Ombudsman: Four Cebu City officials are convicted for unliquidated cash advances, former State U President is convicted of Graft, former CHK Dean is Suspended

The Sandiganbayan convicted four ranking officials of Cebu City of graft charges for allowing a paymaster to accumulate unliquidated cash advances amounting to more than P11M in 1998, according to the Office of the Ombudsman in a press statement released last December 11, 2010.

In a 43-page Decision, the First Division of the Sandiganbayan found Alan Gaviola, then City Administrator; Eustaquio Cesa, then City Treasurer; Benilda Bacasmas, then Cash Division Chief; and Edna Jaca, then City Accountant, all of the Cebu City government, guilty beyond reasonable doubt of violation of Section 3(e) of RA 3019 (Anti-graft and Corrupt Practices Act).

Records showed that an audit team conducted a cash examination on the cash and account of various accountable officers, including Paymaster Cleofe Delute, of the Cash Division of the City Treasurer’s Office of Cebu City, covering the period Sept. 20 1995 to March 5, 1998.

This resulted in the discovery that Delute had accumulated an unliquidated cash advances of P11,180,033.92. Delute had already been charged for and convicted of Malversation of Public Funds before the Regional Trial Court of Cebu City. She is now serving sentence before the Bureau of Corrections.

The prosecution, led by Assistant Special Prosecutor II Sheri P. Zales of the Office of the Special Prosecutor of the Office of the Ombudsman (OMB-OSP) believed that Delute could not have possibly committed such act without the participation of accused Gaviola, Cesa, Bacasmas and Jaca.

In its Decision, the Anti-graft court said that “It is well to note that their signature followed a sequence. The voucher could only be forwarded to the next office if already signed by the prior office. Xxx The accused were expected to have done what was required of them to be able to truthfully affirm the pre-typed certification in the voucher. This includes the first step in the process and the very basic act of examining the voucher and its attachments, but which the accused had failed to do.”

It said one could readily notice the incompleteness of the documents submitted by Delute for signature:

“sheets of bond paper” served as Delute’s requests for cash advances;

The requests did not indicate that they were for payment of salaries because each request merely showed a handwritten note reading: “Cash Advance – 1,000,000.00”;

The net amount of the payrolls as reflected in the adding tape attached to the written requests was rounded-off and the rounded-off amount was entered in the disbursement voucher in violation of paragraph 4.2.1 of COA Circular No. 97-002 which states the cash advance shall be equal to the net amount of the payroll for a pay period;

The subject vouchers only state uniformly, “ TO CASH ADVANCE IN THE AMOUNT OF (various amounts) IN PAYMENT FOR SALARIES”, without specifiying the pay period and to which department the salaries would be paid, in violation of paragraph 4.1.1 of COA Circular No. 97-002 that “ no cash advance shall be granted unless for a legally specific purpose”;

Despite said defects in the documentation, the four officials Gaviola affixed their signatures on the cash advance vouchers. Hence, the Sandiganbayan said “ The prosecution sufficiently established that the patent negligence of accused Gaviola, Cesa, Bacasmas and Jaca facilitated the accumulation of Delute’s unliquidated cash advances of P11,180,033.92”.

The Anti-Graft Court sentenced each of them to suffer the indeterminate penalty of imprisonment of six years and one day to eight years and were perpetually disqualified from holding any public office.

They were additionally directed to jointly and severally pay the City Government of Cebu the amount of P11,180.033.92.

Former state U president convicted of graft

Last August 19, 2010 the Office of the Ombudsman announced that the Sandiganbayan has convicted a former President of a State University of four counts of graft for appointing his sons as student laborers and approving the payment of their salaries even without actual performance of labor services.

In a 37-page Decision, the 5th Division of the Sandiganbayan found Dr. Elpidio Locsin, Jr, President of the Iloilo State College of Fisheries (ISCOF) in Barotac Nuevo, Iloilo guilty beyond reasonable doubt of four counts of Violation of Sec3(e) of RA 3019 (Anti-Graft and Corrupt Practices Act).

He was sentenced to suffer the penalty of imprisonment ranging from six years and one month to ten years, to suffer perpetual disqualification from public office for each count and to return the salaries paid to his children.

