Inekon board chairman details $30-M MRT extort

MANILA, Philippines - The top executive of Czech railway firm Inekon Group has submitted an affidavit to the National Bureau of Investigation (NBI), detailing an alleged $30-million extortion attempt involving officials of the Metro Rail Transit (MRT).

In a five-page affidavit, Inekon board chairman and chief executive officer Josef Husek said MRT officials led by its general manager Al Vitangcol III invited the company’s officials to an informal dinner in a Makati restaurant on July 9, 2012.

Husek stated that the dinner was attended by Vitangcol, Manolo Maralit who was introduced as a “liaison,” Wilson de Vera, and Czech Ambassador Josef Rychtar.

Previous news reports said Maralit and De Vera later became part of the consortium PH Trams-CB&T JV, which replaced Japan’s Sumitomo Corp. as MRT-3 maintenance provider in October last year. The maintenance contract was extended by a month last July.

“Contrary to our intentions, the dinner turned out to be social rather than business; we presented our new offers for the project without any result,” Husek said in the affidavit, a copy of which was obtained by The STAR.

Before the dinner ended, Vitangcol‘s group invited the Czech firm to another meeting in a “private place” to discuss the collaboration between the company and the MRT.

This second meeting took place in Rychtar’s official residence in Forbes Park. Husek, Inekon chief operating officer Milan Haloun, Maralit and De Vera attended the meeting.

Rychtar gave a recorded interview with NBI officials who visited his embassy in August, before going on his annual leave. Now back in Manila, Rychtar said he was ready to sign a written transcript of the interview in which he corroborated Husek’s story. Rychtar said the NBI could use the document as his signed affidavit.

Husek, in his affidavit, narrated, “While talking about the tender, Mr. Wilson de Vera suggested that we would be selected as (the) supplier of the tram vehicles and related services, provided that we (pay) to an unknown entity a certain amount of money. Mr. Wilson de Vera indicated such payment should amount to USD 30 million.”

“This suggestion shocked us, as we did not expect this way of doing business. We tried to explain that any paid sum would inevitably increase the final price of our products and services, because the prices (were) carefully calculated with regard to process of our subcontractors and value of the technology to be used in the project,” Husek added.

He stated that De Vera left the premises several times to “consult someone” over the phone.

“When he finally returned to the residence, he told us that according to Mr. Vitangcol the contract price for one tram vehicle (will) not exceed USD 3 million, as that is a fixed ceiling price set forth in an MRT consultancy expert report. He then told us that the sum of USD 2.5 million instead of USD 30 million indicated originally would be sufficient,” Husek said.

Inekon “refused” the proposal and left the meeting, Husek stated.

“Before we did so, Mr. Wilson de Vera encouraged us to think about his suggestion until the official meeting scheduled for the next day at MRT,” Husek said.

In the afternoon of July 10, the Inekon officials and Rychtar met again with Vitangcol in his office in Quezon City. When they arrived, Vitangol was accompanied by De Vera. A little later, Maralit arrived.

“Mr. Vitangcol asked whether we accepted the proposal put forward by Mr. Wilson de Vera the day before. Furthermore, he immediately and insistently proposed to sign an agreement establishing a joint venture of Inekon group and people suggested by Mr. Vitangcol,” Husek said.

Under the proposed joint venture, Inekon would control 60 percent of the shares, with the 40 percent held by people proposed by Vitangcol.

“Its purpose would be to assume the contract for maintenance of MRT which was soon up for renewal,” Husek stated.

When Inekon again rejected the proposal, it “upset” Vitangcol, Husek noted.

“On our way back to the hotel, Ambassador Rychtar informed us that he just received via mobile phone a text message from Mr. Maralit. In the message, Mr. Maralit informed Ambassador Rychtar that Mr. Vitangcol and Mr. Wilson de Vera were furious, because we refused to accept their suggestions. According to the message, MRT would never do any business with Inekon Group in the future,” Husek stated.

Inekon was among five companies that bought bidding documents from the Department of Transportation and Communications (DOTC) for the P3.8-billion MRT 3 expansion project. But the company wants a government-to-government deal and did not participate in the bidding.

Vitangcol returns to work

In an affidavit submitted to the DOTC, Maralit and Vitangcol denied the alleged extortion.

Vitangcol has returned to work after taking a voluntary leave of absence.

“He is already on board,” Transportation Secretary Joseph Emilio Abaya said. “After the 15 days expired, we requested him to continue... we believe that his going back to MRT won’t affect the investigation.”

Abaya has slammed Rychtar for the allegations and said Inekon should compete for the train contract.

The DOTC is conducting an administrative probe into the case. Abaya, who went to the Senate yesterday for a budget hearing, told reporters the DOTC is still waiting for the statements from De Vera and Jose “Pepe” Rodriguez, who was named in reports in another newspaper as one of those linked with Vitangcol’s group.

The P3.8-billion MRT 3 expansion project involves the acquisition of 48 new trains. Currently, MRT 3 has 73 Czech-made trains.

Husek said Inekon Group‘s corporate lawyer assisted him in drafting his statement, which was sworn to in Prague on Aug. 15. It constitutes the main complaint in the case.

The MRT 3 was built as a “build, lease, transfer” project in 1999. CKD Prague supplied the 73 trams. CKD was acquired by Siemens and then by Inekon.

For about two years now, Inekon has pushed for a government-to-government contract to provide 52 new light rail vehicles and 21 option cars as well as a refurbishing and maintenance deal for the existing fleet.

The company points out that this is pursuant to the original contract, which provides that the MRT 3 and original equipment manufacturer should undertake capacity expansion after five years. The government-to-government procurement contract will be supported by the Czech Republic’s Export Credit Agency. – With Christina Mendez