DOJ names prosecutors in criminal raps vs Pichay, LWUA execs

Justice Secretary Leila de Lima has named the panel of prosecutors that will conduct the preliminary inquiry into the criminal complaint filed against Local Water Utilities Administration (LWUA) board members and their chair, former Surigao del Sur Rep. Prospero Pichay. In Department Order No. 289 issued on April 18, De Lima assigned Senior Assistant State Prosecutors Rosalina Aquino and Aileen Marie Gutierrez, and Assistant State Prosecutor Edna Valenzuela to the panel. A preliminary investigation is conducted to determine whether there is probable cause to file the appropriate case before the proper courts. Earlier this month, Finance Secretary Cesar Purisima said the government lost about P480 million in 2008 when the LWUA board acquired a bankrupt Laguna thrift bank controlled by the Gatchalian family. Malversation of public funds is punishable under the Revised Penal Code. The other respondents named in the complaint were LWUA board members Renato Velasco, Susana Vargas, Bonifacio Maria Peña Sr., and Daniel Landingin. LWUA is a government-owned and -controlled corporation as a specialized lending institution for the promotion, development, and financing of local water utilities, and as depository of the reserves for capital improvement of local water utilities. "The LWUA Board willfully misused and dissipated public funds to acquire a financially troubled and failing bank, and in the process, bailed out the Gatchalian family from an unprofitable investment at the expense of LWUA and the national government," read Purisima's complaint. Purisima said Pichay and other members of the LWUA board of trustees should be held liable for the alleged irregular acquisition of 60 percent of the outstanding shares of cash-strapped Express Savings Bank Inc. (EXSBI), which has suffered deficiencies since 2005. In his complaint, Purisima questioned the LWUA's infusion of P480-million in the "financially-troubled" bank using money from the government coffers. "These offenses have arisen from the direct and willful participation in facilitating the highly irregular and anomalous takeover and acquisition of the shares of stock of EXSBI, a financially troubled bank undergoing rehabilitation, in wanton violation of pertinent banking laws and rules and at a gross disadvantage to LWUA and the national government, resulting in the dissipation and misappropriation of public funds in the amount of at least P480-million," the 35-page complaint stated. — Sophia Dedace/RSJ, GMA News