MANILA, Philippines - The Bases Conversion and Development Authority (BCDA) dared yesterday the Sobrepeña-led Camp John Hay Development Corp. (CJHDevco) to open its books to show good faith in claiming it suffered financial losses, yet ironically declared cash dividends for its stockholders.
BCDA president and chief executive Arnel Casanova raised the challenge following findings that the Camp John Hay lessee’s financial statements indicated that it declared dividends for three consecutive years ending in 2000, but at the same time defaulted in settling its financial obligations because of alleged losses.
How can one report huge losses, and then pay generous cash dividends? “As stewards of state property, we cannot let such kind of duplicity come to pass without taking appropriate actions to protect public interest in this issue,” Casanova stressed.
Audited financial statements reportedly released by CJHDevco showed that in 1998, the lessee declared a total of P378 million in dividends to its stockholders, P350 million in 1999 and P200 million in 2000.
On the other hand, CJHDevco continued to refuse paying its debts which has since ballooned to P3 billion as of end-2011.
Earlier, the BCDA chief welcomed a move by the House bases conversion committee to subpoena CJHDevco’s books of accounts, saying it would once and for all establish the John Hay lessee’s actual financial conditions. The lessee has for years refused to open its books to BCDA and to the public.
Casanova asserted that CJHDevco has violated several laws while operating in the JHSEZ, including the non-filing of audited financial statements with the SEC since 2002.
“It is a good thing that the House committee on bases conversion has resolved to subpoena the books of CJHDevco to compel its officials to show the firm’s financial records to the government,” Casanova said.
CJHDevco stopped paying its lease to BCDA as early as 1997, the second year of its stay in the JHSEZ, claiming that it was experiencing operational losses.
CJHDevco is chaired by Robert John Sobrepeña, who owns Fil-Estate Corp. The Sobrepeña group also owned and managed the College Assurance Plan (CAP) and the Metro Rail Transit Development Corp. (MRTDevco). CAP has failed to give the educational benefits to its hundreds of thousands of planholders who had invested in the company for the college education of their children. MRTDevco, on the other hand, owes more than P1 billion to the Department of Transportation and Communication (DOTC).
CJHDevco has also allegedly stopped submitting its audited financial statements to the Securities and Exchange Commission (SEC) in 2002, when BCDA discovered that the company has been declaring dividends to its stockholders. “This is inconsistent with their claims of losses,” Casanova pointed out, adding “we have records to show that they have been earning while operating in the JHSEZ.”
Casanova pointed out that these violations of government regulations are the main reasons the lessee has not been able to acquire permits for operating in the JHSEZ.
“BCDA is a government agency so we require all our private partners to comply with government laws,” Casanova said, adding “We cannot grant permits to a lessee which has not been filing its income tax returns and has a string of violations to government laws.”