Plunder charges dropped vs Arroyo execs, Napoles in Malampaya scam

MANILA, Philippines – The Office of the Ombudsman has dropped plunder charges against two former Cabinet officials of the Arroyo administration and Janet Lim-Napoles in the P900-million Malampaya fund scam.

Instead, the Office of the Ombudsman filed before the anti-graft court Sandiganbayan 97 counts each of graft and malversation against Napoles, former budget chief and incumbent Camarines Sur First District Representative Rolando Andaya Jr, and former agrarian reform secretary and now Mayor Nasser Pangandaman of Masui City, Lanao del Sur.

The downgraded charges were the result of the motions for reconsideration appealing their earlier indictment for plunder

The Ombudsman  cleared former president now Pampanga Representative Gloria Macapagal-Arroyo in December 2016, along with former executive secretary Eduardo Ermita for “insufficiency of evidence” to prove they conspired with the rest for the illegal diversion of the fund or that “they deviated from the regular procedure.” 

Why not plunder?

The Ombudsman said in the resolution signed on August 30 but only released to the media on Friday, December 8, that it stands by its findings that Pangandaman got P75 million in kickbacks from Napoles, while his finance officer then, Teresita Panlilio, got P56.5 million. (READ: Malampaya scam worse than fertilizer fund scandal)

However, “it became apparent upon review that said amounts were amassed by Pangandaman and Panlilio only though one transaction," the Ombudsman said in its resolution.

"Estrada v Sandiganbayan teaches that in order to give rise to the crime of plunder, the amassing, accumulating or acquiring of ill-gotten wealth should be through either a combination or series of the acts described as Section 1(d) of Republic Act 7080,” it added.

The special panel was composed of prosecutors Maricel Marcial-Aquendo, Jefferson Toribio, Anjuli Larla Tan-Eneran, Voltaire Africa, Expedito Allado Jr, and approved by Morales.

The case involves P900 million sourced from the Malampaya fund to help in the rehabilitation of areas ravaged by Typhoons Ondoy and Pepeng.

In October 2009, Arroyo issued Executive Order (EO) 848 authorizing the use of the Malampaya fund "for purposes as may be directed by the President of the Philippines."

The Malampaya fund consists of royalties collected from operations of the Malampaya gas and oil fields in the waters off Palawan province.

In expanding the use of the fund, Arroyo also authorized Andaya to release funds from the Malampaya proceeds to the Department of Agrarian Reform (DAR) as implementing agency. 

That P900 million would eventually be funneled through Napoles-run non-governmental organizations (NGOs) in a scheme similar to the pork barrel scam, where public funds were siphoned through fake NGOs tapped for ghost projects.

There are 97 counts of graft and malversation because 97 local government units (LGUs) supposedly received the aid.

The Ombudsman also reiterated that the kickbacks to Pangandaman and Panlilio were given “on several occasions."

The special panel still considered the disbursement of the P900 million as a single transaction because “it was all part and parcel of one process/transaction only.” 

Role of Andaya 

Andaya welcomed his downgraded charges, and said he would finally get his day in court.  "I welcome the filing of the case, confident that at the end when my side will be fully heard and the evidence I submit will be appreciated, truth will prevail and I shall be acquitted of the charges against me,” said the Deputy Speaker.

Andaya is charged because he signed the Special Allotment Release Order (SARO) “fraught with irregularities constituting badges of fraud," said the special panel.

“Before a SARO can be issued, there must be a supporting document detailing how such fund will be used….However, the SARO signed by Andaya released the P900 million to the Department of Agrarian Reform (DAR) without any detail on how such funds will be used,” it said. (READ: 'No more cash' left of Malampaya fund)

Andaya explained that the Department of Budget and Management (DBM) only came into the picture only in November 2009. He said that if it is true that Napoles had been giving kickbacks to DAR officials, it had been happening even before so he couldn’t be part of any conspiracy. 

The Ombudsman panel said Arroyo’s EO 848 approved the release of funds from the Malampaya funds “subject to applicable laws and budgeting, accounting, and auditing rules and regulations.” 

The panel also said the same EO directed the DBM to authorize the implementing agency to open a Special Account in the General Fund.

The P900 million was eventually “commingled” with DAR’s Agrarian Reform Fund “in direct contravention with the said provision of EO 848.”

Whistleblower Ruby Tuason was also charged with 97 counts of graft and malversation. Tuason had invoked immunity as she was a state witness, but the Ombudsman said she was only discharged as state witness in the pork barrel scam, and was not protected from other suits. 

The others filed with the same charges are former budget undersecretary Mario Relampagos, former undersecretary Narciso Nieto and director Teresita Panlilio of DAR; former Candaba, Pampanga mayor Rene Maglanque, Jo Christine Napoles, James Christopher Napoles, Reynald Lim, Evelyn de Leon, Ronald Francisco Lim, Ronald John Lim, Eulogio Rodriguez, Simplicio Gumafelix, John Raymund de Asis, Rodrigo Galay, Alejandro Garro, Paquito Dinso Jr, Gerald Apuang, Napoleon Sibayan, Winnie Villanueva, Angelita Cacananta, and Ronald Venancio.

The P900 million scam is a small part of the overall P38-billion Malampaya funds that had been misused, according to a special report by the Commission on Audit (COA). 

The COA is calling for a criminal investigation against officials of the DBM for “laxity” in the release of these funds that contributed to the alleged misuse. – Rappler.com

Lian Buan

Lian Buan covers justice and corruption for Rappler. She is interested in decisions, pleadings, audits, contracts, and other documents that establish a trail. If you have leads, email lian.buan@rappler.com or tweet @lianbuan.

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