Elections: Money + Power
FOR THE 2013 midterm elections, a company called the International Global Mining Exchange (IGME) donated P5 million to the campaign kitty of deposed President Joseph Estrada's Pwersa ng Masang Pilipino (PMP).
After winning the mayoralty seat of Manila, Estrada plucked IGME’s former president from his post at the Department of Public Works and Highways (DPWH) and appointed him as the new City Engineer of Manila.
IGME was PMP’s second highest donor last elections, with its P5 million trailing only businessman William Tiu Gatchalian’s P10-million donation.
As city engineer, Roberto Bernardo administers, coordinates, supervises, and controls “the construction, maintenance, improvement, and repair of roads, bridges, and other engineering and public works projects of the local government unit,” according to Section 477 of the Local Government Code which took effect in 1991.
Bernardo, however, bristles at any insinuation that he is now Manila’s city engineer because of IGME’s donation to Estrada’s party. According to Bernardo, it was an issue of familiarity and trust.
“The President-Mayor, he seems to know me,” says Bernardo at an interview at the City Engineer’s Office in Manila. “Even when he was still president, he knew me as a DPWH employee. We have friends, Senator Jinggoy (Estrada’s son) is a friend, and we don’t have negative track record. Perhaps they thought that I can help here in Manila, so President-Mayor Joseph Estrada requested (for me).”
“I'm here on detail,” he adds. “It’s like DPWH lent me to the City of Manila to help in the engineering here. My item is still Assistant Regional Director but I have the document that the department detailed me here and the mayor designated me as OIC City Engineer. While I am here, I have no commitment/connection with (my last assigned post) Region IV-A.”
But IGME’s donation and Bernardo’s subsequent appointment may run afoul of several laws, both election and civil service regulations. To begin with, the Omnibus Election Code, Batas Pambansa 881, prohibits those involved in the mining industry and other extractive sectors from making contributions to an election campaign.
Article XI Section 95 prohibits campaign contributions from “natural and juridical persons operating a public utility or in possession of or exploiting any natural resources of the nation.”
Second, Bernardo registered IGME in 2011 as its president, director, and incorporator at a time when he was also assistant regional director of the DPWH Region IV-A, or the Calabarzon area. The company’s incorporation papers filed with the Securities and Exchange Commission (SEC) showed that Bernardo owns a fifth of IGME.
Section 7 of Republic Act 6713, or the Code of Conduct for Public Officials and Employees, regulates outside employment of government personnel. Under the law, such employees are not allowed to take on second job unless that job “will not conflict or tend to conflict with their official functions.”
At the regional level, DPWH regional directors are allowed to approve projects of up to P150 million within their districts. While IGME operates under the DPWH Region III regional office, Bernardo’s position as Assistant Regional Director of Region IV-A could have given him considerable clout and influence among his peers in the DPWH. The connection is interesting because the mining and ore transport sector is heavily reliant on road and bridge infrastructure, which is one of DPWH’s primary functions.
To be fair, Bernardo has relinquished his position with IGME; in the 2012 General Information Sheet submitted by IGME to the SEC, Bernardo has been replaced as president of the company – by his 25-year old son, Raphael Earvin Bernardo.
Bernardo says he sees no conflict of interest issue with his and his family’s involvement in IGME. He says the company does not transact or enter into contracts with the government, thus his connection with IGME does not affect his work at the DPWH.
“On your statement that there is a conflict of interest, I also asked several people with regard to corporations like this,” Bernardo says. “We do not have any contracts here (with DPWH). There is no contractor relationship, so my assignment in Region IV-A will not in any way interfere or have a conflict with our port in Pangasinan.”
Bernardo also argues that IGME is not prohibited from making a campaign donation because it is not really a mining company, but a port operation company.
“The nature of the company is port operations that cater to nickel,” he says. “If you relate that to the law with regards to exploiting (resources), it is just a transport area. We are not exploiting. The company does not have a hand except as a shipment point for the mined ore.”
“From what I know, no exploitation is happening there because anyone can use our port,” he adds. “We are not just limiting it to mined ore, any other product can be shipped from there. We do not have any control over where they get their ore or natural resources.”
