CORRUPTION UPDATE: PLUNDER CHARGES (AT LAST)

C O N F I D E N T I A L SECTION 01 OF 02 MANILA 001641 SIPDIS STATE FOR EAP/PMBS, EB, INR/EAP USAID FOR CDOWNEY E.O. 12958: DECL: 04/08/2010 TAGS: PGOV KCOR PREL MARR ECON RP SUBJECT: CORRUPTION UPDATE: PLUNDER CHARGES (AT LAST) REF: A. MANILA 1506 ¶B. MANILA 740 ¶C. MANILA 464 ¶D. 04 MANILA 5262 Classified By: Political Officer Andrew McClearn for reasons 1.4 (b) and (d) ¶1. (C) Summary: The Ombudsman filed plunder charges on April 6 against Major General Carlos Garcia and his immediate family members, while his court martial continues. Neither case is expected to conclude soon, however. The GRP has also filed new charges against 21 officials in the Department of Public Works and Highways. Civil society is increasingly involved in anti-corruption activities, most notably with a planned "Philippine Integrity Fund" to assist with prosecutions and the Office of the Ombudsman. End Summary. -------------- Plunder! -------------- ¶2. (C) Chief Special Prosecutor of the Ombudsman's Office Dennis Villa-Ignacio confirmed to told poloff that his office had filed formal charges of plunder on April 6 in the anti-graft court (Sandiganbayan) against Major General Carlos Garcia (former Comptroller of the Armed Forces of the Philippines),his wife Clarita, and sons Ian, Juan, and Timothy. The filing of plunder charges capped a six-month investigation by the GRP into the Garcia case (refs b-d). In a supplemental notice accompanying the charge sheet, the Ombudsman stated that Garcia had "accumulated, amassed, and acquired ill-gotten wealth by himself and in connivance with the members of his family." According to Villa-Ignacio, the five-member Garcia clan has been accused of violating R.A. 7080, known as "The Plunder Act," by illegally accumulating 303 million pesos (approximately USD six million) during MG Garcia's years of service in the AFP. Villa-Ignacio related that a panel of investigators from the Ombudsman's Office had discovered ample evidence of unexplained wealth in the form of landholdings, luxury motor vehicles, and significant assets in various accounts under the names of Garcia family members. Garcia also faces four minor charges of perjury. ¶3. (SBU) According to press accounts, Clarita Garcia has now returned to the Philippines from the U.S., and the Bureau of Immigration has issued a hold-departure order to prevent her from leaving the country. In the charge sheet, the GRP recommended that the Garcia family members be detained and held without bail, noting the seriousness of the charges, i.e. the allowable punishment under the plunder act is life imprisonment or even the death penalty. As of COB April 8, police have apparently not yet detained Mrs. Garcia. It is not clear whether the sons are in the Philippines or the U.S -------------- Court Martial -------------- ¶4. (SBU) Military court proceedings continue against Garcia in parallel with the criminal trial. On April 4, DHS Attache testified to the court martial panel that Garcia is currently a legal holder of a U.S. Alien Registration card. (Note: Under the Philippine Constitution's Article XI Section 18, public officials who seek to change citizenship or to acquire immigrant status in a foreign country shall be "dealt with by law." end note) The prosecution has vowed to wrap up its case by April 22, after which Garcia's defense will begin. The maximum penalty is dishonorable discharge from the AFP and a forfeiture of AFP retirement benefits. -------------- Other Developments -------------- ¶5. (C) Other significant public and private sector developments in the ongoing effort to reduce corruption since Mission's last summary in Ref B are: -- The House Committee on Natural Resources on March 16 created an oversight group to probe questionable local government management of the lucrative quarry operations in Pampanga Province, located northwest of Manila. Vice Governor Joseller Guiao earlier had accused current governor Mark Lapid and his predecessor (and father) -- now Senator Manuel Lapid -- of skimming close to USD seven million from the quarry operations from 1999 to 2004; -- Secretary Angelo Reyes of the Department of the Interior and Local Government (DILG) asked the Ombudsman to file criminal charges against two Bureau of Customs officials allegedly involved in smuggling at the Batangas International Container Port. Reyes, who also heads the National Anti-Smuggling Task Force (NASTAF),accused Customs collectors Napoleon Morales and Marius Anderson of violating the Anti-Graft and Corrupt Practices Act; -- The Ombudsman's Office on March 8 filed graft charges against 21 officials of the Department of Public Works and Highways, accusing the group of participation in a USD 750,000 vehicle repair scam in 2001. This new set of charges came shortly after the Sandiganbayan dismissed earlier, more serious, charges of "plunder" against the same 21 officials; -- The Makati Business Club and the Philippine Bar Association announced on April 6 that they would launch the "Philippine Integrity Fund" on May 5. This fund's aim is to provide a "donation mechanism" for private law firms and businesses to channel monetary contributions and volunteers into the public sector, especially to the Ombudsman's Office. Several private lawyers are already providing pro bono work to support prosecutors in this office on high-profile cases. Visit Embassy Manila's Classified SIPRNET website: http://www.state.sgov.gov/p/eap/manila/index. cfm You can also access this site through the State Department's Classified SIPRNET website: http://www.state.sgov.gov/ Mussomeli