >ithdra> ang mga ito Bu3od dito= ay may contact !erson na rin siya sa bang3o #C (*m!hasis su!!lied)

;here are also instances >herein the >ithdra>als >ere made by the 'President of the foundation or any authori(ed re!resentative to be determined by &:"= accom!anied by some security !ersonnel of &:" )#/ ;his is eG!ounded by -s Su5as?
%or instance= I= -erlina P Su5as 3no> that one of my !reDsigned >ithdra>al sli! in the !ossession of &:" >as used on .ecember 0E= 06$0= Peo!leIs Organi(ation for Progress and .evelo!ment %oundation= Inc (POP.%I) >ithdre> ;en -illion Pesos (P$6= 666=666 66) from its account in :and Ban3 D <reenhills Branch &:" authori(ed a driver of &:" Cor!oration D *ulogio Rodrigue( D to >ithdra> the said amount 96

#E Pinagsamang Sinum!aang Salaysay of Benhur 2 :uy= -erlina P Su5as= <etrudes 2 :uy= "ova 2ay BatalD-acalintal= *lena S Abundo= F Avelina C :ingo= Se!tember $$= 06$,= Pars # 4D# / #C

2aragdagang Sinuma!aang Salaysay ni Benhur :uy y 2ila!3ila!= Se!tember $0= 06$,= Par CC &oint Statement of Benhur 2 :uy= -erlina P Su5as= <ertrudes 2 :uy= and Anabelle :uyDReario= August 9= 06$,= Par / $ Id = Par / $ $

#/

96

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;he encashed amount is then brought to the office of &anet :imD"a!oles in .iscovery Center Suites located in Ortigas Center= Pasig City &anet :imD"a!oles >ill then decide as to the amount that >ill be left at the office and the amount that >ill be brought to her home ;he househel!ers of &anet :imD"a!oles >ill then receive the money handed over by em!loyees of &:" Cor!oration to the house of &anet :imD "a!oles ;he staggering 1uantity of bills and amounts of money being delivered to the house of &anet :imD"a!oles is highlighted in the follo>ing testimonies?
2ami= <ertrudes 2 :uy= "ova 2ay BatalD-acalintal= *lena S Abundo at Avelina :ingo= bilang 3asambahay ni <ng "a!oles noon= ang tumatangga! ng !era na dinadala ng mga em!leyado ng &:" Cor!oration sa $CDB Pacific Pla(a ;o>ers 2arani>an ay maraming bags ng !era ang dinadala nila sa nasabing bahay ni <ng "a!oles= at 3ami ang nagbubuhat sa mga bags na ito mula elevator !a!aso3 sa condominium unit "oong una ay nilalagay lamang namin ang mga bags na naglalaman ng !era sa -asterIs Bedroom= ngunit nang nagrere3lamo si <ng "a!oles dahil !ati ang 3ama na niya ay may na3a!atong na mga bags= ay sinabihan 3ami na ilagay na lamang ang iba sa bathtub sa masterIs bedroom 2aya mula noon= sa bathtub na naming nilalagay ang mga dumarating na !era galing sa &:" Cor!oration 9$ (*m!hasis su!!lied)

After attaining control of the funds= &anet :imD"a!oles >ill no> 8ustify the disbursement by !re!aring a li1uidation re!ortAre!ort of disbursement D >hich is a re1uirement under the -OA

9$ Pinagsamang Sinum!aang Salaysay of Benhur 2 :uy= -erlina P Su5as= <etrudes 2 :uy= "ova 2ay BatalD-acalintal= *lena S Abundo= F Avelina C :ingo= Se!tember $$= 06$,= Pars # $$D# $0

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1//&

LiMui%ation

Once &anet :imD"a!olesI controlled "<Os receive the P.A% funds= &anet :imD "a!oles >ill then as3 her staff to !re!are the li1uidation of these funds detailed ho> they 'li1uidate) these funds?
T" Paano ninyo ginaga>a ang sinasabi mong li1uidationS S" PiniD!re!are na namin ang re!ort of disbursement Pina!aDnotari(e !o namin itong re!ort of disbursement na !irmado ng !residente ng "<O= accountant or boo3D3ee!er= at noted ng ChiefDofDStaff ng !ro!onent o 3ung yong naDassign na re!resentative galing sa o!isina ng !ro!onent o mismo yong !ro!onent T" Ano ibig mong sabihin sa !ro!onentS S" Qung mga la>ma3ers= yung Congressman o Senador !o 9,
90

-r :uy

-s Su5as also recounts on ho> she !artici!ates in the li1uidation of government funds= along >ith the family of &anet :imD"a!oles= her driver= househel!ers and gardeners?
THE CHAIRMAN O3ay= So= -s Su5as= basically= ang nangyari gumaga>a !o 3ayo ng foundations= nag3o3onta3 3ayo ng mga line agencies at inaayos ninyo iyong !roseso !ara iyong P.A% ma!unta sa line agencies+ from the line agency= !u!unta sa mga foundation na gina>a ninyo= at from the foundation= >ala ng li1uidation O iyong li1uidation !a!aano ginaga>aS MS SUNAS "ag3a3aroon din !o 3ami ng li1uidation After na3uha na !o namin iyong full !ayments !o sa agency= nagliDli1uidate din !o 3ami SinaDsubmit !o namin iyong li1uidations to the agency 3ung saan 3ami nagDim!lement THE CHAIRMAN So iyong do3umentong !angDli1uidate ay ga>aDga>a lang ninyoS <anoon !o ba iyonS

90

2aragdagang Sinum!aang Salaysay ni Benhur :uy Q 2ila!3ila!= Se!tember $0= 06$,= Pars $6# Id = Pars $69D$64

9,

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9#

MS SUNAS O!o 2ami na rin !o ang gumaga>a ng mga li1uidations !o 9#

-s Sula gives her o>n account on the li1uidation !rocess?

MS SULA A3o rin !o iyong tumutulong din !o na nagliDli1uidate !ag 3ailangan lang ng mga tao nila :i3e !o doon sa D eGam!le= doon sa list of beneficiaries= 3ami !o ni -s &anet "a!oles= &o Christine "a!oles= &ames Christo!her= &ohn :im= mga 3asambahay ang !ag!i!irma noIng mga list of beneficiaries noIng 066/ 2asi !o sa sobrang dami= lahat !o= !ati driver= 3asambahay= mga gardener Inaabot nga !o 3ami ng mga $0 oIcloc3 o $6 oIcloc3 sa office !o sa 0960 .iscovery CenterL 99 (*m!hasis

su!!lied)

Bhen 1uestioned about the li1uidation !rocess= &anet :imD"a!oles denied any 3no>ledge ;he >histleblo>ers= ho>ever= detailed &anet :imD"a!olesI !artici!ation in the li1uidation !rocess?
THE CHAIRMAN MMM

And so in the ending= ang last na lang= last stage >ould be the li1uidation -s "a!oles= 3a!ag ha>a3 mo na da> iyong !era= naD>ithdra> na sa "<O= nagbibigay 3ayo ng utos na magDli1uidate na At ayon 3ay -erlina Su5as= iyong li1uidation documents= ga>aDga>a na lang In fact= sabi ni -ary Arlene Balta(ar= maraming mga !e3eng beneficiaries na na3alista sa li1uidation ;otoo ba itoS MS NAPOLES @indi !o totoo THE CHAIRMAN @indi totoo -erlina= do you confirm thisS MS SUNAS iyong mga !angalan !o ng beneficiaries na !e3e ay totoo !o Uyon dahil Uyon !o ang inuutos niya sa amin THE CHAIRMAN ;otoong anoS MS SUNAS ;otoong fa3e !o iyong mgaL
;S"? &mbaisa 7IID$= Se!tember 04= 06$,= $$?$0 A- Jhereinafter B:H* RIBBO" ;RA"SCRIP; %OR S*P;*-B*R 04= 06$,K at #CD#/

99

Id at /9D/4

Page 42 of 122

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THE CHAIRMAN BeneficiariesS MS SUNAS L!angalan !o ng mga beneficiaries THE CHAIRMAN So 3un>ari yong !era natangga! nitong mga taong ito= ganon !o ba UyonS MS SUNAS @indi !o= Qour @onor THE CHAIRMAN Paano UyonS MS SUNAS 2asi itong mga beneficiaries !o na ito ay >ala !o silang natangga! ni isang item !o dahil iyong !era !o na naD>ithdra> ng "<O ay niDremit !o naming lahat 3ay -rs "a!oles THE CHAIRMAN -arina MS SULA "agsisinungaling !o siya 3asi doon !o sa list of beneficiaries na mga !e3e= !umirma din !o siya doon 3asama ang mga ana3 niya THE CHAIRMAN Pumirma si -s "a!olesS MS SULA "ame3e rin !o siya ng !irma doon= si -adam "a!oles= sa mga list of beneficiaries 2asi doon !o 3ami !umi!irma ng mga list of beneficiaries sa conference room Pag maramingDmarami na!o= galing doon siya sa office niya= >ala siyang gaga>in= !u!unta !o siya doon at ma3i3isalo !o siya sa amin na !umirma noIng mga !e3eng !irma ng mga list of beneficiaries Ang dami !o naming 3lase ng ball!en Siya rin !o !umi!irma doon THE CHAIRMAN ;otoo ba ito= -s "a!olesS MS NAPOLES @indi !o THE CHAIRMAN @indi 3ayo beneficiaries= ganoon !o ba UyonS MS NAPOLES @indi !o MR LU( Sir THE CHAIRMAN Benhur MR LU( O!o -eron !o 3ami= sir na mga list of beneficiaries 3aya !o ang audit re!ort na lumalabas na meron talaga iilan doon na !angalan nila= ta!os hindi Uyon ang !irma nila So= !aano !o naming Uyon R Page 43 of 122 !umi!irma= hindi nag!e!e3e ng

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35
94

nag3a3aron 3ami ng 3o!ya ng listahan ng Rbu3od !a 3ase sa ginaga>a !ong nag!e!e3e ng R THE CHAIRMAN Pa3iulit ulit iyong !arang R MR LU( Sa COA Re!ort= sir= may mga findings lumalabas na sila iyong mga tao na Uyon !ero hindi Uyon ang !irma nila THE CHAIRMAN Ah= so totoong tao !eroL MR LU( Pero hindi iyon ang !irma nila THE CHAIRMAN L hindi !irma nila HhDhuh= I seeL94 (*m!hasis

su!!lied)

;he aboveDmentioned statements highlight ho> government funds >ere diverted a>ay from the intended beneficiaries and !laced into the !rivate !oc3ets of certain individuals 1/& S#litting o< t=e Loot

-s Su5as gave the follo>ing brea3do>n of the 3ic3bac3s on the P.A% Scam and the individuals involved?
T" -aari mo bang i!ali>anag ang ibig mong sabihin na ang !ondo na sa hali! na!unta sa da!at na beneficiaries ay na!unta 3ay -adame &enny at sa mga senadorS S" .ahil sa ang !ondo mula sa P.A% na da!at ma!unta sa mga !roye3to ay !inaghahatian :imam!ung !orsyento (96V) sa mambabatas= limang !orsyento (9V) sa Chief of Staff ng mambabatas= sam!ung !orsyento ($6V) sa im!lementing agency at ang natitirang tatlum!uIt limang !orsyento (,9V) ay na!u!unta 3ay -adame &enny T" -aaari mo bang sabihin 3ung !aano mo nalaman ang sistema ng hatian na iyong binanggitS S" Sinasabi sa amin ni -adame &enny
9E

(*m!hasis su!!lied)

;S"? -hule! IMD$= "ovember E= 06$,= $$?9C A- F @S<aya!a MD$= "ovember E= 06$,= $0?6C P- Jhereinafter B:H* RIBBO" ;RA"SCRIP; %OR "O7*-B*R E= 06$,K at E#DEE
9E

2aragdagang Sinum!aang Salaysay ni -erlina Su5as Q Pablo= Se!tember $0= 06$,= Pars 9$D90

Page 44 of 122

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-s Su5as remained steadfast in her testimony even >hen &anet :imD"a!oles

denied 3no>ledge of this 's!litting?)

THE CHAIRMAN MMM

Ayon 3ay -erlina Su5as= sinabi mo sa 3anya na ang hatian ng P.A% R iyong hatian ganito? 96 !ercent sa la>ma3er= sa mambabatas So= 3ung $66 million iyon di 96 million sa la>ma3er+ five !ercent sa mga chief of staff+ ta!os= $6 !ercent sa mga head ng im!lementing agency+ ta!os= iyong natitirang ,9 !ercent ay na!u!unta sa inyo ;otoo ba itoS MS NAPOLES @indi ho THE CHAIRMAN -erlina= !a3iDconfirm lang MS SUNAS ;otoo iyon !o= Senador= 3asi hindi !o naming nalalaman iyan 3ung hindi niya sinasabi sa amin na ito !o ang hatian na !ag senador= 96 !ercent= $6 !ercent sa im!lementing agency+ ta!os 9 !ercent doon sa agent at mayroon !a rin siyang binigay na $ !ercent !ara sa "<O THE CHAIRMAN Para sa "<OS MS SUNAS O!o THE CHAIRMAN Pero 3ayuD3ayo rin iyong "<O= hindi baS MS SUNAS O!o Pero iyon !o ang !romise !o niya sa amin Pero hindi !o binibigay THE CHAIRMAN @indi binibigayS MS SUNAS O!o THE CHAIRMAN O3ay Ang na3i3ita natin dito= na!a3aDorgani(ed na ng scheme Pati iyong hatian= very very organi(ed 9C (*m!hasis su!!lied)

9C

B:H* RIBBO" ;RA"SCRIP; %OR "O7*-B*R E= 06$,= su!ra note 94= at ,4D,E

Page 45 of 122

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;his s!litting of the loot among &anet :imD"a!oles= the legislators= the Chiefs of Staff of the legislators= and the im!lementing agency effectively dis!ossessed the beneficiaries of >hat is due them 1/3 .=o re>ei@es 4i>F?a>Fs

-r :uy is familiar >ith the individuals >ho receive 3ic3bac3s from &anet :imD "a!oles= because he >as the one tas3ed to record all financial transactions of &anet :imD"a!oles= her cor!orations= and &anet :imD"a!olesDcontrolled "<Os -r :uy >as also able to record the officials >ho received !ayment from &anet :imD"a!oles based on the cash vouchers signed by the officials or their re!resentatives?
Ang !era na binibigay sa mga 3ausa! ni <ng "a!oles ay na3atala sa record of financial transactions ni Benhur 2 :uy= dahil siya ang naatasan ni <ng "a!oles na magDrecord mula Se!tember 066# hanggang &uly 06$6 :ahat ng financial transaction ni <ng "a!oles at ang mga "<Os= 3abilang ang mga o>nedDorDcontrolled cor!orations ni <ng "a!oles= ay nire3ord ni Benhur 2 :uy na 3ung saan ang !inagbabasehan niya ay ang mga Cash 7ouchers ng &:" Cor!oration na nag!a!a3ita rin ng mga signatures ng mga o!isyal o re!resentante ng o!isyal na tumangga! nito 9/

-r :uy further eG!ounded on these cash vouchers?

<aya !o ng sinabi 3o= a3o !o ang inuutusan ni -adame &anet :im "a!oles na guma>a ng mga do3umento at maghanda ng !era !ara sa rebates ng mga senador o congressman na mga ito -ay voucher !o 3asi ang mga !era na lumalabas sa &:" Cor!oration .oon sa voucher ay na3alagay ang !angalan ng taong !agbibigyan gaya ng Senador o Chief of Staff nila= o Congressman= o sinumang !ublic official na 3umu3uha ng rebates sa mga government !ro8ects na i!inatutu!ad ng "<Os o foundations ni -adame &anet :im "a!oles 46 (*m!hasis su!!lied)

9/ Pinagsamang Sinum!aang Salaysay of Benhur 2 :uy= -erlina P Su5as= <etrudes 2 :uy= "ova 2ay BatalD-acalintal= *lena S Abundo= F Avelina C :ingo= Se!tember $$= 06$,= Par 9 46

2aragdagang Sinum!aang Salaysay ni Benhur :uy Q 2ila!3ila!= Se!tember $0= 06$,= Par 9$

Page 46 of 122

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4$

;hese vouchers are colorDcoded and each !arty receives their o>n co!y?
THE CHAIRMAN O3ay ;a!os= Udi ba= Benhur= dito sa mga vouchers may mga color coding !a 3ayo R mayroong >hite= may yello>= tama !o ba iyonS MR LU( Qes !o= sir Ang >hite !o= sa original ledger ng R or file ng !ro!onent= ng la>ma3ers+ ta!os ang yello>= sa accounting= >hich a3o naman !o iyong accounting THE CHAIRMAN So sa iyo !umu!unta iyong yello>S MR LU( O!o ;a!os ang !in3 !o na!u!unta !o iyon sa mga 3ausa!= sa chief of staff= sa la>ma3ers at sa3a din !o iyong mga nagDeDagentDagent 3asi iyon !o iyong 3atibayan naming= sir 2aya !o may 3o!ya sila= iyon !o iyong 3atibayan naming !ag nag3a!roblema 3ami sa com!utation= !ag hindi nagDtally ang records sa !ag3uha !o na 3anilang 3omisyon 4$

;he vouchers= ho>ever= >ere unfortunately destroyed u!on the orders of &anet :imD"a!oles?
THE CHAIRMAN So ang dami talagang dou3umento na 3atibayanS MR LU( O!o Sir= at sa3a !o bu3od !o sa voucher= ang gusto !o din ni -s "a!oles 3asi R 3asi bu3od sa voucher= mayroon !ong endorsement letter at sa3a signed memorandum of agreement Iyon !o iyong 3atibayan na talagang natangga! din nila 3asi ang o!isina !o ay naninigurado din na talagang may do3umento 3ami na !angha>a3an THE CHAIRMAN Pero nasaan na itong mga do3umentoS MR LU( "oon dinitain (detain) !o a3o noong .ecember $/= hindi 3o na !o alam 3ung ano na sunod na nagyari sa mga documents na iyon THE CHAIRMAN -s "a!oles= totoo ba itoS MS NAPOLES @indi !o THE CHAIRMAN Ano iyong totooS MS NAPOLES @indi 3o alam sa 3anila

B:H* RIBBO" ;RA"SCRIP; %OR "O7*-B*R E= 06$,= su!ra note 94= at #0D#,

Page 47 of 122

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THE CHAIRMAN @indi mo alam sa 3anila O3ay MS SULA Sir THE CHAIRMAN -arina= yes MS SULA O!o ;otoo !o may mga voucher na ginagamit ang &:" Cor!oration 2atunayan nga !o= 3aming dala>a ni Arlene Balta(ar ang mag3atulong na siniDshred naming lahat ng mga !ro8ect at sa mga voucher doon sa Pacific Pla(a ;o>er 40

Bhile the vouchers >ere no longer !resented as evidence= the >histleblo>ers themselves have identified the individuals >ho >ere able to receive 3ic3bac3s Aside from &anet :imD"a!oles= the reci!ients of P.A% 3ic3bac3s= as testified by -r :uy= are the legislators= their res!ective chiefs of staff andAor re!resentatives= and the heads of im!lementing agencies 1/3' Legislators

Bhile -r :uy has admitted that he did not !ersonally hand over 3ic3bac3s to the Senators involved >ith the P.A% Scam= he has nonetheless !ersonally delivered 3ic3bac3s to the Congressmen and the Chiefs of Staff of the Senators
4,

-r :uy

furthermore disclosed that codenames are assigned to la>ma3ers they dealt >ith?
T" -aaari mo bang sabihin 3ung anuDano ang mga 'codenames) ng mga 3aDtransact ni &anet :im "a!oles na !uliti3o o 3anilang ChiefDofDStaffS S" O!o ';A".A) 3ay Senator &uan Ponce *nrile= 'S*MQAA"A2A2HQA) 3ay Senator &inggoy *strada= 'PO<I) 3ay Senator Bong Revilla= '<H*RR*RA) 3ay Congressman Ri(alina SeachonD:anete= 'BO"&I"<) 3ay Congressman Rodolfo Pla(a= 'BH:A2:A2) 3ay Congressman Samuel .ang>a= 'SH@A) 3ay Congressman Arthur Pingoy= at '2HRQ*";*) 3ay Congressman *dgar

