Prosecution team in tax credit scam replaced

MANILA, Philippines – The Office of the Ombudsman has replaced the prosecution panel handling cases involving the multimillion-peso tax credit scam filed against former officials of the Department of Finance at the Sandiganbayan.

In her Office Order No. 72 received by the Office of the Special Prosecutor last July 23, Ombudsman Ma. Merceditas Gutierrez replaced the members of the special panel on the cases pending before the fourth and fifth divisions of the anti-graft court.

While Special Prosecutor Dennis Villa-Ignacio still stands as lead counsel for the prosecution, all six members of the panel that has been handling the cases were replaced.

The new members of the panel are: assistant special prosecutors Rohermia Jamsani-Rodriguez, Ma. Hazelina Tujan-Militant, Jennifer Agustin-Se, Agnes Autencio Daquis, Mariter Delfin-Santos and Roland Galvan.

“All matters pertaining to the said cases shall be treated with confidentiality. The Special Prosecutor is hereby directed to submit a monthly written report to the overall deputy ombudsman who is designated official to monitor the development,” Gutierrez said in her order, a copy of which was obtained by The STAR.

Villa-Ignacio lamented the decision of Gutierrez to pull out his prosecutors who have been handling the cases at the anti-graft court.

“I don’t know what their intention was in pulling out our prosecutors who are very familiar and competent in these tax credit cases, especially at this crucial point,” he told The STAR.

Villa-Ignacio suspects that the replacement of his team in the special panel handling the controversial tax credit scam cases “may be part of the harassment on me.”

“But I already told the courts that I will continue to be lead prosecutor in these cases that are as important as the plunder case against former President Estrada,” he assured.

Villa-Ignacio has been accusing Gutierrez of harassment to get him out of office by clipping his powers by all means. The Ombudsman and her deputies already denied this allegation.

The Office of the Ombudsman filed the cases involving the tax credit scam in November 2003 and these are now pending before the fourth and fifth divisions of Sandiganbayan.

Accused of graft and falsification of public documents were former DOF undersecretary Antonio Belicena, former deputy executive director Uldarico Andutan Jr., tax specialists Raul de Vera and Rosanna Diala and Columbus Philippine Bus Corp. employees Amelia de Dios and Joseph Cabotaje.

Prosecutors said the DOF officials, who were all members of the One-Stop Shop Inter-Agency Tax Credit and Drawback Center, conspired with De Vera and Diala to grant the bus firm a P5-million tax credit certificate even if the firm was not qualified or legally entitled to avail of tax credit.

The tax credit certificate (TCC) was issued on the basis of the bus company’s purchase of six Mitsubishi non-air-conditioned Fuso units at a reported cost of P28 million in June 1997. The certificate had been issued even if the documents presented for the TCC application were found to be spurious and falsified and that the purchase prices for the buses were overstated.

Investigation showed that Columbus was not entitled to any TCC, since its units were bought from a dealer and not from a domestic manufacturer, which is required under the Investment Code of 1987.

Probers said the DOF officials approved the application despite the glaring and obvious discrepancies.

In August 2003, Belicena, Andutan, review officer Asuncion Magdaet, evaluator Melrose Tordesillas and Lorna Gamboa, secretary and manager of garment firm Texasia Inc., were indicted after prosecutors said they connived to defraud the government of P2.1 million.

Graft investigator Marydel Jarlos-Martin made the recommendation, which was approved by Villa-Ignacio on the basis that the DOF officials had unity of purpose in granting a P2.1-million TCC to Texasia without the benefit of thorough scrutiny.

An investigation conducted by the National Bureau of Investigation (NBI) showed that the supporting papers were either forged, non-existent or were receipts issued to other companies falsified to look like Texasia was the applicant.

The anti-graft court ruled last April 30 that one of the accused, businessman Homero Mercado of the Jam Liner Bus Co., could not turn state witness in exchange for testifying against his co-accused since he failed to offer anything vital to the government’s case.

Mercado is facing two counts of graft and two counts of falsification of public documents.

Probers found that Jam Liner was able to draw P7.35 million worth of tax credits on Jan. 4, 1996 based on a spurious claim that the firm acquired 10 bus units at the cost of P40.94 million at P4.094 million per unit from the Philippine Automotive Manufacturing Corp.

Investigation revealed that the buses were only worth P2.35 million each and were actually bought from Diamond Motors Corp. Investigators said that Diamond is a dealer and not a domestic manufacturer. They said the transaction should have been disqualified.