Pork Barrel: Mother of all PHL scams

Posted on August 3, 2013   // 0 Comments  

Pork BarrelA series of articles published by the Philippine Daily Inquirer on the pork barrel scam that has defrauded the Philippine government of an estimated P10 billion gave unassailable proof that the pork barrel program is one of the major sources of graft and corruption in government. The articles also exposed the loose implementation of funding processes in both the government and the banking system.

The revelations made by six former employees of the alleged mastermind, Janet Lim Napoles, owner of the trading company JLN, on how the company scammed billions of pesos through ghost projects and deliveries using pork barrel, Malampaya and fertilizer funds most probably sent blood pressures of readers rising. And reading what Napoles allegedly told her employers many times that “as long as there is government, there is money” makes one feel like vomiting.

In its series of explosive articles, the Inquirer said JLN Corp., using just a list of bogus recipients and foundations, and forged signatures of local officials, has allegedly converted billions of pesos in government funds into kickbacks.

The article said the JLN Group of Companies had been running the alleged racket with the complicity of officials, including legislators, and had gotten away with it because of her extensive connection in the government, according to her former employees.

The report said Napoles established foundations or NGOs to serve as recipients of the funds and named her own employees, including a nanny, as presidents of these outfits.

The funds, which were deposited in the foundations’ bank accounts, were eventually remitted to her to be split between her and the lawmaker whose PDAF allotment was used, or the official of the state agency involved.

According to the former employees, a communication from a senator indicating that his or her PDAF fund be allocated to an agency, say, the DA, would start the ball rolling.

The team would prepare the paper work, such as a memorandum of agreement, a project proposal and a letter for financial assistance from a mayor to the secretary of agriculture, all using fake documents, scanned letterheads and forged signatures. Napoles’ personal assistant would sign as the “mayor.”

“Everything is forged. The mayor was unaware of such a project and that there were funds for this,” one of the whistleblowers said. The requested “fund assistance” would range from P1.5 million to P10 million.

How can a scam involving billions of pesos in government funds be allowed to go on for years despite the presence of red flags all over the processes? How were the funds released despite the fake documents and forged signatures? Doesn’t the Department of Budget verify documents before releasing funds? Doesn’t the Commission on Audit make a pre-audit before the funds are released? Why were the alleged non-governmental organizations (NGOs) registered without verification of submitted documents?

The answers to these questions would lead to only thing: Despite proclamations by the Aquino administration to the contrary, graft and corruption remain rampant in the entire bureaucracy.

In the United States, it takes months of processing and verifications before one can register a foundation and get funds or grants from government agencies. In the Philippines, as shown by this “mother of all scams”, even a nanny and her sons can register a foundation and receive hundreds of millions of funds from the government.

The expose also showed that despite assurances from Malacanang and Congress that the pork barrel system, which allots P70 million yearly for each congressman and P200 million for each senator for public works and other projects for their constituencies, is one of the biggest sources of corruption in the government.

Five senators and 23 congressmen have been named as some of the sources of pork barrel funds channeled by Napoles’ company to fictitious NGOs and eventually to the pockets of Napoles, senators, congressmen and other government officials.

As I have repeatedly pointed out in my previous columns, pork barrel is just a euphemism for graft, or for kickback. They all mean the same.

Senators and congressmen say pork barrel is necessary for the equitable distribution of public works funds in the country. With the allocation of pork barrel funds, lawmakers claim, congressional districts are assured of a fair share of public works and other projects. Great, except that it has also resulted in the equitable distribution of kickbacks and graft money.

It is common knowledge that 15 to 25 percent of the cost of a particular public works project is earmarked for kickbacks to certain officials. In the city level, the mayor gets the biggest share of the “commission,” with the city engineer and other officials getting a chunk of the 15-25 percent kickback. In the provincial level, it is the governor who gets the biggest share, followed by the provincial engineer and other officials.

In the case of the pork barrel, the senator or the congressman is given a share of the pork barrel funds and is given the leeway to identify the project and, of course, his favored contractor. A rigged bidding is held, if deemed necessary, and the project is given to the lawmaker’s contractor, who, in turn, gives the usual 15-25 percent “commission” or “finder’s fee”, which actually is another euphemism for kickback. In the case of the JLN scam, it was alleged that the lawmaker or agency head got as much as 50 percent.

There have been many calls to abolish the pork barrel, but they have all fallen on deaf ears. The Office of the President, which has sole discretion to allocate and release the funds, wouldn’t want it to go away because the President is able to use it to sway senators and congressmen to its side on critical issues. Members of Congress, for obvious reasons, want it to stay. But is Aquino really serious about his “daang matuwid” proclamation? We will soon know. (valabelgas@aol.com)