Court asked to stop P700-M fund release to farmers

Coconut producers have petitioned the Sandiganbayan to stop the government from releasing P700 million from the so-called "coconut levy funds" to coconut farmers as ordered by President Arroyo.

Led by Zamboanga City Mayor Ma. Clara Lobregat, the Coconut Producers Federation Inc. (COCOFED) asked the anti-graft court to order the government to explain why it should not be barred from releasing the funds and how the amount would be used.

Lobregat said Mrs. Arroyo’s order to release the P700 million is a "blatant contravention" of the anti-graft court’s order of Dec. 8, 2000.

"(The order mandates) that the property under sequestration or the fruits thereof may not be disposed or even negotiated much less encumbered while they remain under sequestration for the simple reason that the properties are under custodia legis (custody of the court)," she said.

Commissioner Ruben Carranza of the Presidential Commission on Good Government said Lobregat should be blamed for any delay in the release of the P700 million.

"We have long waited for the coco levy fund to be used by genuine coconut farmers..." he said. "Because of the motion, the implementation of the program might be delayed."

However, Lobregat said numerous COCOFED members, which is comprised of coconut farmers and producers, have "signified their willingness" to join the lawsuit.

"If the (United Coconut Planters Bank), the (Coconut Industry Investment Fund) oil mills and the 14 holding companies have a surplus, the same must be declared as cash dividends to the coconut farmers who are the stock holders of record of those companies," she said.

Lobregat said those pushing for the "diversion" of the "coco levy funds" could be sued for large-scale estafa on the ground that the money is private property.

"In this regard, movants hereby respectfully reserve their right to institute the appropriate criminal complaint for large-scale estafa or plunder against the PCGG, the members of the board of directors of the UCPB and CIIF oil companies and the 14 holding companies and all other persons who participated in such patently, illegal and devious scheme."

Last month, Mrs. Arroyo ordered the P700-million to be used for health insurance, educational and other financial assistance programs for coconut farmers and their families.

Between 1973 and 1982, the money, then known as Coconut Consumer Stabilization Fund (CCSF), was collected from coconut farmers by the Marcos administration.

Later, the fund, which became known as the Coconut Industry Investment Fund (CIIF), was used to acquire shares at United Coconut Planters Bank (UCPB), COCOFED Marketing Corp., COCOFED Life Insurance Corp., and the United Coco Oil Mills Inc.

In 1983, the oil mills borrowed some P1.6 billion from UCPB to set up 14 CIIF holding companies, which also took loans from UCPB to buy shares in San Miguel Corp.

In 2002, the Sandiganbayan ruled that the funds are "prima facie public in nature" because they were taxes collected from coconut farmers.

At present the "coco levy funds" are estimated to have reached P1.30 billion.