Supreme Court of the Philippines

SC upholds dismissal of graft complaint vs ex-Marcos officials

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SC upholds dismissal of graft complaint vs ex-Marcos officials

COURT OF LAST RESORT. The Supreme Court building in Padre Faura, Manila.

Angie de Silva/Rappler

The High Court notes that the Ombudsman 'did not arbitrarily exercise its bounded duty' because its ruling is based on submitted evidence

MANILA, Philippines – The Supreme Court (SC) has affirmed the dismissal of the graft complaint against former Cabinet secretaries of the late dictator Ferdinand Marcos and several others in relation to an alleged $20-million behest loan granted by the Philippine National Bank to a young company in 1980.

In a 16-page decision, the High Court’s First Division denied the petition of the Presidential Commission on Good Government (PCGG) claiming that the Office of the Ombudsman committed grave abuse of discretion in dismissing its complaint in relation to section 3 (e) and (g) of Republic Act No. 3019 or the Anti-graft and Corrupt Practices Act against the former government officials and Marbella Club Manila, Incorporated executives.

Cleared were the late Roberto Ongpin who was trade minister at the time, former tourism minister Jose Aspiras, former PNB president Panfilo Domingo, former PNB senior vice president Gerardo Aguigo, and former PNB executive vice president Domingo Ingco; and Marbella officials Bernardo Vergara, Federico Salcedo and Merle Jean Deen officials.

The decision was penned by Associate Justice Ramon Paul Hernando, with concurrences from associate justices Rodil Zalameda, Ricardo Rosario, Jose Midas Marquez, and Maria Filomena Singh.

The case stemmed from the $20-million alleged behest loans granted by the PNB to Marbella, only six months old at the time, in 1980 for the construction of a tourism resort.

On August 24, 2012, the Ombudsman dismissed the PCGG’s case and denied its motion for reconsideration on October 9, 2012.


The SC said affirmed the Ombudsman’s ruling that based on facts and evidence, there was no probable cause to warrant the indictment.

“The Ombudsman found no proof of manifest partiality, evident bad faith, or gross inexcusable negligence on the part of the respondents, not a contract entered into to the great disadvantage or prejudice of the Philippine government; hence, no liability under Section 3 (e) and (g) of Republic Act No. 3019 attached to respondents,” the SC said.

The High Court added, “The Ombudsman’s determination of probable cause does not resolve the accused’s guilt or innocence but evaluates whether the evidence presented before it would engender a well-founded belief that a crime has been committed or that the accused is probably guilty of committing said crime.”

The Ombudsman’s decision was anchored on its evaluation of evidence were it was revealed that Marbella was not a fictional corporation. Based on the findings, the company was registered under the Securities and Exchange Commission with a subscribed capital of P37.5 million.

The SC also noted that the Ombudsman “did not arbitrarily exercise its bounded duty” because its ruling was based on submitted evidence.

“Accordingly, this Court upholds the principle of non-interference with the investigatory and prosecutorial powers of the Ombudsman absent any showing of grave abuse of discretion on its part and of the established exceptions for this Court to do so,” the SC said. 

While Marbella was only six months old in April 1979, the National Investment and Development Corporation (NIDC), a subsidiary of PNB, approved the request of Marbella to issue a Letter of Guaranty in favor of Europe-Asia Finance Corporation or any other financiers to guarantee foreign credit in the principal amount of $20 million.

When the deal did not materialize, Marbella applied for a $20-million loan with the PNB which the government bank approved on September 1, 1980.

The PCGG claimed that the PNB approved the loan even before Marbella became the registered owner of the land where the resort was to be built. –

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