Senator bares DBP's alleged illegal $90-M loan to Ongpin firm

Senator Serge Osmeña III on Thursday revealed that the Development Bank of the Philippines (DBP) in 2008 illegally approved a $90-million (P3.8 billion) loan to a company controlled by controversial businessman Roberto Ongpin. In a statement released Thursday, Osmeña alleged that the DBP released the money to Ongpin-controlled Global Air Services (GAS), which was allegedly not licensed to do business in the country and had a capitalization of only $2. The senator, who chairs the Senate committee on banks and financial institutions, said the DBP approved the loan in December 2008 "despite the absence of a loan application and applicant." GMA News Online tried contacting the present DBP leadership about the issue but the Office of the Legal Counsel under the the DBP's Office of the President and Chief Executive Officer said that they are not authorized to comment on the matter. Osmeña said GAS used the $90-million fund to buy securities related to the Metro Rail Transit (MRT), including those held by two other companies linked to Ongpin - Ashmore and Presidio. “This is criminal, outrageous and utterly brazen, with the participants casually breaking several laws as if they do not exist. They used public money to buy assets for themselves and from themselves. It is Philex all over again," Osmeña said. Osmeña said he would delve deeper into the GAS deal when the Senate resumes on Monday its inquiry into the P660-million loan granted to Ongpin through the company Delta Ventures Resources Inc. (DVRI) in 2009. “While this transaction is revolting, I welcome it because they became too cocky and reckless," he said. Earlier, the Senate banks and blue ribbon committees found that the old DBP board allegedly "sidestepped" existing regulations of the Bangko Sentral ng Pilipinas just to accommodate the P660-million loan to DVRI. Osmeña said that DVRI was granted at least 10 exemptions so that the loan would be immediately approved. Ongpin, however, had already denied that the deal was tainted with irregularities. During the previous hearings, it was revealed that the DVRI asked DBP to register the 50 million shares of Philex Mining Corporation bought using the DBP loan to Golden Media, Ongpin's other firm which eventually sold the shares at a higher price to Two Rivers, a firm affiliated with business mogul Manny Pangilinan. During that time, Ongpin and former DBP chair Reynaldo David were on the board of Philex. Earlier, the Commission on Audit (COA) had said that there might be possible fraud and insider trading in the deal. However, David denied that he had prior knowledge that the price of Philex shares would surge after the stocks were sold to another company. - VVP, GMA News