How the PCGG lost its most important New York criminal case against the Marcoses

Wednesday August 02, 2017 ()

PCGG Jovito Salonga
(Jovito Salonga, first chairman of the PCGG)

The Presidential Commission on Good Government (PCGG) embarrassingly lost its most important criminal case in the US under the Racketeer Influenced and Corrupt Organization Act (RICO) against the Marcoses in New York when it failed to present three vital state witnesses who would have linked Mrs. Imelda Marcos to the alleged crime.

Many people do not know that the RICO case arose from the purchase of four New York buildings and the Samuels collection of arts and paintings.

How the PCGG lost its most important New York criminal case against the Marcoses

These buildings, at 40 Wall Street, at 57th Street and 5th Avenue, at 6th Avenue and 34th Street and at 200 Madison Avenue, were acquired by the Marcoses between 1981 and 1983 for $187 million or P3.533 billion based on the average exchange rate of $1 to P19 during that time.

Businesswoman Gliceria Tantoco, a friend of Mrs. Marcos, bought the Samuels collection for $4.95 million.

Tantoco and brothers Joseph and Ralph Bernstein were the three vital state witnesses who were given immunity from criminal and civil prosecution in exchange for their testimonies in court against the Marcoses.

According to former PCGG Chairman and Senate President Jovito Salonga, the Bernsteins were the administrators of the four buildings, and they dealt directly with Tantoco, Rolando Gapud and the Marcoses themselves.

Surprisingly, they were not presented on the witness stand. Only the 300,000 documents received as evidence and the 95 witnesses, who testified and described alleged unscrupulous activities, were presented during the trial.

Not only that, the Aquino administration miserably lost the buildings without recovering a single centavo of the P3.533 billion when the banks foreclosed the properties after it failed to remedy the mortgage obligations, which had accumulated during the trial of the Marcoses.

A Marcos crony, noted for his propensity in the use of guns, money and women during the martial-law years, had threatened to kidnap the grandchildren of Tantoco, thus preventing her from testifying against the Marcoses.

The crony had successfully infiltrated Aquino's Cabinet by planting a woman who seduced one of its trusted Cabinet members.

The woman, married but separated, eventually became the Cabinet man's mistress. With the help of this man, the group's tentacles spread to the courts, to the PCGG and to the Office of the President.

When Aquino created the PCGG, she did not also clarify its objective as to whether it was to operate under the rule of law (Constitutional) or under the rule of men (revolutionary).

At that point, she was unaware that the highly sophisticated legal and financial system used to obscure the so-called ill-gotten wealth would require the use of a writ of confiscation rather than a writ of sequestration. In fact, a law on confiscation was readily available. Surprisingly, it was not used.

In a writ of confiscation or seizure, as explained by former Assistant Solicitor General Cesario del Rosario, the burden of proof is on the owner or possessor of goods or assets (as is done in smuggling cases), while, in a writ of sequestration, the government must not only preserve the assets but it must also present proof before a competent court that they were indeed illegally possessed or acquired.

As a result, the recovery of stolen wealth, instead of orderly, became a frenzied search for the spoils by some greedy and incompetent PCGG officials and volunteers who inordinately used the power of the EDSA Revolution to conduct raids without due regard to the rule of law.

These volunteers, known initially as fiscal agents, numbered more than 1,350. They were issued mission orders to prevent concealment, destruction and dissipation of sequestered and surrendered assets.

And since they were not trained and were not covered by mandatory government rules and regulations on auditing, accounting and custody of state assets, many of them became themselves the ill-getters.

To deter these wrongdoers, the PCGG came up with its own rules and regulations, but these safeguards were repeatedly violated.

For example, on April 11, 1986, the PCGG promulgated a very strict and specific rule that writs of sequestration can only be issued on the signature of at least two commissioners. The PCGG was ran by a chairman and four commissioners.

Documents gathered by this writer disclosed that between April 15, 1986, and June 20, 1986, 131 out of 148 (88 percent) writs of sequestration were issued on the signature of just one commissioner in clear violation of the PCGG's own rule.

The documents showed that of the 131 writs, 63 were issued by Commissioner Ramon Diaz, 56 by Commissioner Mary Concepcion Bautista, 10 by Commissioner Raul Daza and one by Commissioner Pedro Yap.

As a consequence, the Sandiganbayan, on many occasions, declared that where the writ of sequestration was signed by one commissioner only, the same was void and deemed automatically lifted.

In fact, this was what happened in the case of the International Copra Export Corporation, Dio Island Resort and the multibillion-peso companies sequestered by the PCGG from former Ambassador Roberto Benedicto and 17 of his close associates, to name only a few.


  • President Corazon C. Aquino's PCGG, Part II, Cecilio T. Arillo, August 2, 2017, Business Mirror

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