40

Id at #,D## 2aragdagang Sinum!aang Salaysay ni Benhur :uy Q 2ila!3ila!= Se!tember $0= 06$,= Par 4E

4,

Page 48 of 122

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4#

7alde( -ayroon !a !o ibang codename nasa records 3o Sa ngayon !o ay sila lang !o ang a3ing naalala 4#

In their affidavit=49 -r :uy and -s Su5as detailed the amount of money received by the legislators based on -r :uyIs accounting records from 066#D06$6?
E $ P.A% ni Senator Ramon Revilla III na ang tumangga! sa 3omisyon na naitala ay si Atty Richard Cambe? a) Hsa!an sa 3omisyon R 96V b) 2abuuan na P.A% R P490=666=666 66 c) 2abuuan na 3omisyon R P,04=666=666 66 d) "aitala na 3omisyon R P 00#= 9$0= 966 66 E 0 P.A% ni Sernator &uan Ponce *nrile na ang tumangga! sa 3omisyon na naitala ay sina -s Ruby ;uason at Atty &essica '<igi) Reyes? a) Hsa!an sa 3omisyon R 96V b) 2abuuan na P.A% R PE04=996=666 66 c) 2abuuan na 3omisyon R P,4,= 0E9=666 66 d) "aitala na 3omisyon R P$E0=C,#=966 66 E , P.A% ni Senator &inggoy *strada na ang tumangga! ng 3omisyon na naitala ay si -s Pauline :abayen? a) Hsa!an na 3omisyon R 96V b) 2abuuan na P.A% R PE9$=966=666 66 c) 2abuuan na 3omisyon R P,E9=E96=666 66 d) "aitala na 3omisyon R P $C,=E/,=E96 66 E # P.A% ni Re! Ri(alina SeachonD:anete na ang tumangga! ng 3omisyon na naitala ay si &ose Sumal!ong? a) Hsa!an na 3omisyon R 46V (066#D06$6) 96V (06$$) b) 2abuuan na P.A% R P066=949=666 66 c) 2abuuan na 3omisyon R P$06= ,,/=666 66 d) "aitala na 3omisyon R P$6C=#69=666 66 E 9 P.A% ni Re! *dgar 7alde( na siya mismo ang naitalang tumangga! ng 3omisyon? a) Hsa!an ng 3omisyon R 96V b) 2abuuan na P.A% R P$09=666=666 66 c) 2abuuan na 3omisyon R P40=966=666 66 d) "aitala na 3omisyon R P9E=ECE=966 66

Id = Par 46 Pinagsamang Sinum!aang Salaysay ni Benhur :uy= -erlina SuZas= et al = Se!tember $$= 06$,= Par E

49

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44

E 4 P.A% ni Re! Rodolfo Pla(a na siya mismo ang naitalang tumangga! ng 3omisyon? a) Hsa!an na 3omisyon R 96V b) 2abuuan na P.A% R PE9=666=666 66 c) 2abuuan na 3omisyon R P,E=966=666 66 d) "aitala na 3omisyon R P#0=$,E=C66 66 E E P.A% ni Re! Samuel .ang>a na siya mismo ang naitalang tumangga! ng 3omisyon? a) Hsa!an na 3omisyon R 96V b) 2abuuan na P.A% R P9#=666=666 66 c) 2abuuan na 3omisyon R P0E=666=666 66 d) "aitala na 3omisyon R P04=EE6=#E0 66 E E P.A% "i Re! Constantino &araula na siya mismo ang naitalang tumangga! ng 3omisyon? a) Hsa!an na 3omisyon R 96V b) 2abuuan na P.A% R P99=666=666 66 c) 2abuuan na 3omisyon R P0E=966=666 66 d) "aitala na 3omisyon R P06=C#,=E96 66 44

&anet :imD"a!oles denied these transactions during the "ovember E= 06$, hearing of the Blue Ribbon Committee?
THE CHAIRMAN MMM -s "a!oles MS NAPOLES O!o THE CHAIRMAN Oo Bhat do you feel about iyong sinabi ni R itong mga transaction= mga ledgers ni Benhur na= admittedly= siya iyong chief financial officer mo= record 3ee!ing officer mo= anoIng masasabi mo ritoS MS NAPOLES @indi ho siya ang chief financial ano 3o R THE CHAIRMAN O3ay Ano siyaS MS NAPOLES Sa admin lang !o siya 3asi lagi !o siyang may 'religious) 3aya bihira lang siya sa office "gayon= siya ho ang may ga>a niyan so hindi 3o ho alam 3ung ano Uyun THE CHAIRMAN BenhurS

%OR

-r :uy also stated these transactions in the "ovember E= 06$, @earing of the Blue Ribbon Committee B:H* RIBBO" ;RA"SCRIP; "O7*-B*R E= 06$,= su!ra note 94= at 40D49

Page 50 of 122

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MR LU( Since nabanggit niya !o= sir= na 'religious=) then ito !o iyong sinasabi 3o iyong totoo na a3ing records Ang !osisyon 3o !o= sir= is finance officer na nilagay niya Ang senior 3o !o iyong ana3 niya R ang 7P for admin and finance= iyong ana3 nya na si &o Christine ;a!os 3ung >ala !o iyong &o Chrisitine "a!oles= si Reynald :uy :im= iyong 3a!atid niya At hindi !o a3o mag3a3aroon ng record 3ung hindi !o ito inDassign sa a3in R ang records na ito R at hindi din !o a3o mag3a3aroon ng 3o!ya ng mga ban3 accounts 3ung hindi rin !o siya nagbigay sa a3in So= iyon !o ang totoo THE CHAIRMAN O3ay ;han3 you 4E

Bhile &anet :imD"a!oles may deny that -r :uy is not her 'chief financial officer=) transcri!ts of the Blue Ribbon Committee >ill sho> that -r :uy= in testifying= has consistently eG!lained the transactions of -s "a!oles in detail %urthermore= -s Ruby Chan ;uason= >ho resurfaced a!!roGimately siG (4) months from the start of the Blue Ribbon CommitteeIs series of P.A% scam hearings une1uivocally testified that she !ersonally and directly delivered 3ic3bac3s to an accused legislator -s ;uason described several instances of dis!ensing 3ic3bac3s to legislators either !ersonally and directly= or through their re!resentatives In describing an instance of delivering 3ic3bac3s faceDtoDface= -s ;uason stated under oath the follo>ing statement? 'I !ersonally delivered all the shares of Senator &inggoy *strada )4C (*m!hasis su!!lied) Bhen as3ed to describe her role in the P.A% scam= -s ;uason herself described herself as a 'goDbet>een?)
4E

Id at 4ED4C S>orn Statement of Ruby C ;uason= %ebruary #= 06$# at C

4C

Page 51 of 122

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THE CHAIRMAN So your relationshi! >ith Senator &inggoy *strada as a R ho> shall I call it R ho> >ould you describe your relationshi!= as a bro3er= middlemanS MMM MS TUASON A goDbet>een THE CHAIRMAN A goDbet>een O3ay= a goDbet>een In >hich you delivered from time to time sums of money as 3ic3bac3 from !ro8ects MMM
4/

-s ;uason further recounted that she >ent to the SenateE6 at least thrice in 066CE$ to hand over= in !erson= Senator *stradaIs 3ic3bac3s from the P.A% scam In her testimony before the Committee= she recounted an instance of going to the Senate to !ersonally deliver around eight to ten million !esosE0 >orth of 3ic3bac3s to Senator *strada?
MMM SEN TRILLANES *ight to ten million O3ay Qou >ent u! the elevator MS TUASON Qes SEN TRILLANES Qes ;hen= saan !oS MS TUASON ;hen= I >ent to the Office of Senator *strada SEN TRILLANES Pag3ata!os hoS

4/

;S"? R&Orti( I7D$= %*BRHARQ $,= 06$#= /?,4A- F <Sa!inoso 7D$= %*BRHARQ $,= 06$#= /?#4A- Jhereinafter= B:H* RIBBO" ;RA"SCRIP; %OR %*BRHARQ $,= 06$#K at ,4D,E

;he Office of the SergeantDatDArms (OSAA) of the Senate= in a letter dated $6 -arch 06$# addressed to the Senate President= submitted the first of its !eriodic re!ort (in com!liance >ith the order of the Blue Ribbon Committee dated $, %ebruary 06$#) regarding the revie> of the SenateIs closed circuit television (CC;7) footages= >hich sho>s a >oman resembling -s Ruby ;uason visiting the Senate bet>een "ovember and .ecember 066C As such no conclusion can be dra>n from the !reliminary re!ort submitted by the OSAA)
E$

E6

Id = at 0/ Id = at /6

E0

Page 52 of 122

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MS TUASON Inilalagay doon sa loob ng 3anyang !rivate room= doon sa may tabi ng silya niya SEN TRILLANES So nandodoon !o ba siyaS MS TUASON Qeah SEN TRILLANES Qes MS TUASON Ay= sorry ;here >as a time na he >asnIt there because he >as in session I 8ust >ait for him But usually= nandoon siya SEN TRILLANES O3ay Pero 3inoDconfirm ninyo= 'O= ito na ) At least may formal turnover or at least eye contact MS TUASON Alam niya na darating a3o ;umata>ag ho a3o sa 3anya SEN TRILLANES ;a!os ho= >hatS MS TUASON I >ould tell him= 'O= !u!unta a3o diyan= dadalhin 3o iyong ano=) ganooon lang ;hen= I >ould bring it= give it= and I >ould leave it >ith him SEN TRILLANES So binubu3san niya= binibilang or automatic na alam niya na ho> muchS MS TUASON @e has an idea ho> much SEN TRILLANES Bho >ould give him that ideaS MS TUASON Qeah Alam niya ho ang matatangga! niya SEN TRILLANES @o> much ho ang matatanggao niya at that dayS Bho >ould give him that idea na iyon iyong ano or 3ung may balance !a or tama D MS TUASON -ost li3ely= a3o ang magsasabi sa 3anya SEN TRILLANES Iyon na nga ho R ho> do you do thatS MS TUASON I 8ust tell him :etIs say for eGam!le= 'Ayan= eight million ) SEN TRILLANES Ah= o3ay So mali>anag ho= sinasabi ninyo sa 3anya= 'O= eight million ito=) then thereIs that formal turnover= rightS) MS TUASON Qes Page 53 of 122

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E,

SEN TRILLANES O3ay So you did that in a cou!le of instances dito sa sa Senate= yesS MS TUASON Qeah
E,

(*m!hasis su!!lied)

Aside from delivering 3ic3bac3s to the Senate= -s ;uason also >ent to >herever Senator *strada is to !ersonally give Senator *strada his 3ic3bac3s? At Senator *stradaIs residence R
MMM SEN TRILLANES And sometimes in his house in <reenhills R MS TUASON @e doesnIt count it SEN TRILLANES Qes Pero sinasabi ninyo= ibinibigay ninyo sa 3anya !ersonally= directly 3ay Senator &inggoy *stradaS MS TUASON Qes E# (*m!hasis su!!lied)

At a 'comedy bar?)
THE CHAIRMAN L Aside from that >here elseS Bhat other venues did you deliverS MS TUASON One time he called me u!= he needed some cash that night so I >ent R I >as at that time >ith -rs "a!oles and her husband and >e dro!!ed it off R only one million R >e dro!!ed it off in front of his R he had li3e a comedy bar !lace on Bilson THE CHAIRMAN A >hatS Sorry MS TUASON :i3e a comedy barS THE CHAIRMAN .o you 3no> the nameS MS TUASON Pir3oh

Id = at /$D/0 Id = at /,

E#

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E9

THE CHAIRMAN Pir3oh At Bilson Street= that is <reenhillsS MS TUASON Qes MMM
E9

As regards Senator *nrileIs 3ic3bac3s= -s ;uason categorically stated that she !ersonally and directly handed over Senator *nrileIs P.A% 3ic3bac3s to his Chief of Staff= Atty &essica '<igi) Reyes?
+" .o you 3no> if any transaction of &anet "a!oles involving the P.A% of Senator *nrile >as consummated or com!letedS A" Qes= sir &anet "a!oles com!leted or consummated transactions involving the P.A% of Senator &uan Ponce *nrile +" Bhy do you 3no> thisS A" I 3no> it because I !ersonally received the share of Senator &uan Ponce *nrile from &anet "a!oles and !ersonally gave it to Atty <igi Reyes= >ho in turn !ic3ed it u! !ersonally in my house or in a restaurant >here >e both agreed to meet (*m!hasis su!!lied)E4

-s ;uason identified the restaurants >here she !ersonally gave 3ic3bac3s to Atty Reyes ;here >ere also occasions >hen Atty Reyes >ould !ic3 u! Senator *nrileIs share from -s ;uasonsIs house= as attested by -s ;uason?
THE CHAIRMAN Qou do not remember the amount eGactly Bhat >ere the !laces for the record= !leaseS MS TUASON Qeah ;he !laces >here I delivered >ere restaurants li3e -amou= ;su3i8i Be have also been to HCC= :IO!era= and <ourmand and ho> many times she !ic3ed u! from my house THE CHAIRMAN She >ould D S

Id = at ,0 S>orn Statement of Ruby C ;uason= %ebruary #= 06$#= su!ra note 4C at /D$6

E4

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EE

MS TUASON She >ould !ic3 it u! from my houseS THE CHAIRMAN She >ould also !ic3 it u! from your house Bhen it >as !ic3ed u! in your house and >hen you are in these restaurants >hen you turned it over= >ere you >ith anyoneS In other >ords= >as there anyone that >itnessed itS MS TUASON Bhen >e >ere in restaurants= if= let us say= >e >ere in the R sa may Serendra= let us say THE CHAIRMAN Serendra R oo MS TUASON So may car R I >ill go do>n I mean= >hen >e enter the drive>ay= I >ill go do>n and if her driver is standing there= it >ould be handed to him @e doesnIt 3no> naman >hat is inside And besides= he is very trusted THE CHAIRMAN It >ill be handed to him= the driver MS TUASON Qes THE CHAIRMAN Of R MS TUASON Of Atty Reyes THE CHAIRMAN Of Atty Reyes MS TUASON And I guess he >ill !ut it in their car And I >ill !roceed to the restaurant THE CHAIRMAN Qou dro! off the money to the driver and then you go !roceed to the restaurant MS TUASON If she is there= because sometimes= she is not So I bring the bag >ith me to the restaurant EE

;he aforementioned testimony regarding Senator *nrile 8oining them for coffee is also found in -s ;uasonIs affidavit?

+" Bas Atty <igi Reyes alone >hen she received or !ic3edDu! the money for Senator *nrileS
B:H* RIBBO" ;RA"SCRIP; %OR %*BRHARQ $,= 06$#= su!ra note 4/= at #CD96

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EC

A" Atty <igi Reyes >ould !ic3Du! the money alone I remember occasions that Senator &uan Ponce *nrile >ould 8oin us= >hen >e are almost done= for a cu! of coffee +" On the occasions that Senator *nrile >ould be !resent at the designated restaurant= ho> long >ould he stayS A" @e did not stay long After coffee= he >ould leave and sometimes he >ould come to !ic3Du! Atty <igi Reyes EC

Senator -iriam .efensorDSantiago= in her inter!ellation of -s ;uason regarding Senator *nrileIs act of 8oining them for coffee= suggested that the latterIs demeanor is incriminatory?
SEN $EFENSOR-SANTIAGO Pero mayroong isang incident na nasa 3ainan 3ayo and you tal3 business= !erha!s money eGchanges= and then Senator *nrile >ould come and 8oin you for a cu! of coffee Or sometimes= you said= '@e >ould !ic3 u! Atty <igi Reyes ) ;hat is in your affidavit Am I 1uoting you correctlyS MS TUASON Qes= maIam SEN $EFENSOR-SANTIAGO "gayon= !ag !umunta siya ng mata!os na ang usa!an ninyo ni <igi Reyes= may 3omentaryo ba siya tung3ol sa !eraS MS TUASON Si Senator !oS SEN $EFENSOR-SANTIAGO Oo MS TUASON Bala ho naman SEN $EFENSOR-SANTIAGO Bala= basta darating siya= iinom siya ng 3a!eS MS TUASON At aalis siya -insan 3asama niya si Attorney SEN $EFENSOR-SANTIAGO "ag!a!angga!D!angga!an siya na >ala siyang !a3ialam doon sa !inagDuusa!an ninyo 3asi >ala 3ang na3i3ita na overt act niyaS
S>orn Statement of Ruby C ;uason= %ebruary #= 06$#= su!ra note 4C at $$

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MS TUASON Bala !o SEN $EFENSOR-SANTIAGO "gayon= I >ant you to 3no> na 3ung >ala siyang 3ibo= that still is incriminatory because under the Civil Code of the Phili!!ines= silence means consent Alam niya 3ung ano ang !inagD uusa!an ninyo ba3it niya susunduin doon MMM E/ (*m!hasis su!!lied)

Bhat ma3es -s ;uasonIs testimony all the more im!ortant is that she confirmed and substantiated the testimonies of -r :uy and the rest of the >histleblo>ers

1/31

C=ie<s o< Sta<< or Re#resentati@es o< Legislators

As >as !reviously mentioned= -r :uy >as able to !ersonally give 3ic3bac3s to the Chiefs of Staff or re!resentatives of the Senators= >ho transacted >ith &anet :imD "a!oles ;he Chiefs of Staff or re!resentatives of senators >ho transacted >ith &anet :imD"a!oles >ere identified as follo>s?
T" -aaari mo bang sabihin 3ung sinoDsino itong mga tinutu3oy mong ChiefDofDStaff ng Senador na tumangga! ng !era na 'rebates) sa transaction 3ay &anet :im "a!olesS S" O!o Sina Atty Richard Cambe sa o!isina ni Senador Bong Revilla= -s Pauline :abayen= sa o!isina ni Senador &inggoy *strada= -s Ruby ;uason sa o!isina nina Senador &uan Ponce *nrile at Senador &inggoy *strada C6

Also= -s ;uason testified that she served as a goDbet>een lin3ing &anet :imD "a!oles and the Office of Senator &uan Ponce *nrile until she introduced Atty Reyes to

E/

B:H* RIBBO" ;RA"SCRIP; %OR %*BRHARQ $,= 06$#= su!ra note 4/= at $0$D$00

C6

2aragdagang Sinum!aang Salaysay at Benhur :uy y 2ila!3ila!= Se!tember $0= 06$,= !ar 4C

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&anet :imD"a!oles= from >hich time on &anet :im "a!oles decided to engage directly >ith the said Chief of Staff and to dro! -s ;uason as bro3er C$ 1/3/ I;#le;enting Agen>ies

Certain !ersonalities in the Im!lementing Agencies= >hich >ere originally mandated to eGecute the !ro8ects= >ere also given a share of the P.A%?
THE CHAIRMAN Sino yong mga agencies= mga im!lementing agencies na nabigyan niyo ng !eraS "abigyan ng !era= yong may hati -ay hatian din !ara sa mga line agencies= hindi ba= -r :uyS Pa3isagot lang MR LU( Qes= sir Qes= sir THE CHAIRMAN Ah= mayroon MR LU( Qes !o THE CHAIRMAN So= ang hatianDD sa legislator= sa line agency na nagD im!lement MR LU( Qes !o
C0

;he heads of the Im!lementing Agencies >ho received 3ic3bac3s from &anet :imD"a!oles >ere also named?
T" -ay nabanggit 3a na may $6V na na!u!unta sa !residente o head ng agency= sino itong tinutu3oy moS S" Ang alam 3o na3ita 3ong tumangga! ay sila A::A" &A7*::A"A ng "ABCOR= .*""IS CH"A"A" at A";O"IO Q OR;IP ng ;:RC= at si O%*:IA A<ABI" sa PR*C ng .A "asabi din sa a3in ni *velyn .e :eon na may inaabot din 3ina <I<I BH*"A7*";HRA at A:*MIS S*7I.A: ng ":.C C,

C$

B:H* RIBBO" ;RA"SCRIP; %OR %*BRHARQ $,= 06$#= su!ra note 4/ at = #4D#E B:H* RIBBO" ;RA"SCRIP; %OR S*P;*-B*R $0= 06$,= su!ra note ,,= at #4

C0

C,

2aragdagang Sinum!aang Salaysay ni Benhur :uy Q 2ila!3ila!= Se!tember $0= 06$,= Par $04

