Category: The Judiciary

Sereno y Carpio: UP clams up for the chief, tales of Megatron

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IN PCIJ’s analysis, the biggest obstacles to achieving full transparency in the high court seem to be its top two officials: Chief Justice Ma. Lourdes P. A. Sereno and Associate Justice Antonio T. Carpio.

The two were among the seven who did not respond to PCIJ’s clarificatory letters but whose SALNs invite the biggest questions of all.

In Sereno’s case, what happened seems to be either indifference or diffidence to PCIJ’s request for asset records she had filed in previous years that only she can actually decide on now. The matter has been awaiting Sereno’s action since last month.

It all started with PCIJ submitting a request last September with the University of the Philippines for copies of SALNs that Sereno had filed as a professor with the UP College of Law form 1996 to 2002. The documents are on file with the UP Human Resources Development Office.

But instead of releasing Sereno’s SALNs, the premiere state university, which is usually jealous of its academic freedom and avowedly as zealous about good governance, rushed to the Court en banc for an opinion.

According to UP President Alfredo Pascual, it was the advice of UP’s lawyers to get clearance from the high court before releasing Sereno’s SALNs in light of the high court’s Guidelines on the release of the justices’ SALNs.

Here’s the thing: the Guidelines, which clearly refer to SALNs of justices and judges, were issued in 2012, or 10 years after Sereno had filed her last SALN with UP as a law professor.

Last month, the en banc tossed the issue to the Office of the Chief Justice so Sereno herself could decide on it. So far, she has yet to take action in favor of transparency.

Carpio’s refusal to deal with what PCIJ found were apparent disparities in his SALNs, meanwhile, is totally inconsistent with his declaration that a new era of transparency had come upon the high court, when he became acting chief justice.

PCIJ’s clarificatory letter to Carpio raised the following concerns:

* His 2011 SALN lists the total amount of personal properties at P54,241,220.00, but PCIJ’s computation of the 23 properties that he declared he owns amounted to P58,425,914.00. There seems to be a difference of P4,184,694.00, which should make his total net worth P84,079,719.57 and not P79,895,025.57 as he said in his 2011 SALN.

* Carpio’s latest SALN enrolled assets worth P4,184,694.00, P552,500.00, and P10,000,000.00 representing “insurance” policies. He did not say whether or not these are the face value of his policies or just the premiums he had paid.

According to a tax lawyer, however, it is not exactly correct to say that the face value of one’s insurance policies are one’s assets. These do become assets of the filer’s beneficiaries after the filer would have passed on, says the expert. Interestingly, the amount of one of the policies – P4,184,694.00 – matches the discrepancy between his stated total net worth and PCIJ’s computation.

* The real nature and extent of operations of what Carpio disclosed was his family’s holding firm, Megatron Holdings, Inc. beg more explanation. This became apparent after PCIJ reviewed the corporate records of Megatron at the Securities and Exchange Commission.

Megatron had filed certificates of non-operation for several years, yet still it continues to hold office at the offices, before and today, of Carpio’s former law firm, CVC Law, which is also known as “The Firm”. Carpio had reported in his 1992, 1993, 1994 and 2011 SALNs that Megatron’s address was 138 Bunga Extension, Ayala Alabang Village, Muntinlupa, Metro Manila. This is what Carpio has listed to be his residential address as well.

* Megatron’s corporate records, and the CVCLaw’s official website, enroll a different address for the Carpio family’s holding company.?In its 2006 General Information Sheet (GIS), Megatron said it holds office at the “5th Floor, LTA Building, 118 Perea St. Legaspi Village, Makati City, Metro Manila.” This building is owned by the family of former First Gentleman Jose Miguel Arroyo.

CVC Law had held office there for a long period of time, or until they moved to the CVC Law Center at the swanky Global City in 2009.

* In its 2010, 2011, and 2012 GIS, Megatron, listed its business address at: “11th Avenue corner 39th Street, Bonifacio Triangle, Global City 1634, Metro Manila.” This is exactly where the five-story CVC Law Center now stands.

To be sure, the amended articles of incorporation in 2001 and other records at the SEC of CVC Law reflected a divestment by Carpio from the law firm that he co-founded, within days after he was appointed associate justice by then President Gloria Macapagal Arroyo. – PCIJ, December 2012

NOTE: This story was the sidebar to the last part of PCIJ’s special report on “The Wealth of the ‘Gods of Faura.’”

The rapidly rising net worth of the Supreme Court justices

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EXACTLY A year ago tomorrow, on Dec. 12, 2011, President Benigno Simeon C. Aquino III marshaled votes from his Liberal Party and coalition allies in the House of Representatives to impeach then Chief Justice Renato C. Corona.

The chief magistrate, it was alleged, had failed to declare the true and full details of his wealth in his Statement of Assets, Liabilities, and Net Worth (SALN).

But by most indications, many strands of Corona’s story find parallels in the state of wealth of most of his former colleagues at the Supreme Court, as of 2011.

For instance, like Corona, nearly all the justices retain sizeable caches of cash on hand and in bank. In fact, four justices have zero liabilities, as of their 2011 SALNs.

Only two justices have loans or liabilities of around P5 million, and only one with P16-million liabilities on account of his wife’s business ventures. The rest of the justices have a little less or more than P1 million in loans.

Like Corona as well, land or real assets remain the pivot or bulk of the assets of at least four justices. All the rest, except for one, have land estates accounting for 30 to 50 percent of their assets. The seemingly basement prices at which some justices acquired their houses and lots and agricultural land are incredible to say the least.

