After years of muddling through the Philippines’ “justice” system, some progress in the crackdown on pork barrel politics has finally been made. Janet Lim Napoles now reportedly faces “jail time of 12 to 18 years for each count of malversation” after the Sandiganbayan ruled “Napoles, [former Cagayan de Oro representative Constantino Jaraula], and three others […] guilty of committing three counts of graft and three counts malversation charges for pocketing at least P19.2 million of the lawmaker’s Priority Development Assistance Fund allocation”.
But is that the end of what the Philippines’ National Bureau of Investigation (NBI) described as “the mother of all scams” back in 2013? At the time, the estimate of what was allegedly stolen was nothing short of enormous. Allegations that up to Php10 billion was siphoned off by a syndicate into dummy firms rocked the foundations of both chambers of Philippine Congress back then. Linked to the scandal were no less than five senators and 23 congressmen. Was it a racket knowingly or unwittingly participated in by the 28 law makers? That still remains to be determined.
The news first broke in the Inquirer.net which over a four-part series of articles revealed the extent of the scam allegedly perpetrated by a certain Janet Lim Napoles, CEO of trading firm JLN Corporation. The series of stories ran by the Inquirer.net are as follows (key excerpts quoted for each):
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NBI probes P10-B scam (Fri, 12 Jul 2013)
JLN stands for Janet Lim Napoles, who has been identified as the alleged brains behind the racket. She runs the company with her brother, Reynald “Jojo” Lim.
The sworn affidavits—prepared by six whistle-blowers with the assistance of their lawyer, Levito Baligod, and submitted to the NBI—stated that JLN Corp., with offices on the 25th floor of Discovery Suites in Ortigas Center in Pasig City, had defrauded the government of billions of pesos in ghost projects involving the creation of at least 20 bogus nongovernment organizations. These NGOs were supposedly the ultimate recipients of the state funds, but the money went to Napoles, according to the affidavits of the six whistle-blowers.
‘I am not involved in any scam’ (Sat, 13 Jul 2013)
Janet Lim-Napoles, who first appeared on the radar screen of whistle-blowers in 2001, has dismissed as a “product of lies,” allegations she engineered a P10-billion scam over the past decade using mainly pork barrel funds of senators and congressmen for ghost projects.
In an affidavit prepared by the MOST law firm, the 49-year-old trader said she and her company, JLN Corp., had “never transacted business or closed deals with the government or any of its agencies or instrumentalities.”
“I certainly was not involved in any of the high-profile scams which occurred during the previous administration,” she said […]
How P10-B racket works (Sun, 14 Jul 2013)
The scheme involved the Malampaya funds, the fertilizer fund and the lawmakers’ allotments from the priority development assistance fund (PDAF), or pork barrel.
Napoles and her company had been trading agricultural products since 2000 until she reportedly discovered in 2003 a quicker scheme to make money, her former employees said in interviews and affidavits submitted to the National Bureau of Investigation, which is looking into her activities.
For such a high-stakes racket, the modus operandi was surprisingly simple, the INQUIRER has learned.
Napoles, who allegedly ran the racket from unit 2502 of Discovery Suites in Ortigas Center, Pasig City, established foundations or nongovernment organizations (NGOs) to serve as recipients of the funds and named her own employees, including a nanny, as presidents of these outfits.
The funds, which were deposited in the foundations’ bank accounts, were eventually remitted to her to be split between her and the lawmaker whose PDAF allotment was used, or the official of the state agency involved.
28 solons linked to scam (Mon, 15 Jul 2013)
Sen. Ramon “Bong” Revilla Jr. topped the list of lawmakers who were said to have allowed the use of their Priority Development Assistance Funds (PDAF) to the scheme allegedly hatched by Janet Lim-Napoles, president and CEO of the trading firm JLN Corp., according to the documents secured by the Inquirer.
Revilla gave the syndicate access to his PDAF, or pork barrel, to dummy NGOs formed by Napoles and registered in the Securities and Exchange Commission in 22 instances; followed by Senators Juan Ponce Enrile on 21 occasions; Jinggoy Estrada, 18 times; Ferdinand Marcos Jr., four; and Gringo Honasan, once with a small amount.
Topping the list of 23 House representatives is Rizalina Seachon-Lanete of Masbate’s third district, who allowed her pork to be used 13 times; followed by Conrado Estrella III of Pangasinan’s 6th district and Rodolfo Plaza of Agusan del Sur, both nine occasions; and Samuel Dangwa, of Benguet, eight.
Interestingly, pork barrel funds have long been seen to be an obvious source of corruption in Philippine politics. Under the pork barrel system, each senator enjoys an allocation of P200 million from the national budget while each member of the House of Representatives receives P70 million. Each one has full authority to decide how these funds are used to “assist” their respective constituencies. Because Malacañang has control over the formulation of the national budget and the release of the PDAF allocation included in the budget, some influence over the behaviour of members of Congress can be exerted by the President.
As Neal Cruz pointed out in his piece on the issue…
I am sure that President Aquino, the self-proclaimed nemesis of graft and corruption, has again submitted to Congress a budget for next year that includes the hated PDAF.
Why do the presidents do it? Because it is a means of making the legislators do what the president wants. Cooperative legislators get their pork allocations quickly; uncooperative ones don’t get theirs as quickly. The pork is a sort of carrot-and-stick for the legislators. In short, the pork is a bribe by the President to members of Congress. Because of the pork, presidents, including President Aquino, are guilty of bribery.
