August 29, 2001, Agence France-Presse, Graft charges sought for ex-SSS chief, 13 others,
Posted: 0:09 AM (Manila Time)
THE PHILIPPINES' senior graft prosecutor was asked on Tuesday to indict 14 senior officials of state-pension fund Social Security System (SSS) for allegedly defrauding the government out of about 1.1 billion pesos (21.5 million dollars).
A group of complainants alleged that the 14 SSS officials—including ex-SSS chief Carlos Arellano, former labor secretary Bienvenido Laguesma, and SSS chief actuary Horacio Templo—bought overpriced shares of the Philippine Commercial and International Bank (PCIBank) in 1999.
The SSS teamed up with another bank, Equitable Bank, which acquired PCIBank.
The complainants are a group of SSS officers pushing for reforms within the organization and filed the application with ombudsman Aniano Desierto, whose office handles all graft cases against government officials.
They said the 14 officials approved the purchase of more than 25 million common shares of the PCIBank at 290 pesos each, which was overpriced by about 45 pesos. "This translates to a total of 1.1 billion pesos (in padding) for the shares. This overprice represents the damage the SSS suffered from the transactions," the complainants said.
The complainants said the SSS officials caused "injury" to the state pension fund by "entering into a transaction manifestly disadvantageous to the SSS as well as the government" and for approving an "unlawful, inequitable or irregular transaction."
There is no time frame for when Desierto has to respond to the plaintiff's application.
Last month, the senior executives led a strike that resulted in the ouster of Vitaliano Nañagas, who was installed by President Gloria Macapagal-Arroyo in January to replace Arellano to institute reforms in the pension fund.
Before he stepped down, Nañagas said he had discovered that the fund lost "billions in pesos" through questionable investments under the administration of jailed president Joseph Estrada.
The losses were discovered by an independent auditing firm, which also submitted the results to the presidential palace and government's independent corruption watchdog.
Apart from the purchase of PCIBank shares, Estrada was also believed to have earned millions in kickbacks allegedly for ordering former SSS president Arellano to make the investment, officials had said.
Estrada has been detained by authorities since being ousted in January over charges of massive corruption and could face the death penalty if convicted.