Pagcor files graft charges against its former head Genuino, other officials
The Philippine Amusement and Gaming Corp. has filed its second criminal case against former Pagcor Chairman and CEO Efraim Genuino and former officials of the agency.
This time for graft and corruption related to Pagcor’s questionable direct funding assistance of more than P34 million to the Philippine Amateur Swimming Association Inc. (PASA) beginning 2007.
Charged before the Office of the Ombudsman were Genuino, former Pagcor president/COO Rafael “Butch” Francisco, former directors Philip Lo, Manuel Roxas and Danilo Gozo, former executive vice president Rene Figueroa, former VP for Accounting Department Ester Hernandez, former VP for Corporate Communications and Services Department Edward “Dodie” King and former AVP for Internal Audit Department Valente Custodio.
In a separate complaint, sports advocates led by former Sen. Nikki Coseteng and Philippine Swim League president Susan Papa filed charges of graft and corruption, and violations of the Forfeiture Law and Anti-Money Laundering Act against the former Pagcor officials together with former Philippine Sports Commission (PSC) Chairman William Ramirez and PASA president Mark Joseph.
Lawyer Harry Roque, the group’s legal counsel, pointed out “this is not just malversation of public funds. It’s about destroying the dreams of young athletes. It’s unforgivable that money allotted by law for sports and youth development went to the private pocket of former Pagcor Chairman Efraim Genuino.”
Records show sometime in August 2007, an arrangement was reached between Ramirez, in his capacity as PSC chairman, and Genuino, in his capacity as Pagcor chairman and CEO.
PSC authorized Pagcor to deduct from its monthly remittance to the sports commission the amount incurred by PASA like food and accommodation, venue fees and other expenses for the training of national swimmers.
This is illegal since Republic Act 6847 (Philippine Sports Commission Act) states that Pagcor is required to directly remit 5 percent of its gross income to the PSC. The Commission shall in turn allocate portions of the funding assistance from Pagcor to specific national sports development initiatives, including training of national athletes by National Sports Associations (NSAs) like PASA.
On Aug.15, 2007, the Pagcor Board comprised of Genuino, Francisco, Lo, Roxas and Gozo, approved the grant of a monthly financial assistance for three years to PASA. Succeeding “financial assistance” to PASA was also approved by the Pagcor Board on Dec. 4, 2007, April 1, 2008, Feb.y 11, 2009 and May 26, 2009.
On various dates from Sept. 12, 2007 to Dec. 16, 2008, various funds totaling P34.323 million were released to PASA chargeable to PSC share. These were subsequently re-classified by Pagcor as “financial assistance.” The re-classification meant charging the amount to Pagcor’s operating expenses.
When a change in PSC leadership came in 2009, the new PSC Chairman Harry Angpin wrote Genuino to inform him that PSC is rescinding the Aug. 1, 2007 authorization issued by Ramirez to Pagcor. Genuino then discontinued direct funding to PASA.
On Sept. 23, 2009, concerned swimmers, coaches, parents, members of PASA and non-members as well formally requested the Commission on Audit (CoA) to review all funds remitted by Pagcor to PASA.
CoA then wrote Pagcor to submit documents supporting the disbursements made to PASA. In response, then Pagcor Internal Audit head Custodio submitted to CoA a liquidation report reflecting disbursements to PASA in the total amount of P31.858 million.
After a review of the submitted documents, CoA wrote Pagcor on Jan. 18, 2010 stating the following:
1. There is no basis of authority for Pagcor to release the funds directly to PASA instead of releasing to PSC as mandated by law.
2. The Liquidation Report submitted by Pagcor is not signed/approved by the authorized PASA officials.
3. Disbursements stated in the liquidation report in the total amount of P31,858,616.85 were not properly supported by documents.
Documents show that Pagcor’s financial assistance to PASA was used by the latter to pay the TRACE Aquatic Complex (TAC) in Los Banos, Laguna. The sports complex, used for the training of PASA’s swimmers, is owned and operated by the Genuino family.
Genuino was a member of the TRACE Board of Trustees from 1986 to 2003 and also its president. As of May 21, 2010, Genuino’s wife Aurora Flores Genuino serves as chairman of TRACE’S Board of Trustees, son Erwin Genuino is president, and daughter Sheryl Genuino See is chief finance officer. Although the former Pagcor CEO is no longer a member of the Board of Trustees of TRACE, Genuino’s financial interest is direct in view of the fact that his wife owns at least 48.5 percent of TRACE’S equity distribution.
Based on the receipts and documentation submitted by PASA, it paid to TRACE Aquatic Center the amount of P37.063 million using Pagcor’s financial assistance for the use of TAC sports facilities.
Meanwhile, the inclusion in the graft and corruption charges of former Pagcor board members Francisco, Lo, Gozo and Roxas was they “acted in conspiracy with Genuino in approving the monthly financial assistance to PASA knowing full well that PASA uses the TRACE Aquatic Center in Los Banos, Laguna in training its swimmers.”
On the other hand, former Pagcor officials Figueroa, Hernandez and King, and still incumbent officer Custodio were included in the charges because of their “indispensable official acts without which the release of “financial assistance” to PASA and payments by PASA of its accounts with TRACE for the use of the tatter’s Aquatic Complex facilities would not have been completed.”
The separate complaint filed by the group of Coseteng named former PSC Chairman William Ramirez as one of the respondents since he “is clearly liable for the unlawful and fraudulent disbursements by Pagcor to PASA because he aided, abetted and conspired to perpetrate the same by issuing his Aug. 1, 2007 authorization which was used as basis for the unlawful and fraudulent disbursements to PASA.”
The group also alleged that PASA President Mark Joseph was liable in the unlawful transactions because “he benefited from the disbursements, he facilitated the criminal transfer of funds from Pagcor to PASA, and he effectively ‘laundered’ the funds for the benefit of Mr. Genuino.”
According to Atty. Roque, “we have lost our competitive advantage in swimming ever since PASA became a private entity under the control of Mark Joseph. We have not won in any swimming competition since PASA is not interested in training swimmers but in becoming the laundering machine of Genuino.”
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