MANILA, Philippines – The political rival of Vice President Jejomar Binay accused him of “earning” as an incorporator of a nursing school in Makati, and supposedly using as a dummy the nephew of former Senator Joker Arroyo.
Lawyer Renato Bondal made the allegations on Tuesday, May 5, in the 19th Senate hearing on corruption allegations against Binay, but Senator Aquilino Pimentel III ordered him to produce documents to back up his claims.
Bondal branded as “illegal and anomalous” a 2003 joint venture agreement between then Makati Mayor Binay and the Systems Technology Institute (STI) to set up the College of Nursing at the state-run University of Makati (UMak). Binay represented UMak in the joint venture agreement as chairman of the university's Board of Regents.
“Why is this illegal and anomalous? I will show that the joint venture is unnecessary,” Bondal said.
Bondal said that 40% of tuition and fees collected went to UMak, another 40% to STI, but the balance of 20% went to ophthalmologist Jack Arroyo, nephew of the former senator and human rights lawyer. The elder Arroyo is an ally and friend of the Vice President, and has been critical of the long-running Senate inquiry.
Bondal pointed out that “Jejomar C. Binay” and Jack Arroyo were among the incorporators of Philippine Healthcare Educators Incorporated (PHEI), a company created under the joint venture agreement to collect tuition and other payments from the college.
“Jack Arroyo is a doctor of medicine. He is an ophthalmologist. He has no connection to nursing schools, but he was given a 20% in the joint venture? Why? Because Doctor Jack Arroyo is a dummy of Binay. That is the logical answer,” Bondal said.
Bondal cited the General Information Sheet of the company to say that Binay has a 1% nominal share in PHEI. Binay's critic said that among the other incorporators of PHEI were UMak president Tomas Lopez and businessman Eusebio Tanco of STI.
The lawyer also cited data from the Securities and Exchange Commission (SEC) that the total cash dividends of PHEI was P106 million ($2.38 million).
Yet Pimentel, the Senate blue ribbon subcommittee chairman, asked Bondal to establish a “paper trail” to prove that Arroyo was Binay's dummy.
“Please substantiate your allegations. [Arroyo] is a doctor and businessman,” Pimentel said.
Bondal is among those who filed the first plunder and graft complaint against the Vice President in July 2014 over the allegedly overpriced Makati City Hall parking building. He is a long-time political rival of Binay.
It was Binay's chief critic, Senator Antonio Trillanes IV, who first made public Bondal's latest allegations on Monday. Trillanes agreed with Bondal that Binay should be held liable for being an incorporator in PHEI.
Trillanes requested that Jack Arroyo be invited to the next hearing on May 11. He also asked that the Commission on Audit probe the P1.2 billion ($27 million) nursing building, calling it overpriced.
The opposition standard-bearer, Binay is the leading candidate for the presidency in 2016, while Trillanes is a vice presidential aspirant from the administration-allied Nacionalista Party. Trillanes openly admits that the hearings are meant to derail Binay's presidential ambitions.
Photo by Mark Cristino/Rappler
'STI is computer, not nursing school'
Binay's spokespersons said that the Vice President never got shares or remuneration from PHEI. They added that Binay resigned from the UMak board in 2010.
“The Vice President merely represented the City of Makati in the Joint Venture Project as evidenced by the city council resolutions and ordinances. He never held any business interests therein in his own capacity,” said lawyer Rico Quicho, Binay's spokesperson for political concerns.
Another Binay spokesperson, Joey Salgado, did not answer Bondal's question on whether or not the Vice President declared the share in his Statement of Assets Liabilities or Net Worth (SALN) or divested himself of the interests.
“Let them prove it is illegal,” Salgado told Rappler. “That's the difficulty with giving people like Bondal credence after he admitted that he only guessed the price of the supposedly overpriced birthday cakes in the first hearing.”
Yet Bondal questioned Binay's need to enter into a joint venture agreement with STI without public bidding.
“STI is a computer and IT school, not a nursing school,” he said.
The lawyer pointed out that other local government-run nursing schools do not enter into deals with private entities, and had tuition way cheaper than that of UMak College of Nursing.
“The tuition in the Umak College of Nursing is almost the same as that of private schools. On its website, UMak admits that commercial rates apply. The prices are for private schools,” Bondal said.
Bondal compared UMak College of Nursing with the Pamantasan ng Lungsod ng Maynila. He said that for first year students, the tuition in PLM is only P7,000 ($156.9) while in UMak, the tuition reached P30,000 ($672.4).
The lawyer also questioned the performance of UMak College of Nursing students in the November 2014 board exam. Bondal said that PLM had a passing rate of 98% and ranked 2nd, while UMak only had a passing rate of 67% and ranked 92nd nationwide.
“Ang performance ng mga estudyante, 'di nag-i-improve, pero ang kita nila tuloy-tuloy,” Bondal said. (The performance of students do not improve but their earnings keep increasing.)
Makati 'trailblazer in PPP?'
In a statement, UMak president Lopez said that the university tied up with STI because it established Grow Incorporated, a nurse placement company in the United States. As for Arroyo, Lopez said he is the former president of American Eye Clinic, which provides “training in cutting edge health care facilities to its nursing students.”
Lopez argued that the joint venture even benefited Makati as it paid the city P42 million ($940,000) in dividends and over P70 million ($1.57 million) in rental, utility fees, and general education faculty services to nursing students.
Salgado said that the joint venture was even a “trailblazer.”
“As early as 2003, the city already explored the partnership with the private sector. We were the first local government educational institution to partner with companies under the dual license education system, and this College of Nursing was a spinoff from that. This is Makati's approach to tertiary education. We cannot dictate on other local government units,” Salgado said.
Trillanes scoffed at the defense of Binay's team. He said Binay is liable for conflict of interest, graft, and tax evasion.
The senator said that this time around, Binay can no longer hide behind dummies or say that he was not directly linked to the anomaly.
“He made a mistake here. His name is clearly in the documents. Makati pays for the scholarship of students. Who gets the money? They do. VP Binay is the partner here. It's not the city of Makati that totally owns this.” – Rappler.com