Ex-DBP chief Sison acquitted in loan guarantee case
Philippine Daily Inquirer
A former chairman of the Development Bank of the Philippines was acquitted of graft for giving a P188 million loan guarantee to the Sta. Ines Mining and Steel Corp., which was allegedly not backed by sufficient collateral.
The Sandiganbayan First Division ruled on Thursday that former DBP Chair Rafael Sison did not give undue favors to the mining firm when he guaranteed its loan with Germany-based Dresdner Bank in 1980.
Sison was accused of giving undue favors to Sta. Ines Mining and Steel Corp. (SIMSC) by guaranteeing its loan with the German bank that had insufficient collateral. Because SIMSC’s proposed project was not completed, it was unable to pay its loan to Dresdner and the government had to shell out the P188.577 million payment.
“There is a dearth of evidence to show that in approving and signing the Guaranty and the Amended Guaranty in favor of Dresdner, the accused with manifest partiality, evident bad faith or gross inexcusable negligence, gave unwarranted benefits to SIMSC, thereby causing the government undue injury in the amount of P188,577,000,” the antigraft court ruled.
The Sandiganbayan said that even if the government had suffered an injury by having to pay for the loan, Sison could not be held liable based on the circumstances in this case.
“The decision of the accused as a member of the Board of Governors of DBP to approve the loan was based on his considered judgment, taking into consideration the Evaluation Report presented to the Board, and not for some malicious and personal interest,” it said.
It noted that the noncompletion of the SIMSC’s project was not the fault of the DBP or the mining firm, but was due to circumstances beyond their control.
It also said the prosecution’s evidence consisted only of Sison’s signatures on the guaranty and amended guaranty, which he signed because of a DBP board resolution allowing him to do so. It was also safe to assume that Sison was among those who had approved the loan accommodation to the mining firm, it added.
But these were not enough to show that Sison had violated the law. The prosecution also failed to prove any other act that would show he unjustifiably favored SIMSC.
It did not agree that Sison’s “malevolent purpose” in guaranteeing the loan could be seen from the fact that the mining firm was undercapitalized, its loan undercollateralized and its proposed project nonfeasible. The DBP Management had studied and evaluated the proposed financial accommodations to SIMSC before recommending its approval, it noted.
The court also said it was not convinced that the loan guarantee that the DBP extended to SIMSC did not have sufficient collateral. The mining firm was also not undercapitalized, it said.
The prosecution had argued that the mining firm only put up P169.95 million in future assets as collateral for the P188 million loan guarantee.
According to the court, there were other conditions set by the DBP, such as requiring SIMSC’s president to sign the accommodations in his personal capacity, thus making him liable along with the firm. Leila B. Salaverria
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