MANILA, Philippines – The Presidential Commission on Good Government (PCGG) is seeking to reverse the sale of a P4.3-billion state-owned lot in Pasig City to an affiliate of property giant SM Development Corp. — a transaction which it has called a “midnight deal” of the Arroyo administration, and a “grossly disadvantageous sale.”
The PCGG on Tuesday filed an affidavit of adverse claim before the Pasig City Register of Deeds “to prevent the transfer” of a property of state-owned Philippine Integrated Meat Corporation (PIMECO).
Officials said their predecessors at the PCGG and the Office of the Solicitor General waived the state’s rights to the lot to facilitate its 2009 sale to the SM Group’s Consolidated Property Development Corporation for roughly P1 billion, incurring government at least P3.3 billion in losses.
On the grounds of fraud, the commission is also set to file a plea before the Sandiganbayan to nullify a compromise agreement between former PCGG officials and the SM group that paved the way for the sale.
“The transaction is evidently fraudulent and the implementing contracts grossly disadvantageous to the government,” said PCGG Legal Department Commissioner Gerard Mosquera in the claim affidavit.
PCGG Chair Andres Bautista said the C-5 lot’s sale was “another midnight transaction initiated, negotiated, and executed during the final eight months of the previous administration.”
“The new PCGG and GSIS management [are] seeking to recover the multi-billion peso property on the contention that the transfer from GSIS to the SM Group (through PIMECO) and the waiver by the PCGG of the Republic’s rights and interests over the property was fraudulently effected and obtained, with the connivance of previous officials of the PCGG and GSIS,” said the commission.
The lot was originally under a lease-purchase agreement between PIMECO and the Government Service Insurance System’s (GSIS) Meat Packing Corporation of the Philippines. The lease matured in 2009, giving PIMECO purchase rights.
PCGG contends 100 percent ownership of PIMECO as the state owns 30 percent of the firm and has sequestered its remaining capital stock pending recovery litigation at the Sandiganbayan.
Officials alleged that former PCGG officials “waived all of its (commission’s) rights and interests to the property for approximately PhP100 million (in favor of the SM Group).” Former GSIS Winston Garcia then allegedly facilitated the sale for P1.1 billion.