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-r :uy remained firm in his testimony that heads of im!lementing agencies also receive 3ic3bac3s even >hen faced >ith -s "a!olesI denial of these transactions?
THE CHAIRMAN Ayon din 3ay Benhur= -s "a!oles= binibigyan mo rin ng 3ic3bac3 hindi lang yung la>ma3er yung re!resentante ng la>ma3er= !ati yung o!isyal ng im!lementing agency= totoo ba ito= -s "a!olesS MS NAPOLES @indi !o= Qour @onor THE CHAIRMAN Benhur= !a3iDconfirm lang MR LU( "agsisinungaling !o siya= sir ;otoo !o iyon na nagbibigay !o siya sa mga o!isyal !o ng im!lementing agency 3asi may mga ibang o!isyal ng im!lementing agency ay !umu!unta rin !o sa o!isina at sa3a !o na3i3ita 3o rin !o yung !agDabot niya ng !era doon sa R 2asi a3o nga !o ang nag!eD!re!are ng voucher R THE CHAIRMAN So na3i3ita mo na si -s "a!oles nagbibigay ngL MR LU( Pera THE CHAIRMAN L!era MR LU( O!o THE CHAIRMAN SaS MR LU( @ead of the im!lementing agency THE CHAIRMAN Paano mo alam na !era yung inaabotS Ba3a naman sulat lang yung inaabot MR LU( @indi !o= sir= 3asi ang o!isina may tatlong vault dahil a3o !o yung R THE CHAIRMAN 7ault 3ee!er MR LU( %inance officer !o so may !era !o 3ami sa o!isina So !ag nagDinstruct na !o si -s "a!oles= 'ID!re!are mo at sa3a yung $6 !ercent commission nila=) so itaDty!e 3o na !o iyon ;a!os= !a!aDchec3 muna sa mga seniors 3o= 3ung hindi yung ana3 niyang si &o Christine= ta!os yung !era na ihahanda 3o So minsan !o !ina!aDcounter chec3 niya yung !era sa mga seniors 3o rin 3asi ba3a may 3ulang or ano !o 3asi magbibigay siya sa 3ausa!= so dadalhin 3o !o yung !era sa o!isina niya Or minsan !o= sir= may !ag3a3ataon na dala>a !o 3ami ni -adam na imiDmeet yung Page 60 of 122

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C#

tao ta!os 3asama !o a3o doon ta!os ibibigay namin !o yung !era !o nasa !a!er bag THE CHAIRMAN SinuDsino itong mga head ng agency na i3a> mismo ang !ersonal na na3a3itaS MR LU( Si -r Alan &avellana !o ng "ABCOR= ta!os !o si Antonio Orti( THE CHAIRMAN "g anong agencyS MR LU( "g ;:RC !o ;RC na ngayon= dati ;:RC
C#

1/5

HoC Fi>F?a>Fs are re>ei@e%

;he 3ic3bac3s from the P.A% Scam are received in the follo>ing forms? a) as %und ;ransfer+ b) as -anagerIs Chec3 or Personal Chec3 from &anet :imD"a!oles+ c) as Cash received from the Office of &:"= or delivered to the house of the legislators or their re!resentatives= or !ic3edDu! from &:"Is house C9 1/5' Legislators

.uring the committee hearing= -r :uy eG!ounded on ho> the :egislators receive their 3ic3bac3s?
THE CHAIRMAN ;a!os sa In1uirer article= I thin3 DD >hen is this DD today= na3alagay na yung mga tinangga! ng mga senador DD senador ha= ay cash basis da>= tama ba iyonS Actually= ang 3ino>t (1uote) si Atty Baligod Pero you >ere 1uoted Sa naaalala mo= yung mga senador !aano ang !agtangga! nila= cash= tse3eS MMM MR LU( Senador lang ho ba or !ati :o>er @ouseS THE CHAIRMAN Iyan ang tanong 3o muna= senador muna MR LU( Cash !o
B:H* RIBBO" ;RA"SCRIP; %OR "O7*-B*R E= 06$,= su!ra note 94= at 99D9E

C9 Pinagsamang Sinum!aang Salaysay of Benhur 2 :uy= -erlina P Su5as= <etrudes 2 :uy= "ova 2ay BatalD-acalintal= *lena S Abundo= F Avelina C :ingo= Se!tember $$= 06$,= Pars 9 $= 9 $ $= 9 $ 0= 9 $ ,

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THE CHAIRMAN Cash= hindi tse3e MR LU( -eron !o na -C !ero hindi !o na3a!angalan sa senador THE CHAIRMAN -C O3ay Qung sa :o>er @ouse MR LU( %und transfer ho= fund transfer So= nagbibigay !o sila ng account number ta!os 3ineDcredit namin sa account nila THE CHAIRMAN Account nila MR LU( O!o THE CHAIRMAN Ban3DtoDban3 MR LU( Qes !o THE CHAIRMAN O3ay MR LU( ;a!os yung sometimes !o DD 3ung hindi !o yung congressman= yung chief of staff So= may account number din ho 3ami sa chief of staff= 3ineDcredit namin sa account ng chief of staff THE CHAIRMAN O3ay I3a> ba= have you everDD na3a3ita 3a ba ng !agbibigay sa isang senadorS MR LU( Bala !o THE CHAIRMAN Bala Sino yung mga naghahatid sa mga senador ng !eraS MR LU( Sa senador !o 3asi= sir= !umu!unta !o yung mga chief of staff sa office So= ang nangyayari !oDD THE CHAIRMAN Ah= sinusundo yung !era= hindi hinahatid yung !era MR LU( O!o= hindi !o Pero may instances !o naDD aya> 3o naman magDcommentDD si -rs "a!oles !ina!aD!re!are niya sa amin yung !era So= halimba>a= letIs say= 06 million ta!os sabi niya na may 3ausa! siyang senador @indi naman niya binabanggit sa amin may 3ausa! siyang senador .adalhin niya yung !era na iyon !ag nagmimeeting sila= ganon THE CHAIRMAN So= si -rs "a!oles mismo

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C4

MR LU( Qes Pero yung chief of staff !o !umu!unta !o sa o!isina= 3inu3uha nila yung !era or sometimes 3asama ho sila sa bang3o sa !agD >ithdra> ng !era C4

;herefore= the Senators received their 3ic3bac3s in the follo>ing forms? a) as Cash !ic3ed u! by their Chief of Staff from the &:" office or delivered by &anet :imD "a!oles herself+ or b) as a -anagerIs Chec3 (but not in the name of the Senators) 1/51 C=ie<s o< Sta<< or Re#resentati@es o< Legislators

-s Su5as eG!lained ho> the Chiefs of Staff or re!resentatives of legislators receive their 3ic3bac3s?
T" Sa mga Chief of Staff naman= !aano nila na3u3uha ang 3anilang !orsiyentoS S" Qung !orsiyento ni Atty Richard Cambe ay sinasabay na niyang 3inu3uha 3a!ag 3u3unin niya yung !orsiyento ni Sen Ramon Revilla= &r at si Pauline :abayen ay !umu!unta mismo sa o!isina ng &:" Cor!oration Ang !orsiyento naman ni Atty <igi Reyes ay !ina!adala ni -adame &enny 3ay %ernando Ramire( o 3ay &ohn Raymund de Asis sa bahay ni Atty Reyes mismo CE

-s Su5as stated under oath that she !ersonally gave Atty Richard Cambe his 3ic3bac3?
T" Ba3it i3a> ang !inuntahan at sa iyo 3inuha ni Atty Richard Cambe ang !orsyento ni Sen Ramon Revilla &r S S" .ahil noong !anahon na iyon ay a3o ang nasa o!isina at sa a3in !inabibilin ni -adame &enny na !u!unta si Atty Richard Cambe !ara 3uhain ang !era T" -ata!os ma3uha ni Atty Richard Cambe ang !era= mayroon ba siyang !inirmahan na do3umento bilang !atunay na na3uha niya ang !eraS S" O!o= !umi!irma siya ng disbursement voucher
B:H* RIBBO" ;RA"SCRIP; %OR S*P;*-B*R $0= 06$,= su!ra note ,,= at #$D#,
CC

CE

2aragdagang Sinum!aang Salaysay ni -erlina Su5as Q Pablo= Se!tember $0= 06$,= Par 49 Id = Pars 40D4,

CC

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-r :uy also s>ore that he !ersonally handed 3ic3bac3s to the Chiefs of Staff or the re!resentatives of the :egislators?
T" -aari mo bang sabihin 3ung ba3it i3a> ang nagDabot ng !era na 'rebates) sa transaction ni &anet :im "a!oles sa mga !inangalanan mong ChiefDofDStaff o re!resentative ng Senador at mga CongressmanS S" <anoon naman ang 3ala3aran sa o!isina 3ung >ala si -adame &anet :im "a!oles 2a!ag may !umu!untang tao sa o!isina !ara 3umuha ng !era ay sinasabihan na 3ami ni -adame &anet :im "a!oles !ara maghanda ng !era at 3ami na mismo ang nagDaabot ng !era Binibilang namin ito sa hara! ng tatangga! bago namin iabot at !ina!a!irma namin sila !ara i!a3ita 3ay -adame &anet :im "a!oles 3a!ag !inagDre!ort niya 3ami C/

1/5/

I;#le;enting Agen>ies

.uring the Committee @earing= -r :uy testified that he !ersonally sa> &anet :imD"a!oles giving money to the heads of the Im!lementing Agencies?
SEN ESCU$ERO M M M "abanggit niyo may diyes !orsyento 3ayong binibigay sa im!lementing agency at nabanggit nyo din= <inoong :uy= na na3ita niyo mismong nagbibigay 3ayo sa mga im!lementing agencies Actual na na3ita niyo nag3a3abigayan !o ng !era doon sa mga binanggit ninyo sa affidavit niyoS MR LU( Ano !o= si -s "a!oles !o 2asi sinama !o a3o ni -s "a!oles SEN ESCU$ERO So siya= ang nagbigayS MR LU( Qes !o /6

C/

2aragdagang Sinum!aang Salaysay ni Benhur :uy Q 2ila!3ila!= Se!tember $0= 06$,= Par E6
B:H* RIBBO" ;RA"SCRIP; %OR S*P;*-B*R 04= 06$,= su!ra note 9#= at $,9

/6

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/$

%or the heads of Im!lementing Agencies= it is &anet :imD"a!oles >ho !ersonally gives their 3ic3bac3s Bhile -r Cunanan denies being a beneficiary of any 3ic3bac3 from P.A%= his allegation of certain legislators hand!ic3ing "<Os and !ersonally as3ing for u!dates regarding their res!ective P.A%s still holds merit= as this brings to light the li3elihood of legislators orchestrating the transfer of !ublic funds to "<Os of their o>n choosing Senator .efensorDSantiago averred the relevance of -r CunananIs contention?
SEN $EFENSOR SANTIAGO But for no> R so= in effect= as usual li3e in a courtroom= although this is not a courtroom= >e are not bound by the technical rules of evidence In effect= >e have to rely on your credibility It becomes crucial to finding out >hether the senators and the congressmen chose their "<Os or did not choose their "<Os and in fact= are claiming they had nothing to do >ith it MMM (*m!hasis su!!lied)/$

-r CunananIs denial of benefitting from P.A% 3ic3bac3s and his assertion that certain senators !ersonally intervened in the selection of "<Os are mutually eGclusive A !ersonIs natural im!ulse is to defend himself from blame But this act of denial does not eradicate his !ersonal 3no>ledge of the crime @is !resentation of documents to bolster his allegations are >orthy of note
/0

CunananIs !artici!ation must be eGamined

closely by the court regardless of his !ersonal guilt or innocence= his testimony about the other !artici!ants of the crime remains inde!endently valuable to the court= es!ecially if it can be confirmed by other !ieces of evidence

B:H* RIBBO" ;RA"SCRIP; %OR -ARC@ 4= 06$#= su!ra note #4= at /9D/4

/0

See AnneGes of S>orn Statement of .ennis : Cunanan= %ebruary 06= 06$#

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1 & In t=e interest o< <air #laB

"ot>ithstanding the fact that Senators &uan Ponce *nrile= &inggoy *strada and Ramon 'Bong) Revilla issued their res!ective statements that they >ill refrain from !artici!ating in the Blue Ribbon Committee P.A% investigation=/, the Blue Ribbon Committee= in the interest of fair !lay= re1uested them to submit their res!ective !osition !a!ers and other relevant information to form !art of the records of the Committee= in relation to this !roceeding /# On -arch $0= 06$#= Senator *nrile manifested on the floor that he has instructed his staff to submit a co!y of his counterDaffidavit to the Committee= >hich he submitted earlier to the Office of the Ombudsman @o>ever= in a letter dated 0# -arch 06$#= Senator *nrile informed the Chairman of the Blue Ribbon Committee that he >ill no longer submit his counterDaffidavit to the Committee= as has been advised by his la>yers Senator *strada= in a letter dated $E -arch 06$# to the Chairman of the Committee= communicated that he sees no need to submit any document to the Committee Senator Revilla= on 06 -arch 06$# submitted the follo>ing? a) CounterDaffidavit dated $9 &anuary 06$# in O-BDCDCD$,D6,$4+ b) CounterDaffidavit dated $9 &anuary

/,

Blue Ribbon ;ranscri!t for August 0/= 06$,= su!ra note E= at $0+ &ournal of the Re!ublic of the Phili!!ines= Senate= Session "o ,#= "ovember E= 06$,= SiGteenth Congress= %irst Regular Session at E94+ -arvin Sy= ', senators inhibit as U!or3I !robe starts) ;he Phili!!ine Star= August 0/= 06$,= htt!?AA>>> !hilstar comAheadlinesA06$,A6CA0/A$$#4,C$A,DsenatorsDinhibitD!or3D!robeDstarts (last accessed -arch 0E= 06$#)
/#

In a letter sent by Blue Ribbon Chairman ;eofisto ';<) <uingona III= dated -arch $0= 06$#

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06$# in O-BDCDCD$,D6,/9+ and c) Com!laint dated $6 Se!tember 06$, in Civil Case no BC7D06$,D$/, 1 & ' Senator Ra;on GBongH Re@illa0 ,r Senator Revilla generally refutes any !artici!ation in the P.A% scam= and claims that his !artici!ation in the disbursement of the P.A% is 'regular and above board?)
a Plaintiff RevillaIs involvement andAor !artici!ation in the release of my P.A% starts and ends in >riting an endorsement letter to the Senate President and the Chairman of the Senate Committee on %inance for the !ro8ectsA!rograms >hich he has identified in the current <AA on a fiscal year+ b Plaintiff RevillaIs P.A% allocation is neither released nor given to him or to his office at any given time= but directly to the Im!lementing Agencies of his identified !ro8ectsA!rograms+ c ;he Im!lementing Agencies are the ones accountable for the government money+ and d It is the mandated duty of the Im!lementing Agencies to closely monitor and su!ervise the im!lementation and com!letion of P.A% !ro8ectsA!rograms and ensure the legitimacy of the "<Os >hich >ill carry out the intended !ro8ectA!rogram /9

As to the allegations that he identified s!ecific "<Os that >ould eGecute the P.A%Dfunded !ro8ectA!rogram= Senator Revilla argued?
Basically= under the <AA= all that I= as Senator= am mandated to do is to choose >hich area or service as !rovided in the menu my P.A% allocation should be used ;hat >as all I did? after identifying the area of service based on the menu >hich I for>arded to the Senate President and the Senate %inance Committee Chairman= I %i% not=ing else I %i% not %esignate or en%orse anB NGO in t=e use o< o<<i>e9s P$AF <un%s 65

/9

Ramon 'Bong) Revilla= &r = vs Benhur 2 :uy= et al = Civil Case "o BC7D06$,D$/,= Se!tember $6= 06$,= at 4

/4

CounterDAffidavit of Senator Ramon 'Bong) Revilla &r = in %ield Investigation Office v Ramon 'Bong) Revilla &r = et al = O-BDCDCD $,D6,/9= $9 &anuary 06$#= at ,4+ "ote? .efense of nonDendorsement of any "<O is also raised in the Counter DAffidavit of Senator Ramon 'Bong) Revilla= &r = >ith CounterDcharge for Plunder in "ational Bureau of Investigation= et al = v Senator Ramon 'Bong) Revilla= &r = et al = O-BDCDCD$,D 6,$4= $9 &anuary 06$#= at 09

Page 67 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32
/E

As to the com!laint/E filed by the %ield Investigation Office of the Office of the Ombudsman against Senator Revilla= he claims that ';here is absolutely nothing in the Com!laint= including its anneGes= evidencing my recei!t of any amount or even testimony of a >itness >ith !ersonal 3no>ledge that I benefited from the alleged illegal scheme )/C *ssentially= Senator RevillaIs defense is founded u!on the the follo>ing 8ustifications?
I An eGamination of the com!laint and its su!!orting documents reveal that my alleged involvement in the alleged misa!!ro!riation= malversation or misues of the P.A% is bereft of any factual basis because my signatures= and even those of Cambe=// as found in the P.A% documents= are forged ;he un>arranted reliance of the com!lainant on falsified documents in its attem!t to im!licate me in the crimes charged is fatal to the com!laint= and indubitably sho>s that the COA Re!ort is >rong and based on uncertain foundations II Contrary to the allegations in the com!laint= in so far as I am concerned= the availment and use of my officeIs P.A% allocation have al>ays been regular and aboveDboard Assuming that there had been irregularities in the use of such P.A% by other individuals I should not be held liable as my involvement in the P.A% released is limited and only in accordance >ith >hat >as then !rovided in the la> III Absent the documentary !roof in the form of P.A% documents= >hich have all been sho>n to contain forged signatures= and therefore void and totally lac3ing in evidentiary >eight= an eGamination of the com!laint and its su!!orting documents reveal that the com!laintIs viability no> only hinges on the affidavits submitted by the >histleblo>ers= >hich in themselves cannot 8ustify a finding of !robable cause

Com!laint dated $C "ovember 06$, in O-BDCDCD$,D6,/9 for Plunder under R A E6C6 and violation of N ,(e) of R A ,6$/

/C

Su!ra note /9= at 9

Atty Richard Cambe is identified as staff by Senator Revilla in the follo>ing submissions? a) CounterDaffidavit dated &anuary $9= 06$# in O-BDCDCD$,D6,$4+ b) CounterDaffidavit dated &anuary $9= 06$# in O-BDCDCD$,D6,/9+ and c) Com!laint dated Se!tember $6= 06$, in Civil Case no BC7D06$,D$/,

//

Page 68 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

I7 ;he absence of credible !roof and even believable allegations in the com!laint cannot 8ustify a finding of !robable cause that I committed= or cons!ired >ith the other res!ondents or any other !ersons to commit the crimes of !lunder= as defined and !enali(ed under Section 0= in relation to Section $ (d) of Re!ublic Act "o E6C6= and corru!t !ractices under Section ,(e) of Re!ublic Act "o ,$6/ In truth= the constitutive elements of the crimes charged are >anting and thus= the com!laint should be !erfunctorily dismissed $66

In >inding u! his counterDaffidavit= Senator Revilla stated that the com!lainant?

