Questionable bond floats

When lawyer Alan Paguia made the statement that the almost P13 billion losses of the Home Guarantee Corporation (HGC) is bigger than the P10 billion PDAF scam, he was not joking. In fact, he has hailed those responsible for the plunder of HGC funds to the Ombudsman for plunder and graft.

Paguia has asked Ombudsman Conchita Carpio-Morales to look into the CoA reports asking the Home Guarantee Corporation (HGC) to account for its three bond flotation which were reportedly used to finance Delfin Lee’s controversial housing projects.

Paguia has filed graft and plunder charges before the Ombudsman against HGC president Manuel Sanchez, and his immediate predecessor, Gonzalo Benjamin Bongolan.

In his complaint, Paguia told the Ombudsman that the act of the two officials resulted to “huge financial losses” by the HGC and which now “cast doubt” on its ability “to provide a viable shelter program for the homeless and under privileged sectors of society.”

Citing COA audit reports from 2009 to 2011, Paguia told the Ombudsman that from the more than P9.8 billion “accumulated deficit” left behind by Bongolan, the figure ballooned further to P12.771 billion as of 2011 under Sanchez.

HGC issued a combined P22 billion worth of debt papers also known as zero-coupon bonds in three batches—2002 (P7 billion), 2004 (P3 billion) and 2007 (P12 billion).

Between 2009 and 2011, Paguia said “mismanagement” by the two officials also resulted to HGC’s accumulated losses of some P1.9 billion.

According to Paguia, he was compelled to file this case because he was worried that these abuses happening at the HGC may end up forgotten and neglected.

Paguia noted that HGC is mandated by its charter to operate a credit guaranty program in support of the government’s effort to promote housing ownership by providing risk guarantees and fiscal incentives for housing credits coming from financial institutions.

According to COA auditors, Bongolan illegally increased HGC’s investments on private shares of stocks and bonds from P3 million to P734 million, then used part of the interest income from these investments to reward himself and other HGC officials some P9.349 million in ‘Monetary Incentive Award’ (MIA) which is contrary to civil service rules.

In the case of Sanchez, it was alleged that HGC’s accumulated deficit ballooned further to P12.771 billion as of 2011 from the P9.8 billion left behind by Bongolan.

COA also questioned the HGC’s retirement plan approved by Sanchez totalling some P120.73 million, the  “car plan” for HGC officials costing some P28.163 million, among others.

Titles of the HGC’s acquired assets valued at more than P7 billion, the COA said, were not consolidated in the name of the HGC “thereby depriving the HGC of the opportunity to sell and recover from these properties.”

The HGC under Sanchez also did not protect and preserve some 11,903 housing units “resulting in further destruction, fast deterioration and further loss of possible income due to illegal occupants.”

Finally, some 67 percent, equivalent to more than P958 million in the HGC’s account receivables have been long due thereby casting doubt as to their collectivity.

Alfa new officers

The Arellano Law Faculty Association (ALFA) will hold the oath-taking ceremonies for its officers on April 24, 2014 at the Arellano University School of Law (AUSL) in Pasay City.

The new set of officers are Henedino Brondial, president; Vic Eleazar, vice-president for internal affairs; Ed Villena, vice-president for external affairs; Fiscal Noemi Macababad, secretary; Judge Caridad Cuerdo, treasurer; Agnes Santos, auditor; Mary Ann Reyes, PRO; and board of trustees Reynaldo Lopez, Ruben Ladia, Crisostomo Uribe, Fiscal Nelson Salva, and Atty. Oswald Lorenzo.

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