HGC execs told: Answer graft raps

MANILA, Philippines - The Office of the Ombudsman has ordered seven ranking officers of Home Guaranty Corp. (HGC) to answer graft charges filed in connection with the sale of a state property in Port Area, Manila.

HGC is one of several housing agencies President Aquino has put under the supervision of Vice President Jejomar Binay.

Ordered to explain their side on the alleged anomalous deal were Gonzalo Bongolan, president; Elmer Cadano, executive vice president; Melinda Adriano, vice president, guaranty group; Rafael de los Santos, vice president, asset management group; Corazon Corpus, vice president, corporate services; Danilo Javier, vice president, legal services; and Jaime Sarona, vice president, management services.

Bongolan has reportedly refused to turn in his courtesy resignation despite the President’s call for heads of state corporations and other presidential appointees to resign to give him a free hand in reorganizing the bureaucracy.

In a three-page order, the Ombudsman’s office said it found “enough basis to proceed with the preliminary investigation” of the graft charges against the seven HGC officials.

It also “found enough basis to proceed with the administration investigation of the case.”

A copy of the order was sent to reporters covering the House of Representatives, where several lawmakers want an investigation of the alleged irregular deal.

Jerome Canlas, an official of construction firm R-11 Builders filed the graft charges against the housing officials.

In his complaint, Canlas said the HGC officers sold a 2.8-hectare property located in Vitas, Tondo, Manila to La Paz Milling Corp. on July 21, 2008 for P384,715,800, or around P13,000 per square meter.

He claimed that the property was sold below its fair market value.

“At the time of the sale, the property was worth between P506,205,000 and P694,224,000 based on sales offers and independent appraisal of market values of adjacent and adjoining properties,” he said.

He said in 1999, Philippine National Bank sold a lot near the HGC property for P22,000 per square meter.

Based on the PNB selling price, HGC should have sold its large lot for at least P636 million, he said.

He pointed out that HGC should have acquired a price better than P22,000 per square meter, considering the “usual appreciation of real estate properties.”

Canlas noted that EValue Plus, a professional appraisal company, valued the HGC lot and neighboring areas in June 2008 at P24,000 per square meter.

“The difference between the actual fair market value of the subject properties and the actual purchase price (for the HGC lot) is from P121,489,200 to P309,508,200,” he said.

That is the amount that HGC lost from the sale of its lot, he said.

“Clearly, the transaction was grossly disadvantageous to the government,” he stressed.