'failed establish= the eGistence of the crucial elements constituting the crimes ;he absence of such !roves that there is no !robable cause to charge me >ith the commission of the offense charged or any other crime for that matter the com!laint is anchored on either falsified documents or hearsay testimonies ;here is absolutely no evidence on record that >ould ma3e me liable for the crimes of Plunder and Corru!t Practices )$6$

;he Committee ac3no>ledges all !oints of contention in the submissions of Senator Revilla= and leaves it to the >isdom of the Office of the Ombudsman to determine their merit "evertheless= Senator RevillaIs submissions shall form !art of the CommitteeIs official records

/ FIN$INGS
;he CommitteeIs findings >ould sho> that there have been rec3less disregard of standard o!erating !rocedures= a cavalier violation of la>s= rules and regulations and other government issuances= and a systemic= endemic and orchestrated !illaging of the national treasury in the use of P.A%
$66

Su!ra note /9= at E= ,#= ,E and ,/

"ote? Similar defenses >ere raised in Counter DAffidavit o f Senator Ramon 'Bong) Revilla= &r >ith CounterDcharge for Plunder in "ational Bureau of Investigation= et al = v Senator Ramon 'Bong) Revilla= &r = et al = O-BDCDCD$,D6,$4= &anuary $9= 06$#= at 9= 0#
and 0E
$6$

Su!ra note /9= at 99D94

Page 69 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30

/ ' A?sen>e

o<

an

a##ro#riation

laC

or

or%inan>e

ear;arFing >ertain a;ounts to ?e s#e>i<i>allB >ontra>te% out to NGOs

*Gisting !rocurement !olicies allo> limited !artici!ation of "onD<overnment Organi(ations ("<Os) in governmentDfunded !ro8ects Resolution "o $0D066E of the <overnment Procurement Policy Board (<PPB) reads?
Se>tion 3/ Negotiate% Pro>ure;ent "egotiated Procurement is a method of !rocurement of goods= infrastructure !ro8ects= and consulting services= >hereby the !rocuring entity directly negotiates a contract >ith a technically= legally and financially ca!able su!!lier= contractor or consultant only in the follo>ing cases? MMM (8) Bhen an a!!ro!riation la> or ordinance earmar3s an amount to be s!ecifically contracted out to "onD<overnmental Organi(ations ("<Os)= the !rocuring entity may enter into a -emorandum of Agreement >ith an "<O= sub8ect to guidelines to be issued by the <PPB

;he rules re1uire that there be a la> or ordinance earmar3ing an amount of money s!ecifically contracted out to an "<O before the government agency may enter into a contract >ith said "<O A closer loo3 at the <eneral A!!ro!rations Acts of 066E= 066C and 066/ reveal identical !rovisions allo>ing "<O !artici!ation in government !ro8ects (<AA 066E Sec EC= <AA 066C Sec C6= <AA 066/ Sec C6)?
Ser@i>e Contra>ts .e!artments= bureaus= offices or agencies= as >ell as <OCCs= are hereby authori(ed to enter into service contracts= >ith other government agencies= !rivate firms or individuals and nonD governmental organi(ations for services related or incidental to their Page 70 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44

res!ective functions and o!erations= >hether on !artDtime or fullDtime basis Service contracts may be entered into by the agency for !rofessional consultancy services= >hich may include contracts >ith individual consultants %or this !ur!ose= an individual !rofessional consultant is an eG!ert in a field of s!ecial 3no>ledge or training >ho is contracted to render !articular out!uts or services !rimarily advisory in nature re1uiring highly s!eciali(ed or technical eG!ertise >hich cannot be !rovided by the regular staff of the agency Such hiring creates no em!loyerDem!loyee relationshi! bet>een the individual !rofessional consultant and the agency ;he .B-= in coordination >ith other agencies concerned= shall issue the necessary guidelines governing !rofessional consultancy services Service contracts may also be entered into by the agency for 8anitorial= security and other related services= >henever !racticable and costD effective for the government Service contracts shall be entered into by the agency through !ublic bidding or other alternative methods of !rocurement in accordance >ith R A "o /$C# and its Im!lementing Rules and Regulations= sub8ect to !ertinent accounting and auditing rules and regulations (*m!hasis

su!!lied)

In the 066E <AA= a ne> !rovision >as included= setting certain limitations in contracting "<Os for government !ro8ects?
Se> A3 Li;itations on Fun% Trans<ers to NGOs an% POs It is hereby declared a !olicy of the government not to allo> nonDgovernment organi(ations and !eo!leTs organi(ations to !artici!ate in the im!lementation of any !rogram or !ro8ect of the national and local government units until such time that any earlier fund releases availed of by the said nonDgovernment organi(ations and !eo!leTs organi(ations shall have been fully li1uidated !ursuant to !ertinent accounting and auditing rules and regulations= as certified by the head of the agency concerned and the COA auditor ;he government agency and local government units shall ensure that the nonDgovernment organi(ations and !eo!leTs organi(ations that they deal >ith are legitimate A re!ort on the fund releases indicating the names of nonDgovernment organi(ations and !eo!leTs organi(ations shall be !re!ared by the agency and duly audited by the COA and shall be submitted to the Senate Committee on %inance and the @ouse Committee on A!!ro!riations (*m!hasis su!!lied) Page 71 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

;he ne> !rovision states that the contracting government agency has the res!onsibility of chec3ing the legitimacy of the "<O and submitting financial re!orts to COA= the Senate and the @ouse of Re!resentatives %rom this investigation= >e observed that the failure to strictly com!ly >ith <PPB guidelines and the <AA allo>ed bogus "<Os to infiltrate the !rocurement system and ta3e money from the government= >ithout !roviding the services !romised It is clear that stronger controls are needed over "<Os >or3ing >ith !ublic funds ;hese !olicies should be given more !ermanence= through legislation= and not merely administrative issuances

/ 1 A?sen>e o< NGO a>>re%itation

In dealing >ith !ublic funds= there is a strict demand for trans!arency and !ro!er s!ending ;his includes "<Os that im!lement !ro8ects using !ublic funds ;he Commission on Audit= through COA Circular 066ED66$=$60 has laid do>n s!ecific re1uirements for "<Os or Peo!leIs Organi(ations (POs) that >ish to !artici!ate in !ubliclyDfunded !ro8ects ;he >histleblo>ers demonstrated that there >as a deliberate effort to ma3e the "<Os a!!ear legitimate by submitting falsified documents and re!orts ;hese !a!ers >ere acce!ted by the Im!lementing Agencies but there >as no meaningful effort to verify the legitimacy of these "<Os

$60

'Revised <uidelines in the granting= utili(ations= accounting and auditing of the funds released to "onD<overnmental Organi(ationsAPeo!leIs Organi(ations ("<OsAPOs)) Jhereinafter CO--ISIO" O" AH.I; CIRCH:AR 066ED66$K

Page 72 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22

According to the COA Circular= "<OsAPOs are accredited on a !erD!ro8ect= !erD agency basis through the s!ecific agencyIs Bids and A>ards Committee (BAC) *ach BAC is re1uired to screen each "<OAPOIs 1ualification documents= conduct ocular ins!ections of its business site and evaluate its financial and technical ca!acity Bhen investigated about these !rocesses= the Im!lementing Agencies clearly did not com!ly >ith these basic !reDa>ard duties ;his investigation sho>s that "<OsAPOs involved >ere not selected based on merit= but as a result of !olitical !atronage and falsified documents :egislators >ere able to eGert their influence in >hat should have been a !urely eGecutive matter ;his could have been avoided if the "<OsAPOs >ere thoroughly investigated andAor blac3listed before they could grab the o!!ortunity to steal !ublic funds

/ / A?sen>e o< a>>ounta?ilitB in t=e ;onitoring o< P$AF<un%e% #roDe>ts

*vidence sho>s that the unla>ful use of !ublic funds in these cases have been tolerated for several years management of !ublic funds Although COA >as able to detect the anomalies and re!ort about them= corrective measures are slo>= ineffective and late in coming ;here >as clearly failure of control on the !art of the Im!lementing Agencies and the .B- >ho >ere in the best !osition to !revent these anomalies ;he Im!lementing Agencies did not ta3e diligent efforts to study the "<Os they >ere dealing >ith before a>arding them >ith government contracts >orth millions of !esos
Page 73 of 122

;here >as a lac3 of res!onsible and accountable

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42
$6,

:i3e Pontius Pilate= the Im!lementing Agencies >ashed their hands of any res!onsibility over the im!lementation of the P.A%Dfinanced !ro8ects?
MS PULI$O-TAN Ayon !o sa mga im!lementing agencies= 3asi 3inunan din !o namin sila ng comments= management comments= 3aramihan !o sa sagot nila at na!a!aloob din !o ito= na3asaad sa amin !ong audit re!ort= >e almost lifted verbatim the letters of ":RC= ":.C even .SB. to as3 and saying= in effect= na either 'Bala 3aming intervention sa !ag!ili ng "<O=) na 'sinunod lang naming Uyung dire3tiba o instructions ng legislator ) MMM CHAIRMAN Sandali !o %orgive me for interru!ting So sinabi !o ng im!lementing agency na sinusundan lang !o nila Uyung instruction ng legislatorS MS PULI$O-TAN O!o MMM MS PULI$O-TAN O!o Ang sabi !o ng ;RC= for eGam!le= ';he centerIs intervention in the !ro8ects tended to be more recommendatory in nature ;he !ro8ects >ere endorsed by the s!onsoring legislators and in almost all cases= >e did not have a hand in selecting the "<O !artners ) Ang sabi !o nila= ';he "<Os >ere selected by s!onsoring legislators ) Ang sabi naman !o ng ":.C= 'Be can only rely on the certification issued by the offices of the legislator since they are the ones directly su!ervising !ro8ect im!lementation Be do not loo3 into the incor!orators of the "<OsD) CHAIRMAN *Gcuse me= maIam= eGcuse me .id you say that they are saying that the legislators are the ones im!lementingS MS PULI$O-TAN Ito !o Uyung sinabi ng ":.C !o CHAIRMAN O3ay MS PULI$O-TAN At sinabi rin !o ng ":.C= this is on !age 0C6 of our re!ort= 'Be do not loo3 into the incor!orators of the "<Os being endorsed by the legislators ) MMM
$6,

(*m!hasis su!!lied)

B:H* RIBBO" ;RA"SCRIP; %OR AH<HS; 0/= 06$,= su!ra note E= at 9ED9/

Page 74 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

;his Pontius Pilate !ractice of Im!lementing Agencies is reiterated in the follo>ing admission?
SEN P CA(ETANO -r Chair= on the !rocess of accrediting "<Os= may I as3 the t>o R the former President and current !resident of PR*C= >hat is the accreditation !rocessS Bell= youIve mentioned the S*C registration and the financial re!orts But in terms of 3no>ing the ca!acity of this "<O in delivering the services= do you chec3 on thatS Because they may have three years financial statements but not in delivering to one million beneficiaries= literally= house to house Bho chec3s thatS .o youS MR ,A)ELLANA -adam= these "<Os are endorsed to us by the la>ma3ers SEN P CA(ETANO So= you assume that the la>ma3er >ould 3no> of the "<OIs ca!ability to do the s!ecific !ro8ect MR ,A)ELLANA Qes SEN P CA(ETANO ;hat is your assum!tion MR ,A)ELLANA Qes= maIam
$6#

Some Im!lementing Agencies heads even claimed that they >ere tric3ed by the "<Os?
SEN A+UINO" -aybe as a final 1uestion= IId li3e to as3 our t>o former heads 2asi ho marami hong na3atingin ho sa atin= es!ecially the ones >ho are involved .ala>a lang !o 3asi ang na3i3ita 3ong !>edeng rea3syon *ither 3asama 3a o nalo3o 3a= diI baS *ither 3asama 3a= youIre com!licit and !robably thatIs >hat most !eo!le are thin3ing= even the legislators >ho are involved or 3asama 3a sa mga nalo3o "alo3o 3a And= indeed= you feel very bad as many of us feel bad that such money >as lost to corru!tionL Ang !a3iramdam rin ho ba ninyo R 3asi IIm not getting that from you right no> R ang !a3iramdam ho rin ba ninyo ay nalo3oS ;hat this should be sto!!ed and in fact= under your >atch= nalo3o rin 3ayo ng mga !e3eng "<O Qan ho ba yung !a3iramdam ninyo= Asec Salacu! and -r &avellanaS

$6#

B:H* RIBBO" ;RA"SCRIP; %OR S*P;*-B*R 9= 06$,= su!ra note 0$= at E0DE,

Page 75 of 122

MR SALACUP" Sir= yes= nalo3o !o SEN A+UINO" -r &avellana MR ,A)ELLANA" Qes= sir "alo3o rin 3ami= sir THE CHAIRMAN" "alo3o na $69 (*m!hasis su!!lied)

If these statements are true= then there >as rec3less negligence on the !art of the Im!lementing Agencies in managing !ublic funds If not= there may have been collusion and the !roblem could be attributable to corru!tion in government and the !oor 1ualifications of government officials

/ & A>>ounta?ilitB o< Legislators

1 2 3 4 5 6 7 8

"ot>ithstanding

the

Su!reme

Court

decision

declaring

the

P.A%

unconstitutional= there is value in laying do>n the observations made during this investigation regarding the management of !ublic funds by legislators ;here >ere fundamental failures in the handling of these funds %irst= the legislators allo>ed members of their staff to sign P.A% documents as official re!resentatives= and yet later denied 3no>ledge of the latterIs activities $64 Agents act in behalf of their !rinci!als or their office and their acts are considered acts of the !rinci!al
$69

$6E

;his can only be denied by the !rom!t action of the legislators

Id = at $$ED$$C
COA R*POR;= su!ra note $$= AnneG C of said Re!ort

$64

$6E

An Act to Ordain and Institute the Civil Code of the Phili!!ines JCI7I: CO.*K= Re!ublic Act "o ,C4= Boo3 III= ;itle II ($/96) reads?

Art $C4C By the contract of agency a !erson binds himself to render some service or to do something in re!resentation or on behalf of another= >ith the consent or authority of the latter Art $C4/ Agency may be eG!ress= or im!lied from the acts of the !rinci!al= from his silence or lac3 of action= or his failure to re!udiate the agency= 3no>ing that another !erson is acting on his behalf >ithout authority

Page 76 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32

denying or >ithholding the authority they su!!osedly granted to their res!ective agents In this case= there >as no denial or re!udiation Bhen the COA conducted an audit to confirm the signatures of the legislators and their agents= some legislators involved verified the signatures on the P.A% documents= >hile others did not res!ond at all
$6C

Bhile Benhur :uy admitted that there have been occasions >here &anet :imD "a!oles and her cohorts signed the names of certain legislators on !ertinent documents= the act >as committed >ith the !rior= voluntary= definite= and informed

consent of the legislators?

SEN ESCU$ERO "abanggit mo rin 3anina !ine!e3e Uyong mga !irma ng beneficiary Pine!e3e niyo rin ba ang !irma ng congressman at ng senador sa mga re1uestS MR LU( Ang nangyayari !o minsan !ag3a nag3ausa! na sila ni -s "a!oles= sasabihin ng senador na[sorry= IIm sorry R sasabihin !o ng 3ausa! niya na Rsasabihin !o 3asi na i!a!adala Uyong li1uidation So= !ini!irmahan naman !o nila Uyong li1uidation SEN ESCU$ERO Ang tanong 3o= finorge (forge) or may finor8 na ba 3ayong !irma ng senador o congressman dahil !ine!e3e nga Uyong beneficiary= Udi ba= galing sa listahan ng 3ung sino= finoDforge niyo rin ba o nag3aroon ba ng o3asyon na finorge (forge) ninyo ang !irma ng congressman o senador sa anumang do3umentoS MR LU( Bith the a!!roval of -s "a!oles 3asi sila !o ang nagDuusa!= may !ag3a3ataon !o na !inoDforge (forge) !o SEN ESCU$ERO -ay !ag3a3ataong !inoDforge niyo ang !irma ng mambabatasS MR LU( O!o

Agency may be oral= unless the la> re1uires a s!ecific form

$6C

COA R*POR;= su!ra note $$= AnneG C

Page 77 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36

SEN ESCU$ERO Pero ayon sa Uyo= base sa sinabi ni "a!oles= inD authori(e siya noIng mambabatas MR LU( O!o= !irmahan da> MMM MR LU( 2asi bago !o 3asi a3o !umaso3 duon na3i3ita 3o na yung ganoon ang gina>a nila so tinatanong 3o !o ba3it may ganyan So sabi naman ni -s "a!oles= ni -adam= inDauthori(e siya na !>ede na !irmahan= ta!os ang do3umento mag!aDfurnish[bibigyan sila ng 3o!ya ;a!os iaDac3no>ledge nila na talagang sila yun ang !umirma SEN ESCU$ERO So inaDac3no>ledge nila later onS MR LU( O!o= inaDac3no>ledge nila na alam ng mga R Ang !ag3a3aalam 3o 3asi ang sabi !o ng legislators na !ag3a!irma bigyan sila ng 3o!ya So mayroon naman !o silang 3o!ya noon at inaDac3no>ledge nila yung gina>a SEN ESCU$ERO InaDac3no>ledge nila 3aninoS MR LU( InaDac3no>ledge nila yung gina>a !ong R SEN ESCU$ERO Sa inyoS MR LU( O!o $6/ (*m!hasis su!!lied)

A !erson of ordinary diligence >ho discovers his or her agentIs illegal activities >ould have immediately informed the agencies involved to sto! the !ayment of funds and abort the !ro8ect ;he !rinci!al >ould then investigate and terminate the erring agent A !erson >ho fails to ta3e action >ithin reasonable time !robably directed the illegal activity or sim!ly tolerated it ;he !rinci!al either a!!roved the action of the agent or ratified it eventually In either case= the !rinci!al is legally bound by the acts of his or her agent

$6/

B:H* RIBBO" ;RA"SCRIP; %OR S*P;*-B*R $0= 06$,= su!ra note ,,= at $0/D$,$

Page 78 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19

Stronger controls are needed to hold legislators accountable for !ublic funds entrusted to their office ;hey must not be allo>ed to insulate themselves from blame or !rosecution by using agents as an eGcuse And even if >e assume= for the sa3e of argument= that the agents acted outside the sco!e of their authority= then there >as ineGcusable negligence on the !art of the legislator for entrusting a large amount of State funds to an incom!etent agent Second= the legislators endorsed Im!lementing Agencies and "<Os to im!lement P.A% !ro8ects and interfered >ith the discretion of the eGecutive offices Instead of sim!ly recommending !ro8ects and beneficiaries= there >as unnecessary interference by the legislator in the !rocess of im!lementation Im!lementing Agencies treated the endorsements as orders from a Usu!erior officer=I effectively overriding their o>n 8udgment and duties under the la> If these endorsements >ere not made= the Im!lementing Agencies might have been more diligent in selecting the "<Os involved ;hird= the legislators >ho admitted that it >as not their res!onsibility to chec3 the legitimacy of the "<Os >ere the ones >ho endorsed these bogus "<Os $$6 Accountability can only be achieved by offices that are able to efficiently and effectively manage= monitor and evaluate !ro8ects and their funding ;his P.A% Scam demonstrates to the !ublic that the legislators >ere either un>illing or unable to meet this obligation Bithout this accountability= they should not be the !ro!er offices to

$$6 Ayee -acaraig= *nrile bloc? "ot our 8ob to chec3 "<Os= available at htt!?AA>>> ra!!ler comAnationA,C$$4DsenateDminorityDblocD !or3Dngos (last accessed -arch 0E= 06$#)

Page 79 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17

recommend such !ro8ects in the first !lace ;he foremost tas3 of a legislator is to ma3e la>s and not to im!lement government !ro8ects

/ 3 NGO Parti>i#ation in Go@ern;ent ProDe>ts

;he <overnment Procurement Reform Act (R A "o /$C#) allo>s !rivate

individuals and grou!s to ta3e !art in government !ro8ects as su!!liers= contractors or consultants?
Section #C (e) Negotiate% Pro>ure;ent D a method of Procurement that may be resorted under the eGtraordinary circumstances !rovided for in Section 9, of this Act and other instances that shall be s!ecified in the IRR= >hereby the Procuring *ntity directly negotiates a contract >ith a technically= legally and financially ca!able su!!lier= contractor or consultant

Such !artici!ation re1uires the !rivate individual or grou! to be technically= legally and financially ca!able ;hese ca!abilities must be tested by the Procuring Agency through its Bids and A>ards Committee (BAC) $$$ ;his !rocess is frustrated >hen an outside force (e g legislator) eGerts !ressure and endorses the "<OAPO= of his

$$$

An Act Providing for the -oderni(ation= Standardi(ation and Regulation of the Procurement Activities of the <overnment and for Other Pur!oses J<O7*R"-*"; PROCHR*-*"; R*%OR- AC;K= Re!ublic Act "o /$C# (066,)= N $0 reads? Section $0 %unctions of the BAC D shall have the follo>ing functions? advertise andAor !ost the invitation to bid= conduct !reD!rocurement and !reDbid conferences= determine the eligibility of !ros!ective bidders= receive bids= conduct the evaluation of bids= underta3e !ostD1ualification !roceedings= recommend a>ard of contracts to the @ead of the Procuring *ntity of his duly authori(ed re!resentative? Provided= ;hat in the event the @ead of the Procuring shall disa!!rove such recommendation= such disa!!roval shall be based only on valid= reasonable and 8ustifiable grounds to be eG!ressed in >riting= co!y furnished the BAC+ recommend the im!osition of sanctions in accordance >ith Article MMIII= and !erform such other related functions as may be necessary= including the creation of a ;echnical Bor3ing <rou! from a !ool of technical= financial andAor legal eG!erts to assist in the !rocurement !rocess In !ro!er cases= the BAC shall also recommend to the @ead of the Procuring *ntity the use of Alternative -ethods of Procurement as !rovided for in Article M7I hereof ;he BAC shall be res!onsible for ensuring that the Procuring *ntity abides by the standards set forth by this Act and the IRR= and it shall !re!are a !rocurement monitoring re!ort that shall be a!!roved and submitted by the @ead of the Procuring *ntity to the <PPB on a semestral basis ;he contents and coverage of this re!ort shall be !rovided in the IRR (em!hasis su!!lied)