Reminded that the company is called “International Global Mining Exchange,” Bernardo says he named it that way in order to attract investors. “In truth, we just gave it the mining brand, maybe in order to attract clients,” he says. “But the actual performance of IGME is not that. We are not into mining.”
Bernardo’s explanation, though, runs into conflict with the incorporation papers submitted by his group to the SEC in September 2011. In the incorporation papers, IGME described itself as being involved in “chromite ore mining,” with the main function of “operating mines, and of prospecting, exploring and of mining, concentrating, converting, smelting, treating, refining, preparing for market, manufacturing, buying, selling, exchanging… all other kinds of ores, metals, and minerals, hydrocarbons, acids, and chemicals.”
In addition, even if IGME really is not into mining, as Bernardo insists, it still runs into conflict with the prohibition by the Omnibus Election Code on campaign donors. As a port operation, IGME would still have to get a special permit from the Philippine Ports Authority (PPA). In fact, Bernardo admits that he had to relinquish his position as president of IGME because the PPA would not grant the company a permit to operate a port because he was also a DPWH official.
“When we were applying with PPA, they advised us that I cannot be part of the corporation,” Bernardo says. “Anyway, I was told that I can still help the company.”
“When we formed the company, I was the president, but we changed it,” he says. “Since then, I have not been involved, although there are days when I would go there to visit my son.”
Bernardo says that when his son Earvin was appointed president of IGME in 2011, the younger Bernardo was only 22. But Roberto Bernardo says his son was already capable of running the company, since most of the decisions were made by the board anyway. Also, Bernardo admits, he still oversees the operations of the company.
“(Earvin) knows how to operate (the company), he studied it,” Bernardo says. “In the decision making, although he is the president, the decision is with the board. And the chairman of the board will command the president.”
“I help with the decision making and what they have to do, because I oversee the operations and they report to me,” says Manila’s new city engineer. “When I have suggestions, they also listen to me.”
Bernardo even acknowledges that he was consulted by IGME on the idea of donating to the PMP’s campaign kitty. But the final decision, he says, was made by IGME’s chairman of the board, former San Rafael Bulacan Mayor Jaime S. Viceo III.
“The real politician in the group is Mayor Viceo, he was the one who decided as the chairman of the board,” Bernardo says. Viceo, Bernardo adds, was the one in IGME who personally knew Mayor Joseph Estrada.
Viceo also ran for vice-mayoralty position last elections in San Rafael under the United Nationalist Alliance (UNA), of which PMP is part, but lost.
Bernardo says he was asked by his son Earvin about his opinion on the idea of donating to the PMP. He recalls his son telling him, “Daddy, the corporation will be making a donation.”
“I said, if you think we can afford to give, can we give?” Bernardo says. “When we looked at the situation, the company was earning enough during that time. So I said, we can give some help. I did not even know how much IGME was going to give.”
Interestingly, while Bernardo implied that IGME could afford to donate to the PMP, he also admitted that the company had been in hibernation since the early part of the year.
When PCIJ tried calling the IGME thru the contact number posted on its Facebook page, the number was said to be “not yet assigned.” PCIJ then called Carlos H. Chanchico, the corporate secretary who also filed the company’s articles of incorporation.
According to Chanchico, the IGME currently does not have any office, so there are no contact numbers he can provide. He said the IGME used to occupy an office in Scout Castor, Quezon City but since it has no current “shipping” (referring to operations), the company decided to close the office in April 2013, after exactly a year of stay.
Bernardo confirms that the company has no operations since the early part of the 2013. “Right now, we are not earning because nickel is so cheap,” he says. “No one is buying nickel these days, and there is a lot of nickel now in China. We stopped operations early this year, although there were operations last year.” The company, however, maintains a small office in Pangasinan, with a caretaker and a security guard.
In the course of research for this story, PCIJ found photos posted on IGME’s official Facebook page where Roberto Bernardo was still prominently featured as the company’s main man.The photos were taken during the blessing of IGME’s office in Quezon City in April 2012.
According to Bernardo, though, those were only “ceremonial” photos. – PCIJ, September 2013