Gov’t men found a party to telecom firm’s ‘looting’ – Malaya 12.15.2006

BY DENNIS GADIL

GOVERNMENT nominees in the Philcomsat Holdings Corp. (PHC) were a party to the alleged multi-million looting of the corporation due to their hefty allowances and salaries, a joint Senate probe learned yesterday.

"Millions of pesos are coming out of a company that is not in the pink of health. And the PCGG (Presidential Commission on Good Government) appears not to be in control of these (government) nominees," Sen. Richard Gordon said during the hearing on the dissipation of Philcomsat’s assets.

Gordon’s committee on government corporations and public enterprises and the committee on public accountability chaired by Sen. Joker Arroyo are conducting the inquiry.

Gordon said even the PCGG admitted that it loses control over government nominees once they assume positions in sequestered firms like the Philippine Communications Satellite Corp.
(Philcomsat) and sister firms PHC and Philippine Overseas Telecommunications Corp. (POTC).

PCGG chair Camilo Sabio told the joint Senate probe: "We could not control them. Once they’re installed, they’re on their own."

"Of course, the President could fire them," he added.

At least six government nominees to PHC, Philcomsat and POTC told senators that they receive up to P150,000 a month in salaries and P500,000 for "public relations and representation" allowance.

Philip Brodett, PHC director and vice president, said he uses his P500,000 yearly "PR and representation allowance" to dine and wine friends, officers of the Securities and Exchange Commission (SEC), presidents of various companies and "newspaper people."

Brodett said lately he has been entertaining members of the media "since we have been in the news for quite some time."

"We told them about our position," he said.

Brodett, the highest-paid government nominee, draws a salary of P150,000 a month from PHC and Philcomsat.

He said he collected a 13th month bonus equivalent to three months salary or P450,000 in 2005.

He also got a housing loan from PHC worth P2 million.

He said was able to grow PHC from a P10 million company in 1996 to a P1 billion firm at present.

"Operationally, yes it’s making money," Brodett said.

He said aside from its regular revenue stream from money placements estimated to be worth P700 million, PHC also earns from a call center which is estimated to turn in a profit of P7 million this year.

Benito Araneta, PHC board chairman up to 2005, told the joint probe that he received a one-time "bonus" of $10,000 (roughly P550,000) as transportation allowance, which he used when he traveled abroad between 2004 and 2005.

Araneta has been accused of fast-tracking a "behest loan" for his cousin, businessman Antonio Araneta, worth P125 million from PHC and another P265 million from Philcomsat.

Brodett said the loan, with an interest of 9 percent, was backed by a property in Alabang, which Antonio Araneta valued at P11,000 per square meter. Brodett said the market was P20,000 per sq. m. or a total of P800 million.

Benito Araneta said the loan was actually the sale price of the property and was part of the "complicated" plan of his cousin’s Ansear company to merge with the PHC. He said Ansear needed the money to increase its capital and put it at par with the PHC in order "make the merger easy."

Gordon rebuked Benito Araneta for agreeing to the loan despite his blood relations to the borrower.

"Why would a government nominee deal with a cousin?" Gordon asked. "You gave out the loan even while the company was already struggling."

Benito Araneta told Gordon that he did not participate in the deliberations on the loan and pointed to the PCGG as the one which approved it.

Benito Araneta again earned the ire of Gordon when he said that he did not receive any summon nor invitation from the Senate committee.

"Please don’t insult the intelligence of this committee," Gordon shot back.

Gordon said the whole nation knew that Benito Araneta was the subject of a warrant of arrest for refusing to appear before the joint Senate probe.

Julio Jalandoni, Manuel Andal and Enrique Locsin also admitted receiving a P2 million housing loan and other perks as government nominees.

Roberto Abad denied receiving the bonus and other PHC perks aside from his monthly salary of P10,000.

Abad said: "If I can, I also want to get it."

Jalandoni, PHC director, said he was also given a P123,000 reimbursement by the PHC despite "rarely attending meetings."

He said he could not reject the President when he accepted the nomination despite his being busy.

He said he was drawing a P20,000 salary per month from PHC but complained of not being able to draw his allowance from Philcomsat since "they have no money."