Page 80 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14

or her choice= for a !articular !ro8ect ;he !rocuring agency faces either the threat of !unishment or the !romise of re>ard+ thereby= corru!ting the !rocess of !rocurement "<OsAPOs are not the !roblem ;hey are sim!ly vehicles that may be used for tremendous good or terrible evil Once again= the solution lies >ith stricter controls through accreditation= monitoring and evaluation Remedies should also be s>ift and decisive Bhen !ersons or grou!s are found to be illegitimate= they should be immediately !rosecuted and blac3listed from entering into future government !ro8ects <rou!s li3e these should be chec3ed for interloc3ing trustees= directors or members to !revent fraud

/ 5 A>>ounta?ilitB o< Pri@ate Persons

Hnder the <overnment Procurement Reform Act=$$0 the Plunder :a>=$$, and the

AntiD<raft and Corru!t Practices Act=$$# !rivate !ersons that !artici!ate in the crimes of
!ublic officers are similarly liable

$$0

Id = N 49 reads?
Section 49 Offenses and Penalties D (a) Bithout !re8udice to the !rovisions of Re!ublic Act "o ,6$/= other>ise 3no>n as the YAntiD<raft and Corru!t Practice ActY and other !enal la>s= !ublic officers >ho commit any of the follo>ing acts shall suffer the !enalty of im!risonment of not less than siG (4) years and one ($) day= but not more than fifteen ($9) years? $ O!en any sealed Bid including but not limited to Bids that may have been submitted through the electronic system and any and all documents re1uired to be sealed or divulging their contents= !rior to the a!!ointed time for the !ublic o!ening of Bids or other documents 0 .elaying= >ithout 8ustifiable cause= the screening for eligibility= o!ening of bids= evaluation and !ost evaluation of bids= and a>arding of contracts beyond the !rescribed !eriods of Bids or other documents , Hnduly influencing or eGerting undue !ressure on any member of the BAC or any officer or em!loyee of the !rocuring entity to ta3e a !articular bidder # S!litting of contracts >hich eGceed !rocedural !urchase limits and com!etitive bidding

9 Bhen the head of the agency abuses the eGercise of his !o>er to re8ect any and all bids as mentioned under Section #$ of this Act >ith manifest !reference to any bidder >ho is closely related to him in accordance >ith Section #E of this Act

Page 81 of 122

Bhen any of the foregoing acts is done in collusion >ith !rivate individuals= the !rivate individuals shall li3e>ise be liable for the offense In addition= the !ublic officer involved shall also suffer the !enalty of tem!orary dis1ualification from !ublic office= >hile the !rivate individual shall be !ermanently dis1ualified from transacting business >ith the government (b) Private individuals >ho commit any of the follo>ing acts= including any !ublic officer= >ho cons!ires >ith them= shall suffer the !enalty of im!risonment of not less than siG (4) years and one ($) day but not more than fifteen ($9) years? $ Bhen t>o or more bidders agree and submit different Bids as if they >ere bona fide= >hen they 3ne> that one or more of them >as so much higher than the other that it could not be honestly acce!ted and that the contract >ill surely be a>arded to the !reDarranged lo>est Bid 0 Bhen a bidder maliciously submits different Bids through t>o or more !ersons= cor!orations= !artnershi!s or any other business entity in >hich he has interest of create the a!!earance of com!etition that does not in fact eGist so as to be ad8udged as the >inning bidder , Bhen t>o or more bidders enter into an agreement >hich call u!on one to refrain from bidding for Procurement contracts= or >hich call for >ithdra>al of bids already submitted= or >hich are other>ise intended to secure as undue advantage to any one of them # Bhen a bidder= by himself or in connivance >ith others= em!loy schemes >hich tend to restrain the natural rivalry of the !arties or o!erates to stifle or su!!ress com!etition and thus !roduce a result disadvantageous to the !ublic In addition= the !ersons involved shall also suffer the !enalty of tem!orary or !er!etual dis1ualification from !ublic office and be !ermanently dis1ualified from transacting business >ith the government (c) Private individuals >ho commit any of the follo>ing acts= and any !ublic officer cons!iring >ith them= shall suffer the !enalty of im!risonment of not less than siG (4) years and one ($) day but more than fifteen ($9) years? $ Submit eligibility re1uirements of >hatever 3ind and nature that contain false information or falsified documents calculated to influence the outcome of the eligibility screening !rocess or conceal such information in the eligibility re1uirements >hen the information >ill lead to a declaration of ineligibility from !artici!ating in !ublic bidding 0 Submit Bidding .ocuments of >hatever 3ind and nature than contain false information or falsified documents or conceal such information in the Bidding .ocuments= in order to influence the outcome of the !ublic bidding , Partici!ate in a !ublic bidding using the name of another or allo> another to use oneTs name for the !ur!ose of !artici!ating in a !ublic bidding # Bithdra> a Bid= after it shall have 1ualified as the :o>est Calculated BidA@ighest Rated Bid= or to acce!t and a>ard= >ithout 8ust cause or for the !ur!ose of forcing the Procuring *ntity to a>ard the contract to another bidder ;his shall include the nonDsubmission of re1uirements such as= but not limited to= !erformance security= !re!aratory to the final a>ard of the contract (d) Bhen the bidder is a 8uridical entity= criminal liability and the accessory !enalties shall be im!osed on its directors= officers or em!loyees >ho actually commit any of the foregoing acts
$$,

An Act .efining and Penali(ing the Act of Plunder Jhereinafter P:H".*R :ABK= Re!ublic Act "o E6C6 ($//$)= N 0 reads? Sec 0 .efinition of the Crime of Plunder+ Penalties D Any !ublic officer >ho= by himself or in connivance >ith members of his family= relatives by affinity or consanguinity= business associates= subordinates or other !ersons= amasses= accumulates or ac1uires illDgotten >ealth through a combination or series of overt criminal acts as described in Section $ (d) hereof in the aggregate amount or total value of at least %ifty million !esos (P96=666=666 66) shall be guilty of the crime of !lunder and shall be !unished by reclusion !er!etua to death Any !erson >ho !artici!ated >ith the said !ublic officer in the commission of an offense contributing to the crime of !lunder shall li3e>ise be !unished for such offense In the im!osition of !enalties= the degree of

Page 82 of 122

1 2 3 4 5 6 7 8 9 10 11

In these cases= &anet :imD"a!oles= together >ith her em!loyees and agents= formed !art of a grand cons!iracy to defraud the Phili!!ine government of !ublic funds ;hey are sub8ect to criminal !enalties= forfeiture of illDgotten >ealth and dis1ualification from entering into future contracts >ith the government

/ A Certain legislators =a@e >o;;itte% a ?rea>= o< %utB to t=e #u?li>

As the P.A% scam >ould sho>= certain legislators failed to fulfill the mandate entrusted to them by the electorate As !ublic officers= they are re1uired to meet eGacting standards of trans!arency and accountability ;he minimum standard of due diligence= that could have been follo>ed by the legislators= is to at least verify the legitimacy of the "<Os D >hich these legislators vigorously and consistently endorsed as

!artici!ation and the attendance of mitigating and eGtenuating circumstances= as !rovided by the Revised Penal Code= shall be considered by the court ;he court shall declare any and all illDgotten >ealth and their interests and other incomes and assets including the !ro!erties and shares of stoc3s derived from the de!osit or investment thereof forfeited in favor of the State
$$#

AntiD<raft and Corru!t Practices Act= Re!ublic Act "o ,6$/ ($/46)= N # reads? Section # Prohibition on !rivate individuals (a) It shall be unla>ful for any !erson having family or close !ersonal relation >ith any !ublic official to ca!itali(e or eG!loit or ta3e advantage of such family or close !ersonal relation by directly or indirectly re1uesting or receiving any !resent= gift or material or !ecuniary advantage from any other !erson having some business= transaction= a!!lication= re1uest or contract >ith the government= in >hich such !ublic official has to intervene %amily relation shall include the s!ouse or relatives by consanguinity or affinity in the third civil degree ;he >ord Yclose !ersonal relationY shall include close !ersonal friendshi!= social and fraternal connections= and !rofessional em!loyment all giving rise to intimacy >hich assures free access to such !ublic officer (b) It shall be unla>ful for any !erson 3no>ingly to induce or cause any !ublic official to commit any of the offenses defined in Section , hereof ;he !erson giving the gift= !resent= share= !ercentage or benefit referred to in sub!aragra!hs (b) and (c)+ or offering or giving to the !ublic officer the em!loyment mentioned in sub!aragra!h (d)+ or urging the divulging or untimely release of the confidential information referred to in sub!aragra!h (3) of this section shall= together >ith the offending !ublic officer= be !unished under Section nine of this Act and shall be !ermanently or tem!orarily dis1ualified in the discretion of the Court= from transacting business in any form >ith the <overnment

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

reci!ients of the P.A% ;his glaring act of carelessness= be it deliberate or not= made !ossible such "<Os to be utili(ed as instruments of a grandDscale misa!!ro!riation of the P.A% ;he $/CE Phili!!ine Constitution underscores the im!ortance of the !rinci!le that '!ublic office is a !ublic trust ) 'Public officers and em!loyees must= at all times= be accountable to the !eo!le= serve them >ith utmost res!onsibility= integrity= loyalty= and efficiency+ act >ith !atriotism and 8ustice= and lead modest lives )$$9 ;hese constitutionallyDenshrined !rinci!les= oftDre!eated in our case la>= are not mere rhetorical flourishes or idealistic sentiments ;hey should be ta3en as >or3ing standards by all in the !ublic service
$$4

;he disbursement of millions u!on millions of taG!ayersI money is imbued >ith !ublic interest %ailure to verify the legitimacy of these "<Os is no less than a breach of duty to the !ublic

/ O Cir>u;stan>es su>= as <lig=t an% ?are<a>e% %enials ?elie t=e assertion o< inno>en>e
At the outset= let it be em!hasi(ed that the investigation of the Blue Ribbon into the P.A% Scam is not a3in to the !roceedings of a court of la> ;he Blue RibbonIs mandate is to conduct hearings= in aid of legislation= on malfeasance= misfeasance or nonfeasance in government+ and it is in no >ay considered a venue to determine the guilt or innocence of those >ho are the alleged !er!etrators of the Scam
$$9

P@I: CO"S; art MI N $ .u1ue v 7eloso= < R "o $/406$ (06$0)

$$4

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29
$$E

Bhile the Blue Ribbon is no 8udge or 8ury= it still ta3es into account evidentiary circumstances in recommending its findings for !rosecution ;he flight and barefaced denials of some of those !ur!ortedly involved in the Scam contradict their claim of innocence %leeing after being accused of a crime suggests cul!ability
&uris!rudence has re!eatedly declared that flight is an indication of guilt ;he flight of an accused= in the absence of a credible eG!lanation= >ould be a circumstance from >hich an inference of guilt may be established Tfor a truly innocent !erson >ould normally gras! the first available o!!ortunity to defend himself and to assert his innocence $$E (*m!hasis

su!!lied)

@uman eG!erience and logic dictate that an innocent !erson >ould have stayed to ans>er the charges against himAher *vading 8ustice denotes blame or at least= a guilty conscience Some government officials and !rivate individuals summoned by the

Committee >ere unable to a!!ear before it Immigration data and ne>s re!orts revealed that some of them even eGited the country ;his may be inter!reted by the court as indicators of guilt if no genuine eG!lanation is later on !rovided Another indication of guilt is denial .enial to eGonerate onself from a charge of >rongdoing hardly >arrants any merit= as it is merely selfDserving and easy to do
.enial is an inherently >ea3 defense and has al>ays been vie>ed u!on >ith disfavor by the courts due to the ease >ith >hich it can be concocted .enial as a defense crumbles in the light of !ositive identification of the accused= as in this case ;he defense of denial assumes significance only >hen the !rosecutionIs evidence is such that it does not !rove guilt beyond reasonable doubt 7erily= mere denial= unsubstantiated by clear and convincing evidence= is negative selfDserving evidence >hich cannot be given greater evidentiary >eight than the
<an v Phili!!ines= < R "o $49CC# (066E)+ Peo!le v .ia(= < R "o $,,E,E (066,) citing Peo!le v .el -undo= < R "o $,C/0/ (066$)+ Peo!le v Cueto < R "o $#EE4# (066,) citing Peo!le v Andarme= < R "o $#6#04 (0660)

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21
$$C

testimony of the com!laining >itness >ho testified on affirmative matters $$C (*m!hasis su!!lied)

Outright denial= >hen 8uGta!osed >ith !ositive and detailed assertions= further >ea3ens as a mode of defense ;his >as !articularly clear >hen -rs "a!oles >as as3ed to testify before the Committee She eG!ressed one denial after another >hile the >histleblo>ers stood by their detailed s>orn statements and records In >eighing the credibility of t>o o!!osing claims= 8uris!rudence and common human eG!erience favor !ositive statements over denials
$$/

;he Blue Ribbon Committee ta3es cogni(ance of these incriminatory circumstances in ma3ing its recommendations

Peo!le v -onticalvo= < R "o $/,96E (06$,)

Peo!le v .aramay= < R "os $#60,9 F $#0E#C (0660) citing Peo!le v Acabo+ 09/ SCRA E9= &uly $E= $//4+ Peo!le v Pere(= 0E6 SCRA 904= -arch 04= $//E+ Peo!le v ;ravero= 0E4 SCRA ,6$= &uly 0C= $//E+ Peo!le v *rese= 0C$ SCRA ,$4= "ovember 9= $//E+ Peo!le v Pontilar &r = 0E9 SCRA ,,C= &uly $$= $//E

$$/

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22

& RECOMMEN$ATIONS
;he P.A% Scam trains the s!otlight on dee! crac3s in government that >ea3en its foundations and continue to erode !ublic faith in government Bith the follo>ing recommendations= the Blue Ribbon Committee aims to reinforce the !illars that 3ee! the government standing By addressing the issues on !revention= criminali(ation= trans!arency= accountability= good governance= and asset recovery= this Re!ort see3s to restore and !romote !ublic trust in our !ublic institutions

& ' Prose>ution

;he Committee ta3es notice of= and gives its full su!!ort to= the concurrent >or3 being done by the .e!artment of &ustice (.O&)= the Commission on Audit (COA)= the Office of the Ombudsman= and the AntiD-oney :aundering Council (A-:C) in investigating this P.A% Scam Indeed= much of the information !rovided to this Committee >as because of the coo!eration of these inde!endent government agencies ;he Committee recogni(es that the .O&= COA= A-:C and the Ombudsman have more evidence in their !ossession and= therefore= >ill have a better chance of !robing these cases even more dee!ly= for !ur!oses of !rosecution ;he com!lete list of cul!able !ersons= and the eGtent of their !artici!ation= >ill be more !ro!erly determined by these agencies On the other hand= this Committee >ishes to !rovide its o>n observations >ith the end in vie> of !olicy and la> reform

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1 2 3

In su!!ort of the findings of other investigative bodies= the Committee finds merit in the evidence !resented and finds sufficient basis for the filing of a!!ro!riate criminal cases >ith the !ro!er court? Persons lia?le Sen &uan Ponce *nrile and his agent= &essica '<igi) Reyes LaCs @iolate% Plunder i or -alversation $ ii (de!ending on amount) 0 .irect bribery iii %rauds against the !ublic treasury and similar offenses iv 7iolating the AntiD<raft and Corru!t Practices , Act v 7iolating the Code of Conduct and *thical Standards for Public Officials and *m!loyeesvi Co;;ents Sen *nrile designates Reyes and *vangelista to act in his behalf+vii Hnder *nrileIs authority= the agents !re!ared and signed official P.A% documents and dealt >ith "a!oles and her agents viii Bhistleblo>ers :uy and Su5as testified that *nrile and his agents did business >ith "a!oles and received 3ic3bac3s of at least P,4,=0E9=666 for allo>ing her to access the P.A% iG ;uason similarly testified about bro3ering deals bet>een "a!oles and *nrileIs office and !ersonally delivering money from "a!oles to Sen *nrileIs chief of staff G Sen *strada designates :abayen to act in his behalf+ Gi Hnder *stradaIs authority= his agent !re!ared and signed official P.A% documents and dealt >ith "a!oles and her agents Gii Bhistleblo>ers :uy and
Page 88 of 122

0 ,

Sen &inggoy *8ercito *strada and his agent= Pauline :abayen+

$ Plunder or -alversation (de!ending on amount) 0 .irect bribery , %rauds against the !ublic treasury and similar offenses # 7iolating the AntiD<raft and Corru!t Practices Act 9 7iolating the Code of

Persons lia?le

LaCs @iolate% Conduct and *thical Standards for Public Officials and *m!loyees

Sen Ramon YBongY B Revilla= &r and his agent= Richard Cambe+

$ Plunder or -alversation (de!ending on amount) 0 .irect bribery , %rauds against the !ublic treasury and similar offenses # 7iolating the AntiD<raft and Corru!t Practices Act 9 7iolating the Code of Conduct and *thical Standards for Public Officials and *m!loyees

Allan &avellana of the $ Plunder or -alversation "ational Agribusiness (de!ending on amount) Cor!oration ("ABCOR) 0 .irect bribery , %rauds against the !ublic treasury and similar offenses # 7iolating the AntiD<raft and Corru!t Practices Act 9 7iolating the

Co;;ents Su5as testified that *strada and his agents did business >ith "a!oles and received 3ic3bac3s of at least P,E9=E96=666 for allo>ing her to access the P.A% Giii ;uason similarly testified about bro3ering deals bet>een "a!oles and *strada and !ersonally handing him money from "a!oles Giv $ Sen Revilla designates Cambe to act in his behalf+Gv 0 Hnder RevillaIs authority= his agent !re!ared and signed official P.A% documents and dealt >ith "a!oles and her agents Gvi , Bhistleblo>ers :uy and Su5as testified that Revilla and his agents did business >ith "a!oles and received 3ic3bac3s of at least P,04=666=666 for allo>ing her to access the P.A% Gvii &avellana and other officials of "ABCOR through connivance >ith the legislators= or through ineGcusable negligence= made it !ossible for government funds to be released to bogus "<Os through contracts or transactions that >ere
Page 89 of 122

Persons lia?le

Antonio Orti( (%ormer $ .irector <eneral) of the ;echnology Resource 0 Center (;RC) ,

&anet :imD"a!oles

$ 0 ,

LaCs @iolate% Co;;ents <overnment manifestly and grossly Procurement Reform Act disadvantageous to the Gviii government GiG 7iolating the Code of Conduct and *thical ;hey served as facilitators Standards for Public of the P.A% scam Officials and *m!loyees ;he >histleblo>ers testified that these government officials >ere !aid a share from the P.A% channeled through their agencies= in order to facilitate the !rocess GG Plunder or -alversation Orti( and other officials of (de!ending on amount) ;RC through connivance .irect bribery >ith the legislators= or by %rauds against the ineGcusable negligence= !ublic treasury and made it !ossible for similar offenses government funds to be 7iolating the AntiD<raft released to bogus "<Os and Corru!t Practices through contracts or Act transactions that >ere 7iolating the manifestly and grossly <overnment disadvantageous to the Procurement Reform Act government GGi 7iolating the Code of Conduct and *thical ;hey served as facilitators Standards for Public of the P.A% scam Officials and *m!loyees (R A "o 4E$,) ;he >histleblo>ers testified that these government officials >ere !aid a share from the P.A% channeled through their agencies= in order to facilitate the !rocess GGii Plunder or -alversation "a!oles is a coDcons!irator (de!ending on amount) for the crime of Plunder Corru!tion of Public because of her vital role as Officials the 'mastermind) of the %rauds against the entire o!eration GGiv
Page 90 of 122

