Osmeña 110% sure Mike Arroyo behind DBP loan

Posted at 06/13/12 4:46 PM

Arroyo dares Osmeña to prove it

Ongpin 1,000% sure ex-FG not involved

MANILA, Philippines (3rd UPDATE) - Senator Sergio Osmeña III is "110 percent" convinced that former First Gentleman Jose Miguel Arroyo is behind the allegedly anomalous loan that a government-run bank granted to his friend, businessman Roberto V. Ongpin.
Osmeña, chair of the Senate banks committee, said he has at least two "very serious" witnesses who will prove it, but are still afraid to come out at this time.

He refused to give any clues about their identity, but indicated that they may testify in future Senate hearings on the issue.
"You want also to protect your witnesses. You don't want them to be harassed. You don't want them to be threatened," he told reporters after a hearing on the Ongpin loans on Wednesday.
After nine hearings, Osmeña said there is no doubt in his mind that the loans that the Development Bank of the Philippines (DBP) extended to Ongpin totaling P660 million were at Arroyo's behest. "110 percent," he said when reporters asked how sure he was about the allegation.
He added, however, that he has no proof of this yet on paper.

Influence over DBP
"There's a powerful official outside or a powerful person who has extreme influence over a DBP officer," he said.

"This loan could have been done at the behest of (former DBP President Reynaldo) David. But of course David takes his orders from somebody."
Ongpin used the loans, which were granted in 2009, to buy DBP's 50 million shares in Philex Mining Corp. He then sold the shares to tycoon Manuel V. Pangilinan.
Osmeña had insisted during earlier hearings that the bank could have earned more had it sold the shares directly in the stock exchange, noting that the day before DBP granted the loan, 389 million Philex shares were sold.
He raised this point again during Wednesday's hearing, aside from the alleged irregularities surrounding the granting of the loan. The senator highlighted the granting of the loan within one day and the waiving of numerous requirements, such as financial statements and thorough investigation.

Sto. Tomas: Not shocked 
During Wednesday's hearing, Osmeña asked former DBP board directors if they found anything disturbing with the loan when they discussed it in a meeting in November 2009.
"I was not shocked," former Labor Secretary and DBP director Patricia Sto. Tomas said. "These are the kinds of things that you learn about during the actual meeting itself. It's not as if you see something and you're upset about it."
Osmeña then asked: “Didn't any of the directors raise the issue of selling the DBP's shares in cash instead of letting Ongpin buy them through a loan?”
"I think what was predominant in our bank was we had a deadline of getting rid of the shares. Part of the regulations of the central bank is we could hold shares for six to nine months," said former board director Alex Magno.
Former DBP officials led by David had repeatedly insisted that the deal was aboveboard, adding that the loan was paid early and the bank even earned from it.
Osmeña is unconvinced, however. He plans to set more hearings on the loans from the DBP that Ongpin used to buy shares in other companies.
He said that if proven guilty, former DBP officials could be slapped with administrative charges. Arroyo, on the other hand, may be liable for graft and corruption for granting "unwarranted" benefits to Ongpin, he added.
"What we are objecting to is the use of government, of behest loans, to award a crony," he said.

Mike Arroyo: Prove it

Asked for his comment, Mr. Arroyo said in a text message: "Tell him to prove it. I have nothing to do w DBP. Tell him to apologize if he cannot prove it. He can also resign for maligning me."

Arroyo's legal counsel and spokesman, Ferdinand Topacio, called Osmeña's allegations "a pathetic pack of lies."

"We reiterate that Atty. Arroyo had absolutely nothing to do with the loans given to Sec. Ongpin and he never has interfered with the decisions of any government agency, instrumentality or financial institution at any time during the terms of former President Gloria Macapagal Arroyo in any capacity," he said.

"If truly Sen. Osmena is so cock-sure -- 110% is the term he used -- that Atty. Arroyo was involved, then we dare him to file cases before the proper fora against Atty. Arroyo, and then and there show his evidence and his witnesses so that they may be exposed to the cold light of truth. He should not hide behind his cloak of parliamentary immunity like a 'maricon. 'If he fails to do so, or in filing a case fails to prove the guilt of Atty. Arroyo, then he should resign posthaste, as the Senate has no need of a member who can lie like Osmena does. He should also apologize to Atty. Arroyo and the Arroyo Family for the injury his falsehoods have caused."

Ongpin '1,000% sure' no FG involvement in DBP loans

Meanwhile, Ongpin denied that Mike Arroyo had anything to do with the DBP loans. He said he does not need the former First Gentleman's help in securing loans from DBP.

"I want to state that I am 1,000% sure, not only 110%, that former FG Mike Arroyo had nothing to do with these loans. The fact of the matter is that DBP saw a good opportunity to make major profits and simply took that opportunity. It was a judgment call on DBP’s part which proved to be totally correct and in the process, earned for the bank a record profit of over P1.3 billion," he said, in a statement.

Ongpin also cast doubts about Osmeña’s "witnesses", saying they would be committing perjury if they testify.