Unlike Corona though, several of the justices have fairly robust portfolios of equity interest in family corporations and holding companies, and in sundry stocks in corporate entities they did not identify in 2011 but had revealed in their previous SALNs.

PCIJ’s review of the data enrolled in their SALNs through the years, however, yields a number of disparities that beg further explanation from the justices. Our findings include:

  • A largely sharp uptick in the net worth of invariably all the justices across a decade. For eight justices whose 2000, 2002, 2003, and 2011 SALNs are available, PCIJ found that the rise in their net worth ranged from P6.75 million to P81.65 million, or from 58 percent to 558 percent more, across a decade.
  • Some justices have reported changing or rising acquisition costs, as well as static fair market values, for their properties; the others did not even disclose the acquisition costs of their real assets.
  • A number of corporate interests are not disclosed in the SALNs of some justices but in which, SEC records show, they still retain equity interest as incorporators, shareholders, or officers.
  • Conflict of interest situations – in law, could either be real, potential, or apparent – confront three justices because of loans that they had acquired for companies in which their spouses have interests, or for a family holding firm with office addresses at the old and new offices of one justice’s former law firm.
  • Twelve justices have brought in two to six relatives as executive assistant, judicial staff, legislative staff or consultant in the Supreme Court and the electoral tribunals. They include the spouse, children, siblings, nephews, nieces, and in-laws of the justices. At least four have at least six relatives each in government, majority employed by the high court and the electoral tribunals.
  • Bad math marks the SALN of two justices who apparently failed to derive the correct sums of their assets, thus pruning the value of their true net worth.

Read Part 3 of our report on The Wealth of the ‘Gods of Faura’ here.

Fat allowances of Corona not taxed: Happy days linger at SC?

Ed Lingao Leave a comment

IN THE SECOND installment of the PCIJ’s four-part report on the self-appointed perks and privileges of the “Gods of Padre Faura,” the Philippine Center for Investigative Journalism looks at how special and redundant allowances and honoraria bloat the take-home pay of the justices of the Supreme Court.

More tellingly, this story by PCIJ Executive Director Malou Mangahas shows how sundry allowances, bonuses, and fringe benefits of the Supreme Court justices had not been not taxed — a matter that had been verified in the case of impeached chief justice Renato C. Corona.

This is according to the reports submitted to the Bureau of Internal Revenue by the high court’s finance and accounting office. But the situation seems to linger still for the most senior justices of the land who continue to receive an excess of extra pay, while other public officials and employee who don’t get as much, fork out more of their hard-earned money to the taxman.

Read Part 2 of the PCIJ special report here.

The wealth of the ‘Gods of Faura’

Ed Lingao Leave a comment

WHEN CONGRESS IMPEACHED then Chief Justice Renato C. Corona on December 12, 2011 because he had allegedly filed an intentionally flawed Statement of Assets, Liabilities, and Net Worth (SALN), it was a signal for public servants that the document they submitted each year was not to be trifled with.

And when Corona was found guilty by the Senate impeachment court of excluding a substantial portion of his assets in his sworn SALN, transparency in the details of their income and wealth became a clear obligation – and strong public expectation – of all public officials, but especially of the justices of the Supreme Court.

Based on the contents of their 2011 SALNs, however, this lesson seemed to have been lost on the justices of the high court. Not only have most of them apparently underdeclared the true amount of their income – in law, salaries plus allowances – in their SALNs, half of them declined to answer questions about these.

For this joint story project with Solar Network News, the PCIJ validated the data enrolled in the justices’ 2011 SALNs with corporate records and the SALNs that they had filed in prior years.

PCIJ then wrote 14 of the justices separate letters to clarify the apparent disparities in the data enrolled in the various documents. Half or seven of them replied to the PCIJ’s queries.

The other seven, including Chief Justice Ma. Lourdes P.A. Sereno, and Associate Justices Bienvenido L. Reyes and Estela M. Perlas-Bernabe – all appointees of Preisdent Benigno Simeon C. Aquino III – refused to be quizzed about the details of their wealth. Senior Associate Justice Antonio T. Carpio did not respond, too.

But in its recently released Report on Salaries and Allowances for 2011 (ROSA), the Commission on Audit ranked the high court justices among the top 200 best paid, out of 6,489 senior public officials in 864 government agencies in the country.

The 2011 ROSA reveals that seven of the 14 justices are receiving allowances of more than half a million pesos each, and the others, at least P312,000 each. In addition, four justices are being paid more than P2 million in other benefits, incentives, and bonuses.

Of the 10 justices who put a figure in the annual income column of their 2011 SALN form, six declared that they received only P1.08 million to P2.9 million.

Left out was a slew of allowances, bonuses, and benefits that apparently fattened the justices’ take-home pay by two to three times more, or from P2.22 million to as much as P4.63 million.

Part 1 of our report looks at the disparities between the income that 10 justices declared in their SALNs (four others did not disclose at all) and the data enrolled in COA’s 2011 ROSA. It comes with two sidebars: The COA’s ROSA story, and a ‘Money Talk’ guide.

Part 2 looks at the tax implications of this windfall of extra pay that the justices received in 2011.

Part 3 reviews the details of the assets and liabilities of the justices, as they had declared in the 2011 and prior years’ SALNs.

Part 4 focuses on the implications of the unyielding resort to secrecy by the court on transparency, accountability, and integrity of the judiciary – supposedly the main reasons why Congress voted a year ago to impeach a chief justice.