Tax credit scam: 6 DOF execs face raps

Graft charges were filed yesterday before the Sandiganbayan by Ombudsman Aniano Desierto against six officials of the Department of Finance (DOF) and three garment firm executives in connection with a multibillion-peso tax credit scam.

Charged with seven counts of graft were former Finance Undersecretary Antonio Belicena, former executive director Uldarico Andutan Jr., tax specialist Lucila Cueto, government division officer-in-charge Miriam Tasarra and evaluators Cesa Estolano Jr. and Gladys Olano.

Desierto said the six, together with Kudip Singh, corporate secretaries Cherry Melissa Manalili and Marina Abran of JK Apparel and United Apparel could be held liable in connection with the anomalous issuance of seven tax credit certificates (TCCs) worth P9.7 million to the government firms.

In a briefing, Desierto said graft probers established that the government officials issued and secured TCCs based on forged documents.

"It was established on preliminary investigation that these persons fraudulently issued and secured the TCCs on the bases of photocopies of spurious documents. The falsified documents include bank credit memos, export performance reports and bills of lading," Desierto said.

He said investigators discovered that the finance officials "simply disregarded" the usually strict requirements and that they could have "easily detected the spurious nature of the documents."

On Aug. 24 last year, 16 finance officials and employees were indicted for graft before the Sandiganbayan after they were found to have conspired with seven garments factory officials in connection with the P60-billion tax scam. They were suspended for six months without pay in February 1999.

Graft probers said they found probable cause to sue the finance officials based on the false and spurious documents, all submitted in the application for tax credits, which were issued "without legal basis." These certificates were issued in 1997.

The Office of the Ombudsman is investigating the multibillion-peso tax scam which allegedly involves the three major oil companies and several other garment firms.

Desierto said the scandal started in 1994 when then President Fidel Ramos launched the finance department's One-Stop Inter-Agency Tax Credit and Drawback Center. The scam allegedly continued until almost the end of his term in 1997.

Tax credits are granted by the government to industries that are tax-exempt such as garment and electronics firms. But investigators have discovered that some garment firms were not covered by the tax exemption.

The investigation of the 100 other companies is being conducted by the Economic Intelligence and Investigation Bureau (EIIB) in coordination with anti-graft probers. The Ombudsman investigated the case in late 1998 when the finance department sought its assistance.