Executive pleads not guilty on anti-dummy law charges

MANILA, Philippines - An executive of investment firms Philippine Investment One and Philippine Investment Two, accused of allegedly representing the business interests of the Lehman Brothers in the country, has pleaded not guilty to violation of the Anti-Dummy Law.

Edilberto Castañeda entered his not guilty plea during the arraignment of the case on Aug. 25 before Presiding Judge Edwin Sorongon of the Mandaluyong Regional Trial Court, Branch 214.

Sorongon gave Castañeda’s co-accused Carlos Mañalac and Norman Macasaet five days to explain their absence during the scheduled arraignment. The Ilonggo judge threatened to order the arrest of Mañalac and Macasaet should they fail to submit their explanation.

The three executives are accused of allowing themselves to be used as dummies of the Lehman Brothers for the latter to own parcels of land in the Philippines.

The criminal charges arose from the complaint by businessman Vic-Vic Villavicencio, who found out that his land previously mortgaged with Equitable Bank was subsequently acquired on March 28, 2005 by Philippine Investment Two, a company wholly owned by Lehman Brothers. While the accused raised in their defense that at the time the land was acquired, 60 percent of the equity of Philippine Investment Two was owned by a Filipino corporation. Villavicencio submitted that the same was merely a scheme employed to evade nationalization laws.

Records showed that the alleged 60 percent equity allegedly came about one week before the acquisition and that a close examination of the corporate lawyer points to Lehman as beneficial owners. Lehman Brothers is a global financial services firm that recently filed bankruptcy in New York.

Villavicencio clarified that per evaluation of the case there are other business executives that might be impleaded in the case as there are circumstances showing that they have been somehow part of the said scheme.

According to Villavicencio’s lawyer, Allan Gepty, the Anti-Dummy Law penalizes Filipinos who permit aliens to use them as nominees or dummies to enjoy privileges reserved for Filipinos or Filipino corporations. It also prohibits aliens from intervening in the management, operation, administration, or to control nationalized business, whether as officers, employees or laborers, with, or without remuneration.

If convicted, Castañeda, Mañalac and Macasaet, can be sentenced from not less than five years to 15. – Non Alquitran