SETBACK IN GARCIA GRAFT CASE

C O N F I D E N T I A L SECTION 01 OF 02 MANILA 002712

SIPDIS

STATE FOR EAP/PMBS, EB, INR/EAP, INR/B

E.O. 12958: DECL: 06/14/2015
TAGS: PGOV PREL PINR KCOR ECON RP
SUBJECT: SETBACK IN GARCIA GRAFT CASE

REF: A. MANILA 1641


B. 04 MANILA 5262

C. MANILA 2578

Classified By: Economic Officer Daniel Duane for
Reasons 1.4 (b) and (d).


1. (C) Summary: The recent ruling in the corruption trial
of former comptroller of the Armed Forces of the Philippines
(AFP) General Garcia that his wife cannot be charged as a
co-conspirator poses a serious threat to the prosecution's
case. Though the prosecutors intend to appeal the ruling,
all the way to the Supreme Court if necessary, and remain
hopeful that they will ultimately prevail, this latest
development represents a setback and could seriously delay,
if not prevent, a conviction in what the country's top
corruption prosecutor considers a "must-win" case. End
Summary.


2. (C) On June 6, Ombudsman Simeon Marcelo told DOJ Attach
and Econcouns that a recent court ruling in the trial of
General Carlos Garcia, the former AFP comptroller accused of
"plunder" (ref A),poses severe challenges to the
prosecution's case. The three-judge panel of the
Sandiganbayan, the Philippines' anti-graft court, which is
hearing the case against Garcia, ruled that Garcia's wife
Clarita could not, as the prosecution had requested, be
charged as a co-conspirator, but only as an
accessory-after-the-fact, and the court on that basis refused
to issue an arrest warrant for her as a co-conspirator.

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Dearth of Evidence
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3. (C) Marcelo explained that, despite all of the evidence
gathered to date showing the magnitude of Garcia's
unexplained wealth (ref A),the prosecution has had
difficulty developing evidence proving Garcia's corrupt acts.
Virtually all of the deposits to his accounts were made in
cash, eliminating any paper trail. No witnesses have come
forward to testify against him. The prosecution has gathered
ample evidence that Garcia's unexplained assets are well over
the 75 million peso (approximately US$1.4 million) threshold
required to charge him with the capital offense of "plunder."
But the only piece of direct evidence the prosecution has
been able to develop thus far to prove corrupt acts is the
letter from his wife to US authorities, written in an attempt
to retrieve the approximately $100,000 in cash seized by
DHS/ICE officials at the San Francisco international airport
when his sons failed properly to declare it upon arrival (ref
B). In the letter, Mrs. Garcia admitted to the receipt by
her husband of large "gratuities" paid to him in his capacity
as AFP comptroller to secure lucrative contracts.


4. (C) Under Philippine law, statements made by a
co-conspirator, even if hearsay, are admissible. However, if
the panel's recent ruling that Mrs. Garcia cannot be charged
as a co-conspirator stands, the letter would be inadmissible
hearsay.

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Judicial Tampering?
--------------


5. (C) Marcelo said that the panel clearly erred in ruling
that Garcia's wife was not a co-conspirator. Marcelo noted
that he himself had received death threats by anonymous
callers warning him that if he pursued the case against
Garcia's family he would be killed, and implied that one
explanation for the court's legal error was that the judges
had been intimidated by similar threats.

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Ombudsman to Appeal
--------------


6. (C) Marcelo said he intended to appeal the panel's
ruling. He noted that as a procedural matter he first
planned to file with the Sandiganbayan panel, within the
week, a motion for reconsideration, which he expected the
panel to deny. He would then appeal the ruling to the
Supreme Court, which he was confident would overturn the
panel. Though he could not predict how long the appeal
process would take, he noted that a similar appeal in another
case had taken eight months.

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Garcia Refuses to "Sing"
--------------


7. (C) Some within the GRP had expressed optimism when
Garcia was first arrested that he might, in a bid for
leniency, implicate other corrupt GRP officials, but this has
not happened. Marcelo explained, by way of analogy, how he
had been told by another AFP officer facing corruption
charges that, "if I testify against them, they will kill me
and my family. If I don't, I may be convicted, but I will
not be executed, my family will be safe, and they will even
be provided for while I am in prison." Marcelo added that
"they" are "like the Mafia."

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Comment
--------------


8. (C) Failure, and even significant delay, in obtaining a
conviction in the high-profile case against General Garcia
would represent a major setback for the Arroyo administration
in her declared war on corruption. Such a setback would
certainly lead to even greater disillusionment among the
citizenry, many of whom already doubt the sincerity of her
campaign, particularly in the wake of recent allegations of
corruption against the first family (ref C). The Ombudsman's
suspicions of judicial intimidation, as well as the
difficulties in developing evidence posed by the "code of
silence," also illustrate the uphill battle faced by
prosecutors in the Philippines in obtaining convictions
against powerful corrupt officials. The failure of the
Ombudsman's prosecutors to obtain independent evidence of how
General Garcia was able to plunder is also disappointing, if
not surprising. We will continue to support the GRP's
efforts to pursue a conviction in the Garcia case.
MUSSOMELI