HOUSE PANEL PROBES LAND BANK EXECS ON DPWH PROJECT PAYMENTS
The House Committee on Appropriations chaired by Rep. Rolando Andaya Jr. (1st District, Camarines Sur) began its probe on officials of the Land Bank of the Philippines on suspicious cash deposits amounting to at least P81 million.
The inquiry was prompted by the discovery of the House panel that millions of pesos in Department of Public Works and Highways (DPWH) projects were paid to Aremar Construction Corporation, a firm partly-owned by Department of Budget and Management (DBM) Secretary Benjamin Diokno’s son-in-law, Romeo Sicat Jr.
“In today’s hearing, we expect the representatives of Land Bank to explain why did they not report the suspicious bank transactions involving Aremar Construction,” Andaya said.
In his opening statement, Andaya explained that the House is in possession of bank deposit slips that show at least P81 million was deposited to the bank account of Aremar by construction firms that won contracts from the DPWH.
The transactions are covered by the provisions of the Anti-Money Laundering Act (AMLA) as each deposit slip breaches the P500,000 transaction amount that triggers alert in the banking community.
Under the AMLA, banks are obligated to report to the Anti-Money Laundering Council (AMLC) if a deposit is made in excess of P500,000 in one banking day. The AMLC is in turn mandated to make an inquiry on the deposit.
But in his testimony before the House panel, AMLC Executive Director Mel Georgie Racela revealed that their office did not receive reports of these transactions from Land Bank.
"In the case of the Aremar account, how can we expect AMLC to inquire on the bank transactions that we mentioned if Land Bank failed to report them as mandated by law?" Andaya said.
For his part, Land Bank Assistant Vice President Domingo Galsim shared to the committee that the Sorsogon branch of Land Bank handled the transactions in question, and the branch officials should be invited to address concerns of the panel.
Andaya further noted that the non-reporting is suspicious due to the fact that the Aremar bank account falls belongs to a politically exposed person (PEP).
A PEP is an who is or has been entrusted with a prominent public position in the Philippines with substantial authority over policy, operations or the use or allocation of government-owned resources; a foreign state; or an international organization.
Also categorized as PEPs are immediate family members, close relationships, and associates who are reputedly known to have joint beneficial ownership of a legal entity or legal arrangement with the main or principal PEP; or sole beneficial ownership of a legal entity or legal arrangement that is known to exist for the benefit of the main or principal PEP.
"Hindi namin matanggap kung hindi nag-report ang Land Bank. Hindi namin matatanggap iyon dahil we comply with those PEP regulations. Now if we find out that the Land Bank Sorsogon branch is remiss in that duty, parang hindi tabla ang laban," Andaya said.
The hearing was conducted on the basis of House Resolution 2104, which calls for an inquiry in aid of legislation on the legal basis and possible effects of the shift from an obligation-based to a cash-based budgeting system as proposed in the 2019 national budget.
Moreover, Andaya underscored his refusal to bow to the pressure to rush the inquiry and the approval of the 2019 budget.
"I will bring this House down. Pure and simple, if we pass this without thinking, I will bring everybody down… Had we not discovered this, it would have been business as usual at the DBM and the DPWH," Andaya said.
Photo from Rolando "Nonoy" Andaya Jr. Facebook page