DOJ files malversation case vs Sobrepeña group

The Department of Justice (DOJ) has filed criminal malversation raps against controversial businessman Robert John Sobrepeña and three of his top executives due to alleged misuse of public funds linked to the management of two hotels in Baguio City.

The criminal case filed before the Baguio Regional Trial Court (RTC) stems from allegations by the Bases Conversion and Development Authority of misuse of funds by Sobrepeña-led Camp John Hay Development Corp.’s (CJH DevCo) at the Manor and Forest Lodge hotels in the country’s “summer capital.”

In its resolution dated April 1, the DOJ said Ferdinand Santos, Alfredo Yniquez III and Emily Roces-Falco, top officials of CJH DevCo, were also liable together with Sobrepeña for the alleged misuse of public funds.

Probable cause was found against the four officials for two counts of malversation of funds, the first worth P1.49 million and the second worth P2.84 million.

This is the first criminal case filed by the government against CJH DevCo to have reached the courts.

“Based on their own admission, they used this money to shore up their own cash position. Under the revised penal code, that amounts to malversation,” Bases Conversion and Development Authority (BCDA) president Arnel Casanova said in a briefing Thursday.

Cases against other CJH DevCo officials, namely, Manuel Ubarra Jr., Enrique Sobrepeña Jr., Gulshan Bedi, Rafael Perez de Tagle Jr., Noel Carino, Raul Goco, William Russell Sobrepeña, Silvestre Bello III, Bobby Café, Dennis Ignacio, Ramon Cabrera and Heinrcich Maulbecker were dismissed due to lack of evidence.

Both hotels in question are owned by the government through the BCDA, but operated by CJH DevCo under 25-year contracts that started in 1998.

Casanova said in 2008, to partly pay off its mounting obligations to the BCDA, CJH DevCo decided to have its lease contract for both hotels restructured. A total of 26 hotel rooms—16 from Manor and 10 from Forest Lodge—were given to the BCDA in lieu of cash.

This means that while CJH DevCo would continue to operate the hotels, revenues from the said rooms would be given to the BCDA.

Casanova said the BCDA believes that not all the revenues from the said rooms were being properly remitted to the government-run corporation.

CJH DevCo, in its defense, said the hotels have been losing money since 2008, but the BCDA said the company had refused to open up its books to prove its claims.