Clearly, this pork barrel “scam” is a product of a systemic issue within which Napoles was but one cog in a vast kleptocratic clockwork. The deeply-institutionalised thievery that is Philippine-style pork barrel politics has the following key components in its gravy train:
The President of the Philippines – who formulates the National Budget and consistently includes the pork barrel as a significant chunk of it year in and year out.
Philippine Congress – the state body that, amazingly, approves the National Budget, a big chunk of which involves the very funds that end up in its members’ secret bank accounts.
The Philippines’ financial system – a black-box conduit for mob funds that is hopelessly convoluted by archaic secrecy laws, lax and corrupt regulatory bodies, and tight family ties (many with links to the very law enforcement offices currently “investigating” this case) that greases the cogs.
Where did Napoles fit in the above?
Whatever the answer to that question is does not really matter. She is all but one item in what should have been a long list of persons of interest in this case — perhaps one that likely included bank executives, NGO managers and sponsors, senators and House representatives, and last but certainly not the least, then President Benigno Simeon “BS” Aquino III himself. The latter is where the buck stopped as the old cliche goes. BS Aquino, after all, was the man who submitted the National Budget proposal and, as such, was the ultimate originator of the pork barrel allocations to begin with. This is the very same man who back in 2010 prematurely trumpeted his place in history as the country’s unprecedented Corruption Killer. Midway through his term, it had become evident that Aquino was living up to his two-letter initials.
Grace Pulido-Tan, then chairman of the Commission on Audit, in a media conference she called shortly after releasing their audit report on Congress’s use of pork barrel funds confirmed what Filipinos had long suspected — that the national scam is deeply systemic to governance in the country and far far bigger than “the Janet Lim Napoles issue”…
Pressed to capture in one word what the special audit – on pork barrel releases from 2007 to 2009 – found, Pulido-Tan replied: “Kahindik-hindik.” In English, “Disgusting”.
Pulido-Tan said the misuse of the billions became possible because of a combination of corruption and the failure of national government agencies, lawmakers’ offices, and lapses by the Department of Budget and Management itself, which did not follow its own rules in some cases. She also said there was widespread disregard for rules that appeared loose to begin with.
Confirmed too was the role media plays in engineering confusion and misguidance in the public in order to protect politicians who happen to bask in Big Media’s favour or demonise people so that they serve as decoys and distractions to the real issues surrounding pork barrel thievery. Media watchdog Spin Busters, for one, examined the details of the COA report and noted how legislators who had worked closely with Malacañang had been conveniently left out in the “exposés” and “scoops” issued in recent weeks by the country’s major news organisations.
[Iloilo Rep. Niel] Tupas [who was chief prosecutor in the impeachment trial against former Chief Justice Renato Corona] was tagged by COA in questionable NGO deals worth P542 million along with fellow BS Aquino BFF, Joel Villanueva, now the head of TESDA. Also, Edgardo Angara, father of Sonny Angara, who won a Senate seat on the Yellow ticket last May. COA was deeply suspicious of old man Angara’s P81.55-million financial assistance to a pet NGO and a P14-million feeding program with another NGO where he’s, uhm, an incorporator. That looks like the Napoles business model: cultivate a cottage industry of paper NGOs and monopolize the pork barrel pipeline.
Funny how quickly the tables turn on the sneaky business that is Philippine “journalism” as Spin Busters observed back then…
Now that COA chief Grace Pulido-Tan let the cat out of the bag, [the Philippine Daily Inquirer (PDI) is] forced to report about the widening scope of the pork scam. Thanks to Gil Cabacungan, even if his reputation precedes him, for incessantly pitching the story about BS cabinet exec Proceso Alcala’s own meat processing operation to a PDI newsdesk that’s always looked the other way.
Don’t be surprised about the apparent PDI “news management,” one that contains the damage to Napoles and steers clear of President BS buddies. Whoever leaked the story to PDI editors (who eventually assigned the writing to the brilliant and no-strings-attached Carvajal) sure had his own news management in mind and specific, laser-focused targets for the exposé.
On exhibit was how the erstwhile “heroes” of 1980s “people power” mythology — the supposedly “free” Philippine press, and certain yellow-shirted senators and congressmen — simply could not be trusted. Thus 2013 became the beginning of the end of the credibility of Big Corporate News Media in the Philippines.
In hindsight, we did not need Janet Lim Napoles to put the “scam” in the Great “PDAF Scam” of 2013. The Priority Development Assistance Fund had always been a scam. Filipinos were just too dumb to realise it over the last three decades. Indeed, the pork barrel, like the country’s jeepney infestation, are products of short-sighted populist politics. Both are products of wrong arguments that have been allowed to win for too long by a people not exactly renowned for arguing intelligently.
It does not take political “experts” to see that the whole point in being a duly-elected legislator is to ensure that constituencies are well-represented when crafting laws. They should leave the execution of those laws (and the use of public funds to do so) to the Executive Branch. That is why said branch is named as such.
Trying to “fix pork without hurting those who really need it” is like trying to modernise public transport without abolishing the jeepney. Change always hurts. Only people who lack imagination and routinely face the future with a pathetic lack of courage aspire for painless change. And so the question remains. Will the conviction of Janet Lim Napoles really make any difference in the bigger scheme of things? I wouldn’t hold my breath waiting for the preferred answer to that question.
benign0 is the Webmaster of GetRealPhilippines.com.