Persons lia?le

LaCs @iolate% !ublic treasury and similar offenses # 7iolating the AntiD<raft and Corru!t Practices Act 9 %alse ;estimony GGiii (for &anet "a!oles)

Co;;ents ;ogether >ith her are some of her em!loyees that >ere designated as !residents of the bogus "<Os res!onsible for entering into the P.A%Dfunded government contracts involved in this investigation GGv All in all= "a!oles and her grou! orchestrated a scam that de!rived the %ili!ino !eo!le of millions of !esos in !ublic funds ;heir individual and collective acts constitute violations of the Revised Penal Code and other s!ecial criminal la>s In addition to the P.A% scam activities= "a!oles must also be !rosecuted for giving inconsistent or false statements under oath >hen she a!!eared before the Senate Blue Ribbon Committee on "ovember E= 06$, GGvi

Su!ra note $$,

An Act Revising the Penal Code and Other Penal :a>s JR*7IS*. P*"A: CO.*K= Act "o ,C$9 ($/,0)= art 0$E reads? Art 0$E -alversation of !ublic funds or !ro!erty+ Presum!tion of malversation [ Any !ublic officer >ho= by reason of the duties of his office= is accountable for !ublic funds or !ro!erty= shall a!!ro!riate the same or shall ta3e or misa!!ro!riate or shall consent= through abandonment or negligence= shall !ermit any other !erson to ta3e such !ublic funds= or !ro!erty= >holly or !artially= or shall other>ise be guilty of the misa!!ro!riation or malversation of such funds or !ro!erty= shall suffer? $ 0 ;he !enalty of !risi\n correccional in its medium and maGimum !eriods= if the amount involved in the misa!!ro!riation or malversation does not eGceed t>o hundred !esos ;he !enalty of !risi\n mayor in its minimum and medium !eriods= if the amount involved is more than t>o hundred !esos but does not eGceed siG thousand !esos

ii

Page 91 of 122

, #

;he !enalty of !risi\n mayor in its maGimum !eriod to reclusi\n tem!oral in its minimum !eriod= if the amount involved is more than siG thousand !esos but is less than t>elve thousand !esos ;he !enalty of reclusi\n tem!oral= in its medium and maGimum !eriods= if the amount involved is more than t>elve thousand !esos but is less than t>entyDt>o thousand !esos If the amount eGceeds the latter= the !enalty shall be reclusi\n tem!oral in its maGimum !eriod to reclusi\n !er!etua

In all cases= !ersons guilty of malversation shall also suffer the !enalty of !er!etual s!ecial dis1ualification and a fine e1ual to the amount of the funds malversed or e1ual to the total value of the !ro!erty embe((led ;he failure of a !ublic officer to have duly forthcoming any !ublic funds or !ro!erty >ith >hich he is chargeable= u!on demand by any duly authori(ed officer= shall be !rima facie evidence that he has !ut such missing funds or !ro!erty to !ersonal use (As amended by R A "o $646)
iii

Id = art 0$6 reads?

Art 0$6 .irect bribery [ Any !ublic officer >ho shall agree to !erform an act constituting a crime= in connection >ith the !erformance of this official duties= in consideration of any offer= !romise= gift or !resent received by such officer= !ersonally or through the mediation of another= shall suffer the !enalty of !rision mayor in its medium and maGimum !eriods and a fine Jof not less than the value of the gift andK not less than three times the value of the gift in addition to the !enalty corres!onding to the crime agreed u!on= if the same shall have been committed If the gift >as acce!ted by the officer in consideration of the eGecution of an act >hich does not constitute a crime= and the officer eGecuted said act= he shall suffer the same !enalty !rovided in the !receding !aragra!h+ and if said act shall not have been accom!lished= the officer shall suffer the !enalties of !rision correccional= in its medium !eriod and a fine of not less than t>ice the value of such gift If the ob8ect for >hich the gift >as received or !romised >as to ma3e the !ublic officer refrain from doing something >hich it >as his official duty to do= he shall suffer the !enalties of !rision correccional in its maGimum !eriod and a fine Jof not less than the value of the gift andK not less than three times the value of such gift In addition to the !enalties !rovided in the !receding !aragra!hs= the cul!rit shall suffer the !enalty of s!ecial tem!orary dis1ualification ;he !rovisions contained in the !receding !aragra!hs shall be made a!!licable to assessors= arbitrators= a!!raisal and claim commissioners= eG!erts or any other !ersons !erforming !ublic duties

iv

R*7IS*. P*"A: CO.*= su!ra note ii= art 0$, reads? Art 0$, %rauds against the !ublic treasury and similar offenses [ ;he !enalty of !rision correccional in its medium !eriod to !rision mayor in its minimum !eriod= or a fine ranging from 066 to $6=666 !esos= or both= shall be im!osed u!on any !ublic officer >ho? $ In his official ca!acity= in dealing >ith any !erson >ith regard to furnishing su!!lies= the ma3ing of contracts= or the ad8ustment or settlement of accounts relating to !ublic !ro!erty or funds= shall enter into an agreement >ith any interested !arty or s!eculator or ma3e use of any other scheme= to defraud the <overnment+ GGG

AntiD<raft and Corru!t Practices Act= su!ra note $$#= N, reads? Section , Corru!t !ractices of !ublic officers In addition to acts or omissions of !ublic officers already !enali(ed by eGisting la>= the follo>ing shall constitute corru!t !ractices of any !ublic officer and are hereby declared to be unla>ful? (a) Persuading= inducing or influencing another !ublic officer to !erform an act constituting a violation of rules and regulations duly !romulgated by com!etent authority or an offense in connection >ith the official duties of the latter= or allo>ing himself to be !ersuaded= induced= or influenced to commit such violation or offense

Page 92 of 122

(b) .irectly or indirectly re1uesting or receiving any gift= !resent= share= !ercentage= or benefit= for himself or for any other !erson= in connection >ith any contract or transaction bet>een the <overnment and any other !art= >herein the !ublic officer in his official ca!acity has to intervene under the la> GGG (e) Causing any undue in8ury to any !arty= including the <overnment= or giving any !rivate !arty any un>arranted benefits= advantage or !reference in the discharge of his official administrative or 8udicial functions through manifest !artiality= evident bad faith or gross ineGcusable negligence ;his !rovision shall a!!ly to officers and em!loyees of offices or government cor!orations charged >ith the grant of licenses or !ermits or other concessions GGG (g) *ntering= on behalf of the <overnment= into any contract or transaction manifestly and grossly disadvantageous to the same= >hether or not the !ublic officer !rofited or >ill !rofit thereby GGG (8) 2no>ingly a!!roving or granting any license= !ermit= !rivilege or benefit in favor of any !erson not 1ualified for or not legally entitled to such license= !ermit= !rivilege or advantage= or of a mere re!resentative or dummy of one >ho is not so 1ualified or entitled

An Act *stablishing a Code of Conduct and *thical Standards for Public Officials and *m!loyees= to H!hold the ;imeD@onored Princi!le of Public Office Being a Public ;rust= <ranting Incentives and Re>ards for *Gem!lary Service= *nurmerating Prohibited Acts and ;ransactions and Providing Penalties for 7iolations ;hereof and for Other Pur!oses JCO.* O% CO".HC; A". *;@ICA: S;A".AR.S %OR PHB:IC O%%ICIA:S A". *-P:OQ**SK= Re!ublic Act "o 4E$, ($/C/)= NE reads? Section E Prohibited Acts and ;ransactions D In addition to acts and omissions of !ublic officials and em!loyees no> !rescribed in the Constitution and eGisting la>s= the follo>ing shall constitute !rohibited acts and transactions of any !ublic official and em!loyee and are hereby declared to be unla>ful? (a) %inancial and material interest D Public officials and em!loyees shall not= directly or indirectly= have any financial or material interest in any transaction re1uiring the a!!roval of their office GGG (d) Solicitation or acce!tance of gifts D Public officials and em!loyees shall not solicit or acce!t= directly or indirectly= any gift= gratuity= favor= entertainment= loan or anything of monetary value from any !erson in the course of their official duties or in connection >ith any o!eration being regulated by= or any transaction >hich may be affected by the functions of their office
vii

vi

COA R*POR;= su!ra note $$= at AnneG C

viii

Id ? Sen *nrile confirmed to have authori(ed his chief of staff to sign in his behalf Pinagsamang Sinum!aang Salaysay ni Benhur :uy= -erlina SuZas= et al = Se!tember $$= 06$,= !ar E

iG

Su!ra note E4

Gi

Pinagsamang Sinum!aang Salaysay ni Benhur :uy= -erlina SuZas= et al = Se!tember $$= 06$,= !ar E? ;he >histleblo>ers identify Sen *strada as one of the legislators >ho transacted >ith "a!oles either directly or through his re!resentative= Pauline :abayen
Gii

Id Id Su!ra note E,

Giii

Giv

Page 93 of 122

Gv

COA R*POR;= su!ra note $6= AnneG C? Sen Revilla confirmed his signatures and that of his authori(ed re!resentative

Gvi

Id Su!ra note CC Su!ra note $$$

COA R*POR;= su!ra note $$= at #4D#C

Gvii

Gviii

GiG

GG

Su!ra note C,
COA R*POR;= su!ra note $$= at #4D#C

GGi

GGii

Su!ra note C,
R*7IS*. P*"A: CO.*= su!ra note ii= art $C, reads? Art $C, %alse testimony in other cases and !er8ury in solemn affirmation ;he !enalty of arresto mayor in its maGimum !eriod to !rision correccional in its minimum !eriod shall be im!osed u!on any !erson= >ho 3no>ingly ma3es untruthful statements and not being included in the !rovisions of the neGt !receding articles= shall testify under oath= or ma3e an affidavit= u!on any material matter before a com!etent !erson authori(ed to administer an oath in cases in >hich the la> so re1uires

GGiii

GGiv

P:H".*R :AB= su!ra note $$,= N# reads? Section # Prohibition on !rivate individuals (a) It shall be unla>ful for any !erson having family or close !ersonal relation >ith any !ublic official to ca!itali(e or eG!loit or ta3e advantage of such family or close !ersonal relation by directly or indirectly re1uesting or receiving any !resent= gift or material or !ecuniary advantage from any other !erson having some business= transaction= a!!lication= re1uest or contract >ith the government= in >hich such !ublic official has to intervene %amily relation shall include the s!ouse or relatives by consanguinity or affinity in the third civil degree ;he >ord Yclose !ersonal relationY shall include close !ersonal friendshi!= social and fraternal connections= and !rofessional em!loyment all giving rise to intimacy >hich assures free access to such !ublic officer (b) It shall be unla>ful for any !erson 3no>ingly to induce or cause any !ublic official to commit any of the offenses defined in Section , hereof ;he !erson giving the gift= !resent= share= !ercentage or benefit referred to in sub!aragra!hs (b) and (c)+ or offering or giving to the !ublic officer the em!loyment mentioned in sub!aragra!h (d)+ or urging the divulging or untimely release of the confidential information referred to in sub!aragra!h (3) of this section shall= together >ith the offending !ublic officer= be !unished under Section nine of this Act and shall be !ermanently or tem!orarily dis1ualified in the discretion of the Court= from transacting business in any form >ith the <overnment

GGv

Su!ra note 0# See B:H* RIBBO" ;RA"SCRIP; %OR "O7*-B*R E= 06$,= su!ra note 94

GGvi

Page 94 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21

T=e .=istle?loCers "ote that some of "a!olesI em!loyees served as >histleblo>ers for this investigation= and !rovided critical information to hel! the !rosecution !revent similar scams in the future ;hese >histleblo>ers= although technically considered !artici!ants of &anet :imD"a!olesI o!erations= >ere not included in the com!laint filed by the "ational Bureau of Investigation ("BI)= for their immeasurable value as >itnesses for the !rosecution and because they >ere !robably not considered the most guilty In all these cases= the >histleblo>ers >ere able to clearly and convincingly eG!lain ho> bogus "<Os >ere set u!= under the direction of &anet :imD"a!oles= in order to access and a!!ro!riate the P.A% of certain legislators= for !ersonal use Against the general denials of &anet :imD"a!oles and the government officials 1uestioned= the >histleblo>ers gave s!ecific and categorical details= >ith conviction= about their rac3eteering activities= and ho> &anet :imD"a!oles >or3ed closely >ith legislators and their agents= in order to overcome= if not contravene= the !rocedural re1uirements for successful fund releases Ru?B Tuason In addition= -s Ruby ;uason has a!!lied to be a state >itness and is being seriously considered by the !rosecution based on the value of her testimony and the eGtent of her coo!eration
$06

;he >eight of her testimony cannot be do>n!layed as

established in the follo>ing eGchange?

$06

B:H* RIBBO" ;RA"SCRIP; %OR %*BRHARQ $,= 06$# su!ra note 4/= at /D$6

Page 95 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41

SEN $EFENSOR SANTIAGO MMM In your affidavit= Page C= you said in as>er to Ouestion "o ,,= 'I !ersonally) R !ersonally R I cannot em!hasi(e this enough R 'I !ersonally delivered all the shares of Senator &inggoy *strada for the abovementioned transactions in <reenhills= San &uan or in his office in the Senate ) Bhen you meant '!ersonally=) that means you yourself= isnIt that soS MS TUASON Qes= maIam SEN $EFENSOR-SANTIAGO And >hen you say= '!ersonally=) do you mean that you delivered it to Senator *strada himself or he >as 8ust in the vicinityS MS TUASON "o= to himself SEN $EFENSOR-SANTIAGO ;o himself And there is nothing >rong >ith your eyes or your sense of touch= rightS MS TUASON "o SEN $EFENSOR-SANTIAGO recogni(e Senator *stradaS MS TUASON Qes= maIam SEN $EFENSOR-SANTIAGO And of course= you 3no> >hen you yourself >ere doing it because you are not yet suffering from dementia Hnli3e other old !eo!le I 3no> Qes So this is categorical eye>itness evidence *ye>itness evidence does not al>ays need corroboration %or the instruction of those >ho have been discussing the la> as if they 3no> it Qou are an eye>itness ;hat is= in the >ords of Secretary of &ustice= slam dun3 evidence+ or in my o>n >ords= that is bullIs eye dahil na3ita mo mismo (*m!hasis su!!lied)$0$ Qou are not halfDblindS Qou can

Regarding ;uasonIs 1ualifications to be a state >itness= Sen .efensorDSantiago eG!lained her o!inion?

$0$

B:H* RIBBO" ;RA"SCRIP; %OR %*BRHARQ $,= 06$#= su!ra note 4/= at $$9D$$4

Page 96 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31

SEN $EFENSOR-SANTIAGO" "gayon= in my !ersonal humble vie>= you fit all the re1uirements for a state >itness ;here are five re1uirements? "o $= there is an absolute necessity for your direct evidence+ "o 0= there is no other direct evidence= only yours+ "o ,= your testimony can be substantially corroborated in its material !oints there or your neighbours have already eGecuted affidavits >hen and in fact corroborate >hat you have said in your affidavit+ #= you are not the most guilty= not by any means If you are guilty= it is only because of the frailties of human nature But you are not the most guilty here And finally= as far as I 3no>= you have not been convicted of any crime involving an offense against[involving an offense concerning moral tur!itude So= you are a !erfect state >itness $00

-s ;uasonIs voluntary surrender and admission of guilt constitutes critical information that identifies t>o legislators as reci!ients of 3ic3bac3s sourced from simulated government !ro8ects Being an admission against interest= her statements deserve serious consideration by the court She >ould not have im!licated herself in these crimes if it >as not true ;his is 3no>n as an admission against interest= eG!lained by case la> as follo>s? Being an admission against interest= the documents are the best evidence >hich affords the greatest certainty of the facts in dis!ute ;he rationale for the rule is based on the !resum!tion that no man >ould declare anything against himself unless such declaration >as true ;hus= it is fair to !resume that the declaration corres!onds >ith the truth= and it is his fault if it does not $0,

It is also >orthy of note that -s ;uasonIs testimony is corroborated by no less than -r :uy? MR LU(" 2asi since I >as illegally detained and after I >as rescued= I have been !ersistent na the :ord >ill send >itnesses to

$00

B:H* RIBBO" ;RA"SCRIP; %OR %*BRHARQ $,= 06$#= su!ra note 4/= at $04 Hle! v .ucat= < R "o $9/0C# (066/) citing Rufina Patis %actory v Alusitain= #EC Phil 9## (066#)

$0,

Page 97 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

corroborate my statements that I am not fabricating stories= that I am not inventing stories ;hese are nangyayari talaga SEN A CA(ETANO" So meaning= alam mong !ag nagsabi siya ng buong 3atotohanan= alam mong mabiDvindicate 3ayo doon sa mga sinasabi ninyoS MR LU(" Qeah O!o
$0#

$ennis Cunanan .ennis Cunanan= .irector <eneral of the ;RC testified before the Committee on -arch 4= 06$# Cunanan is also submitting himself for consideration to be a state >itness in the cases involving ;RC
$09

CunananIs testimony su!!orts the case theory

that there >as direction by the la>ma3ers involved in the stealing of !ublic funds and that ;RC >as used only as a conduit for the >hole o!eration CunananIs testimony is largely su!!orted by the testimonies of the >histleblo>ers= eGce!t as to >hether or not he received 3ic3bac3s from the transactions
$04

;his Committee leaves this matter u! to

the .O& and the Ombudsman to decide u!on -r CunananIs fitness to be granted immunity from !rosecution Hltimately= this Committee is confident that the !rosecution >ill be able to >eed out the fiction from the facts !resented in CunananIs testimony and ma3e the !ro!er 8udgment as to his fate

$0#

B:H* RIBBO" ;RA"SCRIP; %OR %*BRHARQ $,= 06$#= su!ra note 4/= at $/= $ECD$E/ B:H* RIBBO" ;RA"SCRIP; %OR -ARC@ 4= 06$#= su!ra note #4= at C#

$09

$04

Id = at $94 to $9/

Page 98 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22

Ot=er Persons o< Interest <or Furt=er In@estigation .ue to a lac3 of information= the Committee is unable to ma3e a !ronouncement as !ossible liability of -rs "a!olesI relatives= em!loyees= or friends identified by the >histleblo>ers "evertheless= these individuals must be investigated further? &o

Christine "a!oles= Reynaldo '&o8o) :im= Ronaldo %rancisco :im= *velyn .itchon .e :eon= "ova 2aye .ulay= &aime <arcia "a!oles= &ames Christo!her :im= &eane Catherine :im "a!oles= &ane Catherine :im "a!oles= &ohn Christian :im "a!oles= Rosita 2a>son Co= &ohn Raymund de Asis= %elimon Agustin= Sim!licio <umafeliG= 7anessa *man= &ocelyn Piorato= "emesio Pablo= -ylene *ncarnacion= <enevieve Hy= &ohn Raymund .e Asis= :ilian *s!anol= &esus Castillo= *ulogio Rodrigue(= :orna Ramire(= *velyn .e :eon and Ronald &ohn :im= and others that may be later identified &ose Antonio *vangelista= one of Sen *nrileIs agents and designated signatories for P.A%Drelated documents remains a !erson of interest and should be investigated in order to ascertain his !artici!ation in the scam Although his signature a!!ears in some of the P.A% documents= not much else is 3no>n about his role @is 3no>ledge about the o!erations in Sen *nrileIs office may be useful Because the Committee >as unable to summon former members of the @ouse of Re!resentatives to a!!ear before it= further investigation is needed regarding the !ro!riety of filing charges against them "evertheless= >e ta3e notice of the fact that they are !resently being investigated by the Ombudsman based on com!laints and evidence !rovided by the .O& ;hese !ersons are former Re! Ri(alina SeachonD:anete and her agent &ose Sumal!ong= former Re! *dgar 7alde(= former Re! Rodolfo Pla(a=
Page 99 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19

former Re! Samuel .ang>a and former Re! Constantino &araula $0E Be leave this matter to the >isdom of the Ombudsman Salvador Salacu!= @ead of PR*C during the relevant !eriod= should be investigated for !ossible involvement -r :uy mentioned other government officials >ho received 3ic3bac3s li3e Ofelia Aga>in (PR*C)= <igi Buenaventura (":.C) and AleGis Sevidal (":.C) $0C ;here >as also mention of former -etroban3 manager= Binnie 7illanueva= >ho >as a close friend of -rs "a!oles and >or3ed for the latter after the formerIs retirement from the ban3
$0/

;he Ombudsman and the A-:C may >ant to

follo> these leads to discover more information and evaluate their res!ective liabilities In consideration of all the evidence !resented= the Committee is= therefore= convinced that? a) the facts and circumstances !resented during its series of hearings >ould lead a reasonably discreet and !rudent man to believe that offenses have been committed+ b) there is sufficient basis to !roceed >ith the criminal !rosecution of the !ersons mentioned above+ and c) that they should be tried at the soonest !ossible time

& 1 A##li>ation as State .itness

;ime and time again= certain resource !ersons= >ho testify before the Blue Ribbon Committee= are in danger of !rosecution ;o claim immunity from !rosecution= they sometimes ma3e an a!!eal directly to the Committee to be admitted as state

$0E

B:H* RIBBO" ;RA"SCRIP; %OR "O7*-B*R E= 06$,= su!ra note 94= at 40D49

$0C

Su!ra note C, &oint Statement of Benhur 2 :uy= -erlina P Su5as= <ertrudes 2 :uy= and Anabelle :uyDReario= August 9= 06$,= at ED$4

$0/

Page 100 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19

>itness ;he Blue Ribbon Committee= ho>ever= does not have the !o>er to grant any of its resource !ersons state >itness status As this matter is ca!able of re!etition= the Committee finds it !rudent to finally !ut to rest the issue of >hether or not the Committee could confer state >itness !rotection ;he Committee >ould li3e to underscore the fact that it is not >ithin its 8urisdiction to besto> immunity from !rosecution As a general rule= committees of the Senate are essentially tas3ed to conduct hearings= in aid of legislation In addition= the Senate Blue Ribbon Committee is uni1ue in the sense that it can investigate matters to !in!oint accountability of !ublic officers on account of malfeasance$,6= misfeasance$,$ and nonfeasance$,0 in office
$,,

Bhile the Committee does not have the authority to besto> immunity= the best it could do is to recommend that an individual be admitted to the governmentIs >itness !rotection !rogram ;his is also in line >ith Section # of the Bitness Protection=

Security and Benefit Act=$,# >hich reads?

