DOJ to file syndicated estafa suit vs real estate developer, 4 others

(Updated 5:30 p.m.) The Department of Justice (DOJ) has recommended the filing of a syndicated estafa case against real estate developer Delfin Lee, president and chief executive officer of Globe Asiatique Realty and Holdings Corp, and four others. Acting on the first of the four syndicated estafa complaints in connection with the firm's alleged involvement in housing anomalies, the DOJ found probable cause to indict Lee, his son Delfin Lee, Globe Asiatique officers Christina Sagun and Cristina Salagan, and PAG-IBIG Fund employee Alex Alvarez. In its 50-page review resolution, the DOJ recommended no bail for the respondents as syndicated estafa is a non-bailable offense. Once convicted, and offender may face a penalty of life imprisonment. The DOJ 's Task Force on Securities and Business Scam lent credence to allegations that the respondents conspired with one another in a "ghost borrowers" scheme that supposedly defrauded the government of about P6.65 billion. Under the fraudulent scheme, Globe Asiatique supposedly used fictitious buyers to secure loans from PAG-IBIG Fund (Home Development Mutual Fund) for the Xevera housing project in Mabalacat, Pampanga. The DOJ's review resolution, furnished to the media on Wednesday, was prepared by Senior Deputy State Prosecutor Theodore Villanueva and approved by Prosecutor General Claro Arellano, the government's chief prosecutor. As of posting time, GMA News Online was still trying to reach the respondents' lawyers for comment. Lee has repeatedly denied that his company was involved in anomalous transactions. While it recommended the indictment of Lee and four others, the DOJ cleared respondents Ramon Palma Gil, Lerma Vitug, Tintin Fonclara, Geraldine Fonclara, Revelyn Reyes, Rod Macaspac, Marvin Arevalo, Joan Borbon, Christian Cruz, Rodolfo Malabanan, Nannet Haguiling, and John Tungol. The three other syndicated estafa complaints against Lee and his alleged cohorts are still at the preliminary investigation stage. The complaints were filed by the National Bureau of Investigation, Pag-IBIG Fund, the Housing and Urban Development Coordinating Council (HUDCC), and other private complainants. "Special buyers" scheme In 2008, Globe Asiatique entered into a Funding Commitment Agreement (FCA) with Pag-IBIG for its Xevera housing project in Mabalacat, Pampanga. However, an investigation by the NBI showed that of 9,951 alleged Pag-IBIG borrowers in the Globe Asiatique deals, 1,000 could not be located, 400 housing loan applications were denied, and 200 had incomplete documents for the transaction. Some of the buyers were allegedly fake members of Pag-IBIG, and others were ineligible for membership. Another group of buyers used spurious loan accounts. The NBI's probe showed that Lee made false representations and submitted fake documents to secure the loan. The NBI also discovered that 1,000 buyers were only fictitious after finding out that Globe Asiatique used fake tax identification numbers (TINs), marriage contracts, and identification cards for them. DOJ's findings In its findings, the DOJ said that the documents used were indeed fake. "It was established by evidence that GA violated said warranties because, contrary to representation, it was discovered that the documents it submited concerning the existence and qualifications of its buyers proved to be spurious and/or questionable," said the 50-page resolution. The DOJ gave weight to the testimonies of witnesses Francisco dela Cruz and Veniza Santos Panem, who said that Globe Asiatique employed the "special buyers" arrangement. Special buyers are those who are not yet PAG-IBIG members, but were allegedly paid by Globe Asiatique to apply for PAG-IBIG membership. Once their memberships are accepted, the special buyers' accounts will be then used to take out housing loans from PAG-IBIG for units in the Xevera housing project. "Evidence on hand shows that effective August 2010 and until present, GA failed and continuously failed to remit to [PAG-IBIG] the monthly housing amortizations of its borrowers for the Xevera projects in Pampanga, to the damage and prejudice of the complainant [PAG-IBIG]in the amount of P6.65 billion more or less," the DOJ said. Elements of syndicated estafa present The DOJ then said that Delfin Lee, his son Dexter, Sagun, Salagan, and Alvarez conspired with each other in the fraudulent scheme. It added that Lee is liable for syndicated estafa because he signed the agreements with PAG-IBIG for and on behalf of Globe Asiatique. "We are without option but to turn down his defenses, i.e. that he acted in good faith in signing the agreemetns, and that the corporation has a personality separate and distinct from its officers...," said the DOJ. The younger Lee was also found liable because "he had knowledge and/or had direct participation in the aforementioned 'special buyers' scheme." As for Sagun and Salagan, the DOJ said that the two Globe Asiatique officials "could have prevented the commission of the herein fraud if only they exercised their functions diligently and in a prudent manner." “But they failed and in fact, they participated in the fraudulent scheme," the DOJ added. The DOJ then said Alvarez of PAG-IBIG "knew, participated and consented to the illegal scheme perpetrated by respondents Delfin and Dexter Lee, Christina Sagun and Cristina Salagan." The department also found that all elements of syndicated estafa were present in the scheme allegedly employed by Globe Asiatique. These elements are:

There were false pretenses, fraudulent acts, or fraudulent means. (E.g. using fictitious names, falsely pretending to possess power, influence, qualifications, property, credit, agency, business or imaginary transactions, or by means of other similar deceits);

False pretenses, fraudulent acts or menas were executed prior to, or simultaneously with the commission of the fraud;

The offended party (in this case, PAG-IBIG Fund) relied on was thus induced to lose its money or property;

As a result of which, the offended party suffered damage;

The whole crime of estafa was committed by a syndicate consisting of five or more persons formed with the carrying out the unlawful or illegal act, transaction, enterprise or scheme resulting in the misappropriation of funds solicited by corporations/associations from the general public. The complaint used to be handled by a five-member team of prosecutors led by Senior State Prosecutor Emilia Victorio. The panel recommended that the lesser offense of estafa be slapped on the respondents. However, Prosecutor General Claro Arellano wanted a review of the panel's resolution. Thus, the matter was referred to Senior Deputy State Prosecutor Theodore Villanueva for review. The review resolution then found probable cause to indict Lee and four others for the non-bailable crime of syndicated estafa. Villanueva is the officer-in-charge of the DOJ's Task Force on Securities and Business Scam. — LBG/KBK, GMA News