This, according to Solicitor General Jose Anselmo Cadiz, who has been assigned to lead the DBP in prosecuting Ongpin and other “conspirators.” He said Ongpin’s transactions would fall squarely in the Supreme Court’s definition of a “behest loan” and speculative insider trading.
Cadiz is working closely with lawyers Zenaida Ongkiko-Acorda and Jose Manuel Diokno who were earlier deputized by the Office of the Solicitor General (OSG) to handle the case.
“The real question is whether DBP officials violated banking laws and its own rules to engage in speculation, using state funds when the DBP’s thrust is medium and small industries, and not to depend on the value of shares.” Cadiz said.
“The government will definitely go after those who appear to be the most guilty,” he said.
Another action the OSG may take, according to Cadiz, is to seek legal remedies to forfeit the income derived from the transactions in favor of the government.
Cadiz dismissed Ongpin’s allegations that the government was engaged in a witch-hunt in going after perceived allies of the Arroyo administration.
“There are diversionary tactics that do not confront the issue frontally. It cannot be called a witch-hunt because clearly, something wrong has been done and we are merely correcting it since documents show that the DBP and Ongpin violated the law,” Cadiz stressed.
Based on his initial review of the case, Cadiz said, the P660-million loan to Delta Ventures Resources Inc. (DVRI) maybe considered a behest loan since the borrower is undercapitalized, and the loan was under-collateralized.
He also noted the extraordinary haste in which the loan was released, aside from the fact that Ongpin has admitted himself that he is a friend of former first gentleman Jose Miguel Arroyo.
He noted that the previous DBP Board approved the loan, although DVRI was undercapitalized with only P625,000 in paid-up capital and with reported losses of P98 million and retained earnings of negative P2.3 million. DVRI loans were under-collateralized, as confirmed by DBP’s internal auditors.
“The finding of the DBP that DVRI obtained behest loans has basis in fact and law: DVRI was under-collateralized and undercapitalized; Ongpin was known closed to the Arroyo administration; and DBP approved the loan in an extraordinary speed,” he said.
The DBP has filed criminal and administrative cases against its past board led by Chairman Patricia Santo Tomas, President Reynaldo David, and former Trade Minister Ongpin over P660 million in loans that the bank had granted to an Ongpin company to finance his acquisition of Philex Mining shares.
The complaint before the Ombudsman also named former DBP Chief Operating Officer Edgardo Garcia and former Directors Ramon Durano IV, Alexander Magno, Floro Oliveros, Joseph Pangilinan, Miguel Romero, Franklin Velarde and Renato Velasco among the respondents.
Ongpin has denied the accusations saying his loans were all aboveboard.
