Witness recants on fertilizer overprice

One of the witnesses in the P728-million fertilizer scam recanted her statement yesterday on the overpricing of fertilizer distributed to beneficiaries in the provinces in 2004.

Deonilla Gregorio, who heads Feshan Philippines, retracted her testimony last Dec. 22 that the selling price of the fertilizer was P600 per bottle and that she received P50 million from Leonicia Llarena as proceeds from the sale of fertilizer.

But her recantation only bolstered charges of a cover up of the overpricing of 90,092 bottles of fertilizer, a transaction totaling P13.5138 million.

Gregorio also got P500,000 cash for fertilizers Feshan delivered four years ago.

Last December, Gregorio testified that the payment to Feshan for fertilizer stocks was increased from P50 million to P105 million.

It was only later that she found that the money deposited to Feshan’s account was P152.77 million from March 9, 2004 to Jan. 31, 2006.

In her supplemental sworn affidavit, Gregorio said she feared for her life, her family’s and that of her employees which was why she was “constrained” to submit an “erroneous statement and testified in a less truthful manner.”

She cited the killings of Marlyn Esperat and other people who were privy to the fertilizer scam as reasons why she was forced to lie on her first statement.

She then told the Senate that she actually sold the fertilizer at only P150, instead of her earlier claim that she sold it at P600 per bottle.

Another witness, Maritess Aytona, contradicted Gregorio’s claims of overprice, insisting that it was Feshan that actually put the price of P1,500 per bottle.

Despite intense questioning from Blue Ribbon committee chairman Sen. Richard Gordon, Aytona contradicted the claims of Gregorio and former Land Bank of the Philippines bank manager Malaine Baui that she (Aytona) was present when the bank account was opened sometime in March 2004 at the LBP Elliptical branch in Quezon City.

Baui pointed to other witnesses, Marilyn Araos and Llarena, as the people present when Feshan opened a bank account at the LBP.

It was Araos who was designated as sole signatory of the account, but Araos maintained she was only made signatory and that she had nothing to do with the transactions that happened thereafter.

Araos initially confirmed that she was only following the instructions of fertilizer scam conduit Jaime Paule, who threatened her that she would not be able to get the one-percent commission for their transactions in Region 4 if she refused to do so.

“Initially, I refused (to consent to the opening of the account) because I don’t know Feshan,” Araos said.

Araos then invoked her right against self-incrimination, which caused an exchange of barbs between Gordon and her lawyer Adresito Fornier, who were classmates at the Ateneo Law School.

Fornier got Gordon’s ire when he tried to talk to Araos in the middle of the Senate hearing. Both Gordon and Fornier also debated over the invocation of the right against self-incrimination, which Gordon said can only be made during custodial investigations and not in Senate hearings.

In the middle of the hearing, Araos also testified it was Paule who directed her to open a regular savings account for Feshan.

Araos said she never withdrew any money, but admitted that she had signed at least four blank checks upon the instructions of Gregorio.

More denials

Paule vehemently denied any role in the fertilizer scam in which he was believed to have brokered fertilizer supply contracts between Feshan and the Department of Agriculture.

He said he was not involved in any transaction with the DA even as witnesses – Aytona, Llarena and Araos – pointed to him as a major participant in the fertilizer scam.

The Senate witnesses have pointed to Paule, who is the only person who could have a link to former agriculture undersecretary Jocelyn “Jocjoc” Bolante.

Paule and Bolante met yesterday at the hearing but both have denied knowing each other.

In his testimony, Paule denied any link with the National Organization for Agricultural Enhancement Inc. (NOAEI), a proponent of the DA’s P728-million fertilizer fund, and any link with Feshan.

Paule also denied a claim by agriculture undersecretary Belinda Gonzales that he met Bolante at the New World Hotel in 2002.

Paule admitted knowing Aytona and that they had met on certain occasions. On the contrary, Aytona said she had known Paule since 1999. She also reiterated that it was Paule who hired her as consultant for Feshan.

As this developed, two new witnesses surfaced at the Senate - Joey Flordeliza, president of the NOAEI, and businessman Natalio Castillo – who testified that Paule tried to broker the fertilizer deal with them on separate occasions.

During their conversations, Paule dropped the name of Bolante.

Bolante’s frozen accounts

Gordon lashed out at the Anti-Money-Laundering Council (AMLC) for not informing the committee that a freeze order on Bolante’s bank accounts lapsed last Dec. 20.

Gordon said senators were “deeply shocked” when they learned about it from newspaper reports.

Senate President Juan Ponce Enrile, Lacson, and Gordon agreed this should prompt the Senate to review or amend the Anti-Money Laundering Law, and maybe soften procedures under the Bank Secrecy Law.

He asked AMLC executive director Vicente Aquino why he did not inform the committee about the expiry date of the freeze order when he attended a committee hearing last Dec. 10.

Aquino explained that there was no request for the Senate to be informed of such.

“AMLC is a financial intelligence unit. I was not asked by the chairman or any member of the committee, that’s why I was not able to answer or disclose the expiration or expiry date of the freeze order,” Aquino said.

Irked by the reply, Gordon said: “You don’t have to be asked.”

Gordon’s Blue Ribbon committee conducted the last hearing on Dec. 22 last year or two days after the supposed freeze orders were lifted.

Bolante confirmed to the committee that the freeze order on his accounts had lapsed and showed a court certification as proof.

Of the 32 “unfrozen” accounts, Bolante said he only had four accounts.

He also admitted before the committee that he was able to withdraw some amount from the accounts but invoked the Bank Secrecy Law when pressed further by Lacson on the issue.

Aquino said there was never a lapse on their part, as before the expiration of the freeze order, he had already recommended the filing of civil forfeiture case.

Aquino confirmed that on Jan. 5, 2009 he wrote the banks that the freeze order had already expired and they should be guided accordingly.

“It means they should be guided by the rule (that they should ask for confirmation from AMLC before releasing the accounts). We complied with the rule,” he said.

In a press statement he issued last week, Aquino said banks should not lift the effects of a freeze order without securing official confirmation from them, as provided for under Rule 10.5 of the council’s revised implementing rules and regulations.

He said the letter he sent to the concerned banks last Jan. 5 – or 15 days after the freeze order expired on Dec. 20, 2008 – was intended to remind them of this procedural requirement.

Meanwhile, the investigating panel tasked by the Office of the Ombudsman to probe Bolante is expected to come out with its results next week.

Reacting to the Senate’s criticism of the Ombudsman’s failure to act immediately on the case, Assistant Ombudsman Jose de Jesus Jr. said the investigating body has until Jan. 30 to finish its job.

The Court of Appeals had already decided to lift its freeze order on Bolante’s bank accounts, overtaking the conclusion of the Ombudsman’s investigation.

“It is premature to disclose the outcome at this time as the panel is yet to submit its recommendation to the Ombudsman,” De Jesus said. – With Michael Punongbayan