Alleged rice smuggler admits using dummies

Davidson Bangayan, whom witnesses say is also David Tan, admits to financing farmers' cooperatives so he can use their permits. Senators say this is illegal.

'COOP FINANCIER.' Senate Agriculture Committee Chairperson Cynthia Villar gets Davidson Bangayan (leftmost) to admit that he was a financier of farmers' cooperatives in what Villar called an illegal scheme to import rice. Rappler photo

MANILA, Philippines – The man accused of being a top rice smuggler admitted to using farmers’ cooperatives to import rice, a practice that senators said is illegal.

In a Senate hearing on rice smuggling on Wednesday, January 22, businessman Davidson Bangayan admitted to transacting with a certain Willy Sy, whom past Senate witnesses have identified as a broker dealing with cooperatives. Bangayan is suspected of being the same person as notorious rice smuggler David Tan.

While Bangayan did not call the cooperatives his “dummies,” agriculture committee chairperson Senator Cynthia Villar explained that in the scheme, financiers and brokers tap farmers’ cooperatives and groups as “fronts” to secure rice importation permits. The committee first uncovered the scheme in the 15th Congress.

Using information from the past Senate investigation, Villar got Bangayan to admit financing farmers’ cooperatives. He also admitted his ties with persons and companies that the cooperatives linked to the scheme.

“I entered into a joint venture with some cooperatives and farmers groups,” Bangayan said. “It’s an industry practice. In 2012, they opened [the Minimum Access Volume program] to all willing, eligible participants. Normally, the coops join. It is open to all.”

Yet Villar said she found the set-up illegal.

“You give permits for farmer cooperatives to benefit. It’s not supposed to be given to other people. The mere fact is that they gave these to others. And then when there are violations, it’s the farmers’ coops that get sued. The one who really benefits from importation goes scot free. That is wrong,” Villar said in an interview after the hearing.

Villar added that she was not aware this was already an “industry practice.” She said it would be up to the justice department to determine its legality and prosecute those involved.

During the hearing, Bangayan said his business is trading metal and agricultural products, including rice.

Bangayan admitted that he employed Sy on a per-project basis.

Villar said, “If we trace Willy Sy, a witness in the last investigation pinpointed him as a broker of Starcraft – that is the importer that was caught in Davao.”

The senator was referring to Starcraft International Trading Corporation, a major rice importer whose shipments were put on hold in Davao City for lack of an import permit.

Villar got Bangayan to admit the addresses of his companies, which matched with those in the incorporation papers of businesses that witnesses linked to him.  

Bangayan’s lawyer, Benito Salazar, also admitted that he is counsel for Starcraft.

This prompted Senate Majority Leader Alan Peter Cayetano to say, “You can see where this is going. There are too many coincidences, so we’re checking.”

Villar concluded: “We established the relationship between rice importation and Davidson Bangayan. That’s the intent of this committee. Whether he is David Tan or Davidson Bangayan is important to the Department of Justice.”

'COME ON.' Senate Minority Leader Juan Ponce Enrile tells David Bangayan he is lying, saying there are documents proving the businessman is the rice smuggler David Tan. Photo by Joe Arazas/Senate PRIB

Enrile to Bangayan: You’re lying

Early on in the hearing, Bangayan declared, “My name is Davidson Bangayan. I’m not David Tan.”

Yet Justice Secretary Leila de Lima presented court documents that she said bolstered the claim of the National Bureau of Investigation (NBI) that Bangayan is David Tan.  

De Lima said the documents were from a libel case Bangayan filed against Jesus Arranza, chairman of the Federation of Philippine Industries (FPI). The justice chief said that in his affidavit and attachment, Bangayan referred to himself as “aka David Tan.”

“In the affidavits they executed, witnesses said David Bangayan is David Tan, also known as DT. They said DT pays the fees required by the National Food Authority, and shoulders the airfare and accommodation of representatives of cooperatives during bidding,” De Lima added. 

“In exchange for the benefits from Tan, the cooperatives allow DT to use them as fronts in bidding [even if] DT has the discretion in the sale and distribution of rice,” she added.

Senate Minority Leader Juan Ponce Enrile is also convinced that Bangayan is Tan, saying he knew about the libel case the businessman filed against Arranza. Enrile also handed over documents about Bangayan to Villar.

Enrile told Bangayan: “Oh come on, nagsisinungaling ka dito eh! Sabihin mo na ang totoo kundi makukulong ka. Here are your names and your companies.” (You are lying. Tell the truth or you will be detained.)

Enrile also cited a complaint that the FPI received from a Singaporean firm against a company of David Tan for supposedly failing to fulfill a contract to supply scrap metal.

Enrile told Bangayan: “You’re involved in an arbitration case in Singapore. ‘Di ka pwede magsinungaling. Ikukulong ka ni Lee Kuan Yew.” (You cannot lie. Lee Kuan Yew will put you in jail.)

Arranza also testified that Bangayan sued him for libel after he mentioned the businessman’s name in the media in relation to the Singaporean case.

“In the case, no one refuted that David Tan and David Bangayan are one and the same. It’s only this time he is denying. I have nothing against the person. I am doing this only as a citizen and president of the federation to protect the interest of the industry,” he said.

Senators want to invite Duterte

In the hearing, Bangayan admitted to having a fertilizer business in Davao City but denied that his family is from there. Asked about details of his shipments and warehouse in Davao, Bangayan said he will have to check his records first.

Senator Grace Poe requested the committee to invite Davao City Mayor Rodrigo Duterte, who is tracking down alias David Tan in Davao. Duterte had threatened to kill smugglers in the city.

Villar said the committee is open to issuing an invitation to Duterte. She said the committee will continue its probe into the other smugglers named by witnesses.

Senator JV Ejercito vowed to file a bill classifying rice smuggling as economic sabotage.

Ejercito said it is not only David Tan who is behind rice smuggling, comparing him to alleged pork barrel scam mastermind Janet Lim Napoles.

‘Di ako naniwalang mag-isa lang si Bangayan. Kayo ang nadidiin, parang Napoles ng smuggling.” (I don’t believe Bangayan is the only one doing this. You’re just the one under fire, the Napoles of smuggling.) Rappler.com

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