Se>tion & .itness in Legislati@e In@estigations D In case of legislative investigations in aid of legislation= a >itness= >ith his eG!ress consent= may be admitted into the Program u!on the recommendation of the legislative committee >here his testimony is needed >hen in its 8udgment there is !ressing necessity therefor? Provided= ;hat such recommendation is a!!roved by the
$,6

'illegal or dishonest activity es!ecially by a !ublic official or a cor!oration ) Available at htt!?AA>>> merriamD >ebster comAdictionaryAmalfeasance (last accessed -arch 0E= 06$#)
$,$

'the !erformance of a la>ful action in an illegal or im!ro!er manner ) Available at htt!?AA>>> merriamD >ebster comAdictionaryAmisfeasance (last accessed -arch 0E= 06$#)
$,0

'failure to do >hat ought to be done ) Available at htt!?AA>>> merriamD>ebster comAdictionaryAnonfeasance (last accessed -arch 0E= 06$#)
$,,

Rules of the Senate= Rule M= N$, (,4) R A 4/C$ 'An Act Providing %or A Bitness Protection= Security and Benefit Program and %or Other Pur!oses) A!ril 0#= $//$

$,#

Page 101 of 122

1 2 3 4 5 6 7 8 9

President of the Senate or the S!ea3er of the @ouse of Re!resentatives= as the case may be (*m!hasis su!!lied)

Hnder our system of government= only the .e!artment of &ustice (.O&)= the Office of the Ombudsman and the courts have the authority to grant immunity ;he case of Qu vs @onorable Presiding &udge$,9 is elucidating in terms of !roviding a discussion about the different modes of discharge to be a state >itness ;he immunity offered in R A 4/C$$,4 is granted by the .O&= >hile the one !rovided under the Rules of Court$,E is granted by the courts

$,9

< R "o $#0C#C= &une ,6= 0664 RA 4/C$= su!ra note $,#= N $6

$,4

Se>tion '2 State .itness D Any !erson >ho has !artici!ated in the commission of a crime and desires to be a >itness for the State= can a!!ly and= if 1ualified as determined in this Act and by the .e!artment= shall be admitted into the Program >henever the follo>ing circumstances are !resent?
(a) (b) (c) (d) (e) (f) the offense in >hich his testimony >ill be used is a grave felony as defined under the Revised Penal Code or its e1uivalent under s!ecial la>s+ there is absolute necessity for his testimony+ there is no other direct evidence available for the !ro!er !rosecution of the offense committed+ his testimony can be substantially corroborated on its material !oints+ he does not a!!ear to be most guilty+ and he has not at any time been convicted of any crime involving moral tur!itude

An accused discharged from an information or criminal com!laint by the court in order that he may be a State Bitness !ursuant to Section / and $6 of Rule $$/ of the Revised Rules of Court may u!on his !etition be admitted to the Program if he com!lies >ith the other re1uirements of this Act "othing in this Act shall !revent the discharge of an accused= so that he can be used as a State Bitness under Rule $$/ of the Revised Rules of Court
$,E

Revised Rules on Criminal Procedure= Rule $$/= N $E RH:* $$/ R ;RIA:

Se> 'A $is>=arge o< a>>use% to ?e state Citness R Bhen t>o or more !ersons are 8ointly charged >ith
the commission of any offense= u!on motion of the !rosecution before resting its case= the court may direct one or more of the accused to be discharged >ith their consent so that they may be >itnesses for the state >hen= after re1uiring the !rosecution to !resent evidence and the s>orn statement of each !ro!osed state >itness at a hearing in su!!ort of the discharge= the court is satisfied that? (a) ;here is absolute necessity for the testimony of the accused >hose discharge is re1uested+ (b) ;here is no other direct evidence available for the !ro!er !rosecution of the offense committed= eGce!t the testimony of said accused+ (c) ;he testimony of said accused can be substantially corroborated in its material !oints+ (d) Said accused does not a!!ear to be the most guilty+ and (e) Said accused has not at any time been convicted of any offense involving moral tur!itude *vidence adduced in su!!ort of the discharge shall automatically form !art of the trial If the court denies the motion for discharge of the accused as state >itness= his s>orn statement shall be inadmissible in evidence

Page 102 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Aside from the .O& and the courts= another government body D in the form of an inde!endent constitutional body D also has the !o>er to besto> immunity ;he Office of the Ombudsman= under ;he Ombudsman Act of $/C/=$,C also has the ability to endo> a !erson >ith immunity from criminal !rosecution Considering the foregoing= the Committee >ould li3e to finally lay do>n the rule that it has no ca!acity to confer immunity in any sha!e or form Any re1uest for immunity should be referred to the !ro!er government bodies

& / Re<errals
& / ' Re<erral to Senate Co;;ittee on Et=i>s P Pri@ileges ;he Committee recommends that the Senate Committee on *thics and Privileges to investigate the accusations of !lunder against the accused senators Allegations of !lunder reflect de!lorably on the dignity= integrity and re!utation of the entire Senate=

$,C

R A 4EE6= An Act Providing for the %unctional and Structural Organi(ation of the Office of the Ombudsman= and for other Pur!oses "ovember $E= $/C/

Se>tion 'A I;;unities [ In all hearings= in1uiries= and !roceedings of the Ombudsman= including
!reliminary investigations of offenses= no !erson sub!oenaed to testify as a >itness shall be eGcused from attending and testifying or from !roducing boo3s= !a!ers= corres!ondence= memoranda andAor other records on the ground that the testimony or evidence= documentary or other>ise= re1uired of him= may tend to incriminate him or sub8ect him to !rosecution? Provided= ;hat no !erson shall be !rosecuted criminally for or on account of any matter concerning >hich he is com!elled= after having claimed the !rivilege against selfD incrimination= to testify and !roduce evidence= documentary or other>ise Hnder such terms and conditions as it may determine= ta3ing into account the !ertinent !rovisions of the Rules of Court= the Ombudsman may grant immunity from criminal !rosecution to any !erson >hose testimony or >hose !ossession and !roduction of documents or other evidence may be necessary to determine the truth in any hearing= in1uiry or !roceeding being conducted by the Ombudsman or under its authority= in the !erformance or in the furtherance of its constitutional functions and statutory ob8ectives ;he immunity granted under this and the immediately !receding !aragra!h shall not eGem!t the >itness from criminal !rosecution for !er8ury or false testimony nor shall he be eGem!t from demotion or removal from office Any refusal to a!!ear or testify !ursuant to the foregoing !rovisions shall be sub8ect to !unishment for contem!t and removal of the immunity from criminal !rosecution (*m!hasis su!!lied)

Page 103 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17

as an institution ;his Committee= having 8urisdiction over 'all matters relating to the conduct= rights= !rivileges= safety= dignity= integrity and re!utation of the Senate and its members=)$,/ is dutyDbound therefore to conduct a hearing to disci!line its members

& / 1 Re<erral to t=e Integrate% Bar o< t=e P=ili##ines *IBP) an% t=e Su#re;e Court <or $is?ar;ent or $is>i#linarB Pro>ee%ings against ;e;?ers o< t=e Legal Pro<ession in@ol@e% %rom the beginning= there have been a number of la>yers involved in this case ;he most !rominent among them are Sen &uan Ponce *nrile= &essica Reyes= and Richard Cambe ;here are also others >ho served as notaries= business advisers and legal counsels to the accused ;o evaluate the conduct and fitness of these !ersons to continue serving as members of the legal !rofession and officers of the court= this Committee refers these cases to the Integrated Bar of the Phili!!ines (IBP) and the Su!reme Court for .isbarment or .isci!linary !roceedings In order to !reserve its re!utation and

integrity= the legal !rofession must be free from those >ho use their 3no>ledge and s3ills to !erform or facilitate criminal activity
$,/

$#6

Rules of the Senate= Rule M= N$,(0)

$#6

Integrated Bar of the Phili!!ines Commission on Bar .isci!line <uidelines for Im!osing :a>yer Sanctions= available at htt!?AA>>> ib! !hAd64 html (last accessed -arch 0E= 06$#)= Rule 9 reads? 9 6 7iolations of .uties O>ed to the Public 9 $ %ailure to -aintain Personal Integrity Absent aggravating or mitigating circumstances= u!on a!!lication of the facts set out in Standard , 6= the follo>ing sanctions are generally a!!ro!riate in cases involving commission of a criminal act that reflects adversely on the la>yerIs honesty= trust>orthiness= or fitness as a la>yer in other res!ects= or in cases >ith conduct involving dishonesty= fraud= deceit= or misre!resentation?

Page 104 of 122

1 2 3 4 5 6 7

& & Poli>B Measures

& & ' InstitutionaliJe real-ti;e au%it o< NGOs t=at re>ei@e go@ern;ent <un%s "onDgovernment Organi(ations= that are reci!ients of government funds= should be sub8ect to realDtime audit RealDtime auditing or auditing concurrently as the !ro8ect is im!lemented= may ni! the !roblem of corru!tion in the bud Bith this mode of auditing= government auditors >ill be given the o!!ortunity to detect and investigate

9 $$ .isbarment is generally a!!ro!riate >hen? (a) a la>yer engages in serious criminal conduct= a necessary element of >hich includes intentional interference >ith the administration of 8ustice= false s>earing= misre!resentation= fraud= eGtortion= misa!!ro!riation= or theft+ or the sale= distribution or im!ortation of controlled substances+ or the intentional 3illing of another+ or an attem!t or cons!iracy or solicitation of another to commit any of these offenses+ or (b) a la>yer engages in any other intentional conduct involving dishonesty= fraud= deceit= or misre!resentation that seriously adversely reflects on the la>yerIs fitness to !ractice 9 $0 Sus!ension is generally a!!ro!riate >hen a la>yer 3no>ingly engages in criminal conduct >hich does not contain the elements listed in Standard 9 $$ and that seriously adversely reflects on the la>yerIs fitness to !ractice 9 $, Re!rimand is generally a!!ro!riate >hen a la>yer 3no>ingly engages in any other conduct that involves dishonesty= fraud= deceit= or misre!resentation and that adversely reflects on the la>yerIs fitness to !ractice la> 9 $# Admonition is generally a!!ro!riate >hen a la>yer engages in any other conduct that reflects adversely on the la>yerIs fitness to !ractice la> 9 0 %ailure to -aintain the Public ;rust Absent aggravating or mitigating circumstances= u!on a!!lication of the factors set out in Standard , 6= the follo>ing sanctions are generally a!!ro!riate in cases involving !ublic officials >ho engage in conduct that is !re8udicial to the administration of 8ustice or >ho state or im!ly an ability to influence im!ro!erly a government agency or official? 9 0$ .isbarment is generally a!!ro!riate >hen a la>yer in an official or governmental !osition 3no>ingly misuses the !osition >ith the intent to obtain a significant benefit or advantage for himself or another= or >ith the intent to cause serious or !otentially serious in8ury to a !arty or to the integrity of the legal !rocess 9 00 Sus!ension is generally a!!ro!riate >hen a la>yer in an official or governmental !osition 3no>ingly fails to follo> !ro!er !rocedures or rules= and causes in8ury or !otential in8ury to a !arty or to the integrity of the legal !rocess 9 0, Re!rimand is generally a!!ro!riate >hen a la>yer in an official or governmental !osition negligently fails to follo> !ro!er !rocedures or rules= and causes in8ury or !otential in8ury to a !arty or to the integrity of the legal !rocess 9 0# Admonition is generally a!!ro!riate >hen a la>yer in an official or governmental !osition engages in an isolated instance of negligence in not follo>ing !ro!er !rocedures or rules= and causes little or no actual or !otential in8ury to a !arty or to the integrity of the legal !rocess

Page 105 of 122

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fraud and all sorts of irregularities in a timely fashion 'Public interest is best served if the government audit function is used in Ureal timeI to !romote accountability and control over !ublic resources= !revent fraud and evaluate >hether government services are !rovided efficiently= effectively and in com!liance >ith la>s and regulations )$#$ &&1 Bla>Flist NGOs an%:or t=eir in>or#orators : o<<i>ers: t=eir #ri@ate se>tor #artners <or anB Crong%oing "ot>ithstanding the fact that !artnershi!s >ith the !rivate sector shall be a continuous !olicy of the state= in delivering !ublic service efficiently= the government should eGercise vigilance to avoid re!etition in the misuse of the national >ealth Pertinent government agencies should therefore blac3list "<Os= !eo!leIs organi(ations= their incor!orators= officers and other !rivate sector !artners >ho either refuse to submit documents= !resent s!urious documents= or fail to li1uidate !ublic funds !ro!erly= among other violations or transgressions & & / En=an>e t=e su#er@isorial an% regulatorB <un>tions o< t=e Se>urities an% EK>=ange Co;;ission *SEC) o@er non-sto>F0 non#ro<it organiJations *NSPOs) ;o !revent the o!eration of bogus "<Os= and to ensure that they strictly com!ly >ith all !ertinent la>s and rules and regulations= the S*C should boost its surveillance and monitoring ca!acity= in line >ith its su!ervisorial and regulatory functions over 8uridical entities= and in !articular= nonDstoc3= nonD!rofit organi(ations ("SPOs)

$#$ H S <overnment Accountability Office= <overnment Auditing Standards? ;em!orary *Gem!tions and <uidance in Re!onse to @urricanes 2atrina and Rita= available at htt!?AA>>> gao govAgovaudAhurricanedocument !df (last accessed -arch 0E= 06$#)= at $

Page 106 of 122

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According to the Securities and Regulations Code= the S*C has the !o>er to 'regulate= investigate or su!ervise the activities of !ersons to ensure com!liance )$#0 'Only t>o (0) de!artments are monitoring "SPOs at the S*C? $) ;he Com!any Registration and -onitoring .e!artment (CR-.) for ordinary cor!orations+ and 0) Cor!orate <overnance and %inance .e!artment (C<%.) for "SPOs )$#, ;he S*C further stated that 'the monitoring !rocess consists mainly of table monitoring .ue to the inade1uacy of man!o>er and the large volume of "SPOs registered >ith the S*C= on site or ocular ins!ection is not regularly conducted ;his is a >aterloo that must be addressed at the moment )$## ;o illustrate the inade1uacy of man!o>er= Chair!erson @erbosa stated that there are only eight (C) !rocessors in C<%. that handle a total of 06=666 foundations= of >hich $6=666 are active
$#9

;o strengthen the S*CIs !olice functions= the Committee ado!ts the follo>ing recommendations !ut for>ard by the S*C?
$) Augmenting the man!o>er monitoring "SPOs or "<Os= including foundations 0) Strengthening S*C !ost registration or investigation and surveillance authority as a means to facilitate the verification and identity or other !rofiles of the cor!oration or of ferreting out nominees and dummies

$#0

R A CE//= N 9(d)

$#,

Securities and *Gchange Commission? Position !a!er on *nhancement of S*C -onitroing of "onDProfit Organi(ations= &anuary 0C= 06$#= Jhereinafter= S*C POSI;IO" PAP*RK
$##

Id
;S"? Caturla IID$= &anuary ,6= 06$# $6?,EA-= Jhereinafter B:H* RIBBO" ;RA"SCRIP; %OR &A"HARQ ,6= 06$#K at $,

$#9

Page 107 of 122

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,) Setting u! a com!uterDassisted system to revie> a!!lications >ithout delaying (the) registration !rocess #) Setting a criteria for the selection of "SPOs that shall be sub8ected to offDsite or onDsite eGamination such as? i) ;he re!orts submitted by the "SPOs are materially deficient or misstated+ ii) A trend analysis (hori(ontal or vertical) of the financial date of the "SPOs sho>ing significant changes from year to year+ iii) .isclosures in the financial statements reveal material related !arty transactions+ and iv) Other sus!icious circumstances (e g same auditor+ same ban3)$#4

Bith res!ect to monitoring "SPOs= in !articular= the Committee fully su!!orts the efforts of S*C to accom!lish the follo>ing?
A Classify the "SPOS= >hether high ris3 or lo> ris3= in accordance >ith the !ertinent ris3Dbased management !rinci!les B -obili(ing all S*C *Gtension Offices in the various !arts of the country in the monitoring of "SPOs including the conduct of ocular ins!ection or initial factDfinding investigation in coo!erationAcoordination >ith the local government units and other la> enforcement agencies C Re1uiring the government agencies to endorse registration of "SPOs >hich may be beneficiaries of the government funds Prior to funding= the "SPO must !resent a Certificate of <ood Standing to be secured from the S*C as !roof of its com!liance >ith the legal re1uirements and S*C rules and regulations . Re1uiring "SPOs to ado!t a Code of Cor!orate <overnance to guide the trustees and officers and those managing or administering the affairs of the "SPOs of their strict adherence to moral or ethical values * %ull com!uteri(ation of the S*C "SPOs information system through the creation of databse containing information on the !rinci!al office= the board of trustees and officers= !ur!oses and other vital information o!en for !ublic vie>

$#4

S*C POSI;IO" PAP*R= su!ra note $#,

Page 108 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

% Continuing revie>= revision= or amendment of S*C rules and regulations concerning "SPOs ;he follo>ing are hereby !ro!osed? a Pre!aration of a matriG of re1uirements sho>ing the different classifications of "SPOs= eGisting common and s!ecial re1uirements li3e endorsements= and !ro!osed revisionsAadditional re1uirements b *nhancement and consolidation of the eGisting guidelines= chec3list= (or) circulars for "SPOs into one rule for ease of com!liance and monitoring $#E

By im!lementing the aforementioned !ro!osals= those "SPOs >ith fraudulent intentions= could be stymied straight a>ay= before they could eGecute their nefarious !lans Hltimately= the S*C should serve as the governmentIs frontline troo! in defending against dubious and dishonest cor!orations= !artnershi!s and associations= including "SPOs or "<Os & & & En=an>e t=e su#er@isorial an% regulatorB <un>tions o< t=e Coo#erati@e $e@elo#;ent Aut=oritB *C$A) o@er >oo#erati@es ;he Coo!erative .evelo!ment Authority (C.A) im!lements the !olicy of the State 'to !romote the viability and gro>th of coo!eratives as instruments of e1uity= social 8ustice and economic develo!ment )$#C Among the C.AIs su!ervisorial and regulatory !o>ers include the follo>ing?
Se>tion / PoCers0 Fun>tions an% Res#onsi?ilities [ ;he Authority shall have the follo>ing !o>ers= functions and res!onsibilities?