Records of the case showed that Locsin is President of ISCOF from 1993-2005. The school offers a Student Labor Program to help students and reduce the expenses of the school. Three of Locsin’s children applied for the said program: Neil Arvin, Gelner Keats and Elpidio III. They were assigned in the Office of the College President, and the Integrated Fish Farm on various dates.

The prosecution team led by Deputy Special Prosecutor John Turalba accused Locsin of accommodating his children to program, even though they did not meet the qualifications.

Under RA 7323 (The Special Program for Employment of Students) being implemented by the Dept. of Labor and Employment, only students with parents earning below P36,000 per annum can avail of the program. The program aims to assist students who are deserving, poor and not capable in going to school to have added income, appreciate labor, and as training to them.

The prosecution also charged Locsin of having caused the payment of his children’s salaries without actually rendering labor service. They presented witnesses which claim that Gelner Keats was enrolled at the Western Visayas College of Science and Technology (WVCST) which is an hour and thirty minutes ride back and forth from the school.

They said the other children were seen playing basketball and riding bicycle around the campus at the time that they were supposed to be working. Locsin in his defense claimed that his children availed of the school’s Regular Student Labor Services in the College and not the SPES under RA 7323. He said the regular program has no joint salary requirement.

Moreover, he maintained that his children worked contrary to the claim of the prosecution. However, Prosecutors Louela Pesquera and Rohermina Rodriguez presented evidence that the College Order availed of by his children was approved by the school board only on November 23, 2000, and so it is not applicable to the children of the accused who worked as student laborers in 1997 and 1998.

In its Decision, the Anti-graft court gave weight to the evidence presented by the prosecution. It said, “Being the president, to include one’s children in a program offered by the school itself supposedly for the poor is just plain unacceptable. In these cases, the accused included not just one, but three of his children in the Student Labor Program of ISCOF. Xxx The three slots could and should have been availed of by students more in need of the salaries to be derived therefrom.”

The Court said by approving the appointment of his children and approving their salaries as student laborers, Locsin gave them unwarranted benefit and preference over other deserving students. Further, it said the salaries granted to his children caused undue injury to the government.

Ombusman suspends former U.P. Diliman CHK Dean for 6 months, 1 day without pay


In yet another recent case, the Office of the Ombudsman announced last August 19, 2010 suspended for six months and one day without pay Hercules Paulmino Callanta, former Dean of the University of the Philippines - College of Human Kinetics (CHK).

The case arose when Callanta engaged the services of “The Lord’s Inheritance Catering” in two occasions sponsored by their college: the Recognition Day Program held on April 22, 2007 and the Summer Recreation Program held on May 26, 2007.

Based on the records of the Dept. of Trade and Industry (DTI), the business name “The Lord’s Inheritance Catering Services” was registered from 2001 to 2006 under the name of Hercules P. Callanta; and from 2003 to 2008 under the name of Luz S. Callanta.

In his Counter-Affidavit, Callanta denies the allegations. He argued that awarding contracts for the CHK activities is not a part of his functions as Dean. He said for the Recognition Day, a Refreshment Committee was charged with the canvassing of catering firms which submitted recommendations to the College Executive Board. The Board awarded the catering contract to “The Lord’s Inheritance Catering Services”.

On the other hand, for the Summer Recreation Program, the decision to engage the services of the said caterer was delegated to Assistant Professor Angelita Cruz, Dir. for Community Recreation.

However, investigation conducted by the Office of the Ombudsman showed that Callanta himself is a member of the Board so he is involved in the awarding of the catering contract to the said caterer. For the Summer Recreation Program, it was found out that the Disbursement Voucher was approved and signed for payment by Callanta which implies that Callanta likewise knows and approves of the CHK’s venture with his own catering firm.

The OMB investigators said “therefore, Callanta cannot rightfully claim that the two catering contracts of the CHK with ‘The Lord’s Inheritance Catering’ did not require the approval of the Office of the Dean, because in the two instances, his involvement is plainly evident.”

Aside from the penalty of suspension, the Ombudsman ordered the filing of Information for two counts of Violation of Sec 7(a) of RA 6713 (Code of Conduct and Ethical Standards for Public Officials and Employees) before the proper court.

(Source: December 11, 2010 Press Release from the Office of the Ombudsman: http://www.ombudsman.gov.ph/index.php?navId=MTQ=&pressId=MTM4 and August 19, 2010: http://www.ombudsman.gov.ph/index.php?navId=MTQ=&pressId=MTEx)