4 ex-PCGG execs, 2 others indicted for sale of Danding’s leased jet

Four former officials of the Presidential Commission on Good Government (PCGG) and two others were indicted in the Sandiganbayan yesterday for allegedly unlawfully selling in September 1989 a rented Falcon jet of businessman Eduardo "Danding" Cojuangco.

Indicted for graft were former PCGG chairman Mateo Caparas, Commissioner Maximo Maceren, PCGG bidding committee chief Zosimo Malabanan, Commission on Audit (COA) auditor Mario Galang, Ismael Sanchez and Benito Cuevo.

Investigators of the Office of the Ombudsman discovered that the sale of the sequestered jet to Walter Fuller Aircraft Inc. did not have any authority following a prohibition issued by the Sandiganbayan, which the Supreme Court subsequently upheld.

Despite the PCGG’s failure to ascertain whether the aircraft was indeed ill-gotten, the government officials, allegedly in cahoots with the other respondents, pushed through with the sale, resulting in a loss of $7.6 million (1990 exchange rate) to the government, both in damages and legal expenses.

"The haste in which they accomplished the sale is a feat not known in regular government contracts of such magnitude," Ombudsman prober Roland Galvan said of the "one-week" sale.

"It is likewise noted that of several planes sequestered, it was only the Falcon jet which was sold," Galvan said.

In a 15-page resolution, the Ombudsman said the respondents’ argument that they acted in "good faith" is "a matter of defense which should be best left to the court to pass upon."

"Their bad faith is evident. The injury to the government is not controverted," the Ombudsman said.

Ombudsman Simeon Marcelo also approved the recommendation that former PCGG Commissioners David Castro, Augusto Villarin and Rosalio de Leon be "investigated further" to find out whether they really had "anything to do" with the case.

Marcelo directed his agency’s Fact-Finding and Investigation Bureau to conduct the inquiry.

The PCGG, being the plane’s custodian, should have been "responsible" enough and "exercised due diligence in ascertaining the ownership of the Falcon jet before resorting to a grand sale," the Ombudsman said.

The alleged "deterioration" of the jet was also not an excuse since the former PCGG officials should have known that Unichem did not own the aircraft but merely leased it for five years, from 1982 to 1987, the Ombudsman added.

After the sale, another entity, Faysound, laid claim to the sequestered property and won in a US court, forcing Walter Fuller to seek damages from the PCGG for breach of title warranty.

This suit, according to Assistant Ombudsman Ernesto Nocos, cost the government "more than $16 million."

"If they have the foresight to anticipate a suit arising out of the lifting of sequestration, they must have also foreseen that Faysound (as what had happened) would sue in the event of unauthorized sale of its property," he said.

"The record is replete with documents and circumstances which show culpability of respondents for violation of the Anti-Graft Law based on the theory of conspiracy," he said.

He added that the PCGG’s acts then really "raised eyebrows," especially after it accepted "eyes wide open" the $1.7-million repair and maintenance of the jet.