21 22 23

24

25 26 27
$#E

Id
P@I: CO"S; art MII N$9

$#C

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$#/

MMM (e) Register all coo!eratives and their federations and unions= including their division= merger= consolidation= dissolution or li1uidation It shall also register the transfer of all or substantially all of their assets and liabilities and such other matters as may be re1uired by the Authority+ (f) Re1uire all coo!eratives= their federations and unions to submit their annual financial statements= duly audited by certified !ublic accountants= and general information sheets+ (g) Order the cancellation after due notice and hearing of the coo!erativeTs certificate of registration for nonDcom!liance >ith administrative re1uirements and in cases of voluntary dissolution+ MMM

.uring the &anuary ,6= 06$# hearing= the Committee >as informed that the C.A has fifteen ($9) regional offices evaluating registration documents of a!!licants for coo!erative status= and that 'coo!erative develo!ment s!ecialists) are assigned by the C.A for every congressional district to conduct regular ins!ections of coo!eratives
$#/

;he C.A should further intensify its efforts to oversee the o!erations of coo!eratives to ensure that they serve 'as instruments of e1uity= social 8ustice and economic develo!ment) and not as tools for !lunder= malversation= corru!tion or fraud= as have been the case for some of the "<Os involved in the P.A% Scam ;he C.A should therefore continue to eGercise its mandate >ith rene>ed vigour and dedication

& & 3 Co;#uteriJation o< a >entraliJe% %ata?ase on NGOs o< t=e Se>urities an% EK>=ange Co;;ission *SEC)0 t=e Bureau o< Internal Re@enue *BIR)0 t=e Co;;ission on Au%it *COA)0 t=e
B:H* RIBBO" ;RA"SCRIP; %OR &A"HARQ ,6= 06$# su!ra note $#9= at ,/D#6

Page 110 of 122

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21

Coo#erati@e $e@elo#;ent Aut=oritB *C$A)0

t=e $e#art;ent o<

La?or an% E;#loB;ent *$OLE)0 t=e $e#art;ent o< Bu%get an% Manage;ent *$BM)0 t=e $e#art;ent o< So>ial .el<are0 an% $e@elo#;ent *$S.$)0 an% ot=er #ertinent agen>ies

;o strengthen measures on good governance= trans!arency and accountability= the government should ta3e advantage of Information and Communications ;echnology (IC;) ;echnology >ould greatly facilitate the constant lin3age among government agencies= >hich in turn is vital in running any government By investing in a

com!uteri(ed and centrali(ed database of all !ertinent information !ertaining to "<Os= the government >ould ensure an effective and efficient mechanism that >ould screen and 3ee! trac3 of these "<Os Chair!erson @erbosa herself affirms the eG!edience of having a 'com!uter assisted revie>) >hen she admitted that they (S*C) '>ould have !robably been able to detect fraud in !rocuring registration at the very first instance) if such system >as already in !lace
$96

By convention= the S*C ado!ts a disclosure system= >herein it only

$9$

relies on documents submitted

By e1ui!!ing the Securities and *Gchange Commission (S*C)= the Bureau of Internal Revenue (BIR)= the Commission on Audit (COA)= the Coo!erative .evelo!ment Authority (C.A)= the .e!artment of :abor and *m!loyment (.O:*)= the .e!artment of Budget and -anagement (.B-)= the .e!artment of Social Belfare and .evelo!ment
$96

B:H* RIBBO" ;RA"SCRIP; %OR &A"HARQ ,6= 06$# su!ra note $#9= at $9

$9$

Id

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19

(.SB.)= and other !ertinent agencies >ith a com!uteri(ed and centrali(ed database= ris3 assessment could be underta3en eG!ediently= red flag alerts could be raised !rom!tly= and these government agencies could effortlessly crossDreference >ith one anotherIs information & & 5 A;en% Co;;ission on Au%it Cir>ular 122A-22' in or%er to i) #ro=i?it NGOs0 C=i>= =a@e ?een in o#eration <or less t=an t=ree */) Bears <ro; ?eing re>i#ients o< go@ern;ent <un%s$90 an% ii) reMuire NGOs to #ro@e t=eir >a#a>ities

i) Prohibit "<Os= >hich have been in o!eration for less than three (,) years from being reci!ients of government funds
COA Circular 066ED66$= dated 09 October 066E= !ertains to 'Revised <uidelines in the granting= utili(ations= accounting and auditing of the funds released to "onD <overnmental Organi(ationsAPeo!leIs Organi(ations ("<OsAPOs) ) Hnder the Circular= an "<OAPO= >hich has been in o!eration for less than three (,) years= is eligible to a!!ly for government funding $9, It is necessary that this Circular be amended in order to !revent bogus "<Os from misa!!ro!riating government funds COA should forbid such fledgling "<Os from !artici!ating in the disbursement of government funds

ii) Re1uire "<Os to !rove their ca!acities

$90

CO.*D"<O? Position !a!er on Recommendations for Im!roved <uidelines to *nsure Integrity F Promote *ffective Hse of <vernment %unding to CSOsA"<Os= August 06$,
$9,

CO--ISIO" O" AH.I; CIRCH:AR 066ED66$= su!ra note $60= !ar # # ,

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

-ost im!ortantly= "<Os should first reach a certain maturity= in terms of trac3 record= develo!mental milestones= evidence of socioDcivic accom!lishments= and financial= technical and legal ca!abilities before they could engage >ith government &&A $ire>t t=e Boar% o< $ire>tors or Manage;ent o<

Go@ern;ent OCne% or Controlle% Cor#orations to un%ergo a ;an%atorB se;inar on goo% go@ernan>e In the case of "ABCOR and PR*C= most of the members of their res!ective boards are officials of the .e!artment of Agriculture
$9#

Bhen they >ere as3ed by COA

>hy they chose a certain "<O to engage >ith= they re!lied that a certain legislator instructed them to do so $99 ;his demonstration of !assing the blame on someone else reveals un!rofessionalism= indifference and ine!titude in the running of <overnment O>ned or Controlled Cor!orations (<OCCs) ;o engender !rofessionalism= it should be a conditio sine 1ua non for the board and management of <OCCs to attend a seminar on good governance= before they could officially assume their res!ective roles in the <OCC ;he <C< may be the a!!ro!riate agency to conduct this seminar

$9#

B:H* RIBBO" ;RA"SCRIP; %OR &A"HARQ ,6= 06$#= su!ra note $#9= at 46

$99

Id

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& 3 Legislati@e Measures

& 3 ' Passage o< a laC on NGO A>>re%itation <or Go@ern;ent Contra>ts A la> should be !assed immediately re1uiring all government agencies releasing funds to "<OsACivil Society Organi(ationsAPeo!leIs Organi(ations= to validate these entities ;he !rocess of validation= to be follo>ed by government agencies= must include the follo>ing?
$$ ;he organi(ationIs trac3 record (clear 7isionD-issionD<oals and !rograms >hich are in line >ith the !ro8ect= audited financial statements= im!lementation of its !ast !ro8ects) $0 Its governance structure and !ractices= including functionality of the Board and any !ossible conflict of interest $, Its affiliation and net>or3s and feedbac3 from these grou!s $# Its accreditation by "<As or :<Hs and their feedbac3 about the organi(ation $9 Pro8ect site validation and community intervie>s >here the CSO has onDgoing andAor !revious !ro8ects $94

Accreditation of "<Os shall be decentrali(ed in recognition of the divergent features and !eculiarities of these entities As a case in !oint= the .e!artment of Social Belfare and .evelo!ment (.SB.) has a 'Standards Bureau) that 'conducts a tedious and thorough accreditation !rocess )$9E ;he Bureau identifies '"<Os that engage in honestDtoDgoodness social develo!ment >or3 in !oor communities in urban and rural

$94

Su!ra note $90

$9E

'.BS. is >illing to handle "<O Accreditation=) available at htt!?AA>>> !hilstar comAheadlinesA06$#A6,A$/A$,609#4Ads>dD >illingDhandleDngoDaccreditation= -arch $/= 06$# (last accessed -arch 0E= 06$#)

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

areas )$9C Incidentally= the .SB. has eG!ressed its >illingness to act as the governmentIs accreditation body for "<Os that eGecute governmentDfunded !ro8ects
$9/

Be ta3e cogni(ance of the eGistence of the Phili!!ine Council for "<O

Certification (PC"C)= >hich certifies "<Os Hnder *Gecutive Order "o E06=$46 the PC"C
is 'the governmentIs !artner in a system of accreditation= to determine the 1ualification of domestic cor!orations or associations or "<Os organi(ed and o!erated eGclusively for religious= charitable= scientific= youth and s!orts develo!ment= cultural or educational !ur!oses= or for the rehabilitation of veterans= or to "<Os for accreditation as donee institutions )$4$ PC"CIs accreditation of an "<O as a donee institution is !rimarily for !ur!oses of taG deductibility as a business eG!ense $40 ;a3ing into account the !olicy of the government to streamline the bureaucracy in order to !romote economy and efficiency= and in vie> of the fact that PC"C is already !artnering >ith the government= PC"C could >ell serve as the governmentIs "<O Accreditation Council PC"C as the !remiere "<O Accreditation Council >ill be mandated to screen and monitor "<Os that >ish to !artici!ate in government contracts= >hich in turn >ould

$9C

Id Id

$9/

;he .e!artment of Social Belfare and .evelo!ment (.SB.) is ready to assume the tas3 of accrediting nonDgovernment organi(ations ("<Os) that can underta3e governmentDfunded !ro8ects or !rograms ;he .SB. said it has already ta3en note of the guidelines set in the accreditation of "<Os and civil society organi(ations (CSOs) by the <overnment A!!ro!riations Act (<AA) of 06$#
$46

*stablishment of a <overnmentD"on<overnment Partnershi! in the Accreditation of .onee Institutions relative to the taG deductibility of charitable contributions under Section ,# (@) of the "ational Internal Revenue Code= as amended
$4$

Id = at Sec 0 Id = at Sec $

$40

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entitle them to gain access to government funds

;his Council >ould be tas3ed to

determine >hether or not a certain "<O should be given the 'seal of good house3ee!ing=) a certificate of >hich >ould allo> the "<O to transact >ith the government <overnment agencies could therefore conduct their res!ective validations by see3ing certification from the PC"C In accrediting an "<O= the PC"C= acting as the governmentIs "<O Accreditation Council= >ould ta3e into consideration the si(e of the "<O R >hether it is micro= small= medium or large In addition= a graduated !rocess of accreditation shall be ado!ted= in >hich the re1uest for documentsA!roofs shall be done in tranches as the "<O continues to evolve Assuming the creation of an "<O Accreditation Council is not feasible= the Committee recommends enhancing the role of PC"C instead= as the established !artner of government in the accreditation of "<OS & 3 1 Passage o< a laC ;an%ating COA to au%it NGOs =an%ling go@ern;ent <un%s Currently= the COA com!lies >ith COA Circular 066ED66$=$4, >hich !rovides guidelines 'in the granting= utili(ation= accounting and auditing) of !ublic funds to "<Os and !eo!leIs organi(ations ;his circular abides by the fundamental tenet that '<O$4# funds granted the "<OsAPOs shall retain their character as !ublic funds )$49
$4,

Su!ra note $60

$4#

'<overnment Organi(ation R refers to national government agencies= local government units= governmentDo>ned or controlled cor!orations and their subsidiaries !roviding funds to the "<OAPO ) Su!ra note /C= at 0 #

$49

Su!ra note $60= !ar # $

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Considering that government funds transferred to "<Os maintain their character as !ublic funds= a la> is needed so that !ublic funds entrusted to "<Os are al>ays sub8ected to COA rules and regulations

& 3 / Passage o< a laC ;an%ating NGOs0 t=at are re>i#ients o< go@ern;ent <un%s0 to >o;#lB Cit= R A 6'O& *Go@ern;ent

Pro>ure;ent Re<or; A>t) an% its I;#le;enting Rules an% Regulations *IRR) Consistent >ith the !olicy mentioned in the immediately !receding

recommendation= "<Os !artici!ating in the utili(ation of government funds should com!ly >ith the <overnment Procurement Reform Act and its IRR ;his is also a recommendation of the COA in its S!ecial Audits Re!ort
$44

& 3 & Reiterating t=e nee% to #ass Free%o; o< In<or;ation ?ill ;he Committee reiterates the need to !ass the %reedom of Information Bill ;his bill 'see3s to !rovide the !ublic access to government documents and information in recognition of !eo!leTs right to 3no> ho> !olicies are crafted and ho> !ublic funds are s!ent )$4E

$44

COA R*POR;= su!ra note $$= at $,0

$4E An Act to Strengthen the Peo!leIs Right to Information JP*OP:*IS %R**.O- O% I"%OR-A;IO" AC; O% 06$,K= Senate Bill "o E#= $4th Congress (filed &uly $= 06$,)

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19

& 3 3 Reiterating t=e nee% to #ass GA;en%ing t=e Go@ern;ent Pro>ure;ent Re<or; A>tH ;he Committee reiterates the need to !ass the 'An Act Amending Section 49 of R A /$C#= other>ise 3no>n as the <overnment Procurement Reform Act) ;his bill 'eG!ands list of offenses that can be committed Hnder this bill= recommending= a!!roving FAor a>arding a contract to a bidder that is not legally= technically FAor financially ca!able >ill no> be !unishable )$4C & 3 5 Reiterating t=e nee% to #ass GAn A>t A;en%ing R A /2'60 Ot=erCise FnoCn as t=e Anti-Gra<t P Corru#t Pra>ti>es A>tH ;he Committee reiterates the need to !ass 'An Act Amending R A ,6$/= other>ise 3no>n as the AntiD<raft F Corru!t Practices Act ) ;his bill$4/ !rovides that any !ublic officer or !rivate !erson committing any of the unla>ful acts shall be !unished >ith im!risonment of not less than $0 years nor more than 06 years Jfrom 4 years F $ month to $9 yearsK and !rescri!tion of offenses increased to 06 years$E6 Jfrom $9 yearsK It also sti!ulates that 'the right of state to recover !ro!erties unla>fully ac1uired by !ublic officers from them or from their nominees or transferees shall not be barred by !rescri!tion= laches or esto!!el )

$4C An Act Amending Section 49 of Re!ublic Act "o /$C#= Other>ise 2no>n as the <overnment Procurement Reform Act= Senate Bill "o E4= $4th Congress (filed &uly $= 06$,) $4/

An Act Amending Re!ublic Act "o ,6$/= Other>ise 2no>n as the AntiD<raft and Corru!t Practices Act= Senate Bill "o $6C4= $4th Congress (filed &uly 0,= 06$,)
$E6

In consonance >ith H"CAC= this should be increased to ;@IR;Q years

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& 5 State;ent o< Su##ort

& 5 ' Su##orting t=e en%ea@our o< t=e Go@ernan>e Co;;ission <or Go@ern;ent OCne% or Controlle% Cor#orations *GCG) to strea;line Go@ern;ent OCne% or Controlle% Cor#orations

*GOCCs) ?B ensuring t=at onlB GOCCs0 rele@ant to national %e@elo#;ent0 are alloCe% to eKist ;he Committee su!!orts the recommendation of the <overnance Commission for <overnment O>ned or Controlled Cor!orations (<C<) to abolish "ational Agribusiness Cor!oration ("ABCOR) and Pamboanga del "orte College Rubber *states Cor!oration (PR*C) *nsuring trans!arency and accountability in the management and disbursement of taG!ayersI money begins >ith abolishing entities that may= >ittingly or un>ittingly= facilitate corru!tion ;he "ABCOR= a governmentDo>ned and controlledDcor!oration (<OCC) has been cited by the COA as one of the Im!lementing Agencies for P.A% %or CQ 066ED066/= it has received the gargantuan amount of Ph! $ 049 Billion$E$ PR*C= another <OCC= >hich >as also involved in the disbursement of P.A%= received the amount of Ph! 0/$ -illion
$E0

According to the S!ecial Audits Re!ort of the Commission on Audit on P.A% and

7arious Infrastructure including :ocal Pro8ects (7I:P) for CQ 066ED066/= 'significant

$E$

COA R*POR;= su!ra note $$= at #6

$E0

Id

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amounts of P.A% received >ere merely transferred to "ABCOR and PR*C even if the !ur!ose of releases is no longer >ithin the functions of the sub8ects <OCCs )$E, ;he Re!ort further stated that 'In vie> of the magnitude of releases and due to the inability of these <OCCs to im!lement the !ro8ects themselves= the funds >ere merely transferred to "<Os )$E# "ABCOR and PR*C have both been gravely remiss in their duty to eGercise due diligence in handling taG!ayersI money= and have rec3lessly !aved the >ay for the commission of fraud ;his has ultimately led to the largeDscale embe((lement of taG!ayersI money ;o !revent all o!!ortunities for corru!tion= "ABCOR and PR*C should be abolished Incidentally= the Committee also commends <C< Chair Cesar : 7illaneuvaIs continued !ursuit to rationali(e the countryIs <OCC sector It ta3es cogni(ance of the fact that <C< is also in the !rocess of recommending to the Office of the President the abolition of "ational :ivelihood .evelo!ment Cor!oration (":.C) and ;echnology Resource Center (;RC)= both of >hich >ere also tagged in the P.A% scam
$E9

$E,

Id Id = at #$
B:H* RIBBO" ;RA"SCRIP; %OR &A"HARQ ,6= 06$# su!ra note $#9= at 4,

$E#

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& 5 1 Su##orting all #ertinent re>o;;en%ations o< t=e COA <oun% in its S#e>ial Au%its O<<i>e Re#ort No 12'1-2/ ;he Committee su!!orts the recommendations$E4 !resented by COA that remain a!!licable and relevant= in light of the ruling of the Su!reme Court that declared P.A% as unconstitutional & 5 / Su##orting legislati@e ;easures o< UNCAC ;he Committee also advocates for the !assage of the legislative measures under the H"CAC $EE

3 CONCLU$ING REMAR4S
A!!roGimately eighty !ercent (C6V) of the P.A% has been lost !robably to corru!tion
$EC

If this manner of utili(ation of P.A% is descri!tive of ho> other

government funds are disbursed= then corru!tion is an endemic cancer insidiously s!reading= and leading our very government to absolute ruin ;he flurry of tem!estuous mass !rotests nation>ide= and even amongst %ili!ino communities abroad= eG!ose the fury of the !eo!le= >ho are thoroughly fed u!= and disgusted beyond endurance= over the bra(en= de!raved= and routinary !illaging of our national coffers ;his Re!ort relies heavily on the testimonies of the >histleblo>ers and >ith good reason &uGta!osition bet>een the bare >holesale denials of &anet :imD"a!oles= and the

$E4

COA R*POR;= su!ra note $$= at $,$D$,#

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Su!ra note 9
B:H* RIBBO" ;RA"SCRIP; %OR AH<HS; 0/= 06$,= su!ra note E= at $$9

$EC

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!ositive= categorical and s!ecific assertions of the >histleblo>ers= >ho testified >ith confidence= is revealing It is the best evidence in determining >ho is telling the truth
-ere denial cannot !revail over the !ositive testimony of a >itness+ it is selfDserving negative evidence >hich cannot be accorded greater evidentiary >eight than the declaration of credible >itnesses >ho testify on affirmative matters As bet>een the categorical testimony that rings of truth= on one hand= and a bare denial= on the other= the former is generally held to !revail $E/

;he Committee is confident that the !ublic shares its >isdom :est >e forget= >hile &anet :imD"a!oles has become the !roverbial '!oster child) of corru!tion= the entire P.A% Scam >ould not have been consummated >ithout the !artici!ation of a fe> from our august institution Bhile the Committee is a>are that only a handful of senators >ere involved= it cannot be denied that this has greatly damaged the re!utation of the Senate as an institution ;o restore the integrity of the Senate and the trust and confidence of the !ublic= an institutional !urging is needed once and for all

Fiat Dustitia ruat >aelu;

Y:et 8ustice be done though the heavens fall )

$E/

Peo!le v .umlao= < R "o $C$9// (066C)

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