A three-member panel of the Office of the Ombudsman has asked the Department of Justice to investigate 19 sugar trading firms linked to the alleged illegal switching of government-set sugar quotas for crop year 1995-1996.
The recommendation came after a five-year investigation into a P800-million sugar scam at the Sugar Regulatory Administration (SRA).
The 19 firms were alleged to have unlawfully withdrawn a total of 1,404,882 50-kilogram bags of Class "C" imported sugar from their warehouses for sale in the domestic market, the Ombudsman panel said.
These firms were identified as the following: J.C. Mall Duty Free Inc., Wrigley Phils., Warner Lambert Phils. Inc., Ever Harvest Corp., Arjan Trading Corp., Harman Foods Phils. Inc., Philippine Super Feed Corp., Duty Free Superstore Sports Unlimited, Inc., Whale Summit Corp., Sucrex Marketing Corp.,
Great Harvest Enterprises, Puregold Duty Free Inc., Coastal Carriers Inc., Vision Sugar and Molasses Corp., Sucro Commercial Trading Corp., All Asian Countertrade Inc., Southwind Sugar Corp., Columbus Foods Inc., and Monomer Trading Industries Inc.
Former President Corazon Aquino created the SRA through Executive Order 18 on May 28, 1986, to regulate the production and sale of sugar to ensure stable prices at a level reasonably profitable to producers and fair to consumers.
The SRA governing body is the Sugar Board, composed of the administrator, who is also its chairman and chief executive officer, and two members, each representing the millers and the planters. All are presidential appointees.
To meet its mandate, the regulatory agency, attached to the Department of Agriculture, adopted a market-sharing system where all producers are given an equitable share in each market class. Under the system, Philippine sugar is grouped into five classes designated by the letters A to E.
Class "A" sugar is exported to the United States. Class "B" sugar - which commands the highest price among the five classes - is available only for the domestic market.
Class "C" sugar goes to the country's reserve stocks, while Class "D" sugar is set aside for international buyers other than the US. Class "E" sugar, in turn, is allotted to export firms requiring sugar for their production.
The Office of the Ombudsman said government-set quotas can only be changed upon proper authority. But two former SRA officials - Rolleo Ignacio and lawyer Froilan Abajon - allegedly falsified documents so the 19 firms could withdraw their imported sugar and divert it to the local market.
Ignacio and Abajon served as SRA administrator and board secretary, respectively, from 1994 to 1996.
They will be charged with falsification of public documents and violation of Section 3 (e) of Republic Act 3019, or the Anti-Graft and Corrupt Practices Act, under case number OMB-0-97-1223, on the recommendation of the Office of the Ombudsman.
The Ombudsman has also recommended the filing of graft charges against three former SRA board members (Rodolfo Gamboa, Bernard Trebol and Jose Ma. Silva IV), two department managers and 23 employees and 10 big-time sugar traders over an alleged similar anomaly from 1992 to 1994.
Under the alleged scam, the sugar traders were said to have pocketed undue profit amounting to some P800 million.