US embassy cable - 05MANILA1641

C O N F I D E N T I A L SECTION 01 OF 02 MANILA 001641 
 
SIPDIS 
 
STATE FOR EAP/PMBS, EB, INR/EAP 
USAID FOR CDOWNEY 
 
E.O. 12958: DECL: 04/08/2010 
TAGS: PGOV, KCOR, PREL, MARR, ECON, RP 
SUBJECT: CORRUPTION UPDATE:  PLUNDER CHARGES (AT LAST) 
 
REF: A. MANILA 1506 
     B. MANILA 740 
     C. MANILA 464 
     D. 04 MANILA 5262 
 
Classified By: Political Officer Andrew McClearn for 
reasons 1.4 (b) and (d) 
 
1.  (C) Summary:  The Ombudsman filed plunder charges on 
April 6 against Major General Carlos Garcia and his immediate 
family members, while his court martial continues.  Neither 
case is expected to conclude soon, however.  The GRP has also 
filed new charges against 21 officials in the Department of 
Public Works and Highways.  Civil society is increasingly 
involved in anti-corruption activities, most notably with a 
planned "Philippine Integrity Fund" to assist with 
prosecutions and the Office of the Ombudsman.  End Summary. 
 
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Plunder! 
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2.  (C) Chief Special Prosecutor of the Ombudsman's Office 
Dennis Villa-Ignacio confirmed to told poloff that his office 
had filed formal charges of plunder on April 6 in the 
anti-graft court (Sandiganbayan) against Major General Carlos 
Garcia (former Comptroller of the Armed Forces of the 
Philippines), his wife Clarita, and sons Ian, Juan, and 
Timothy.  The filing of plunder charges capped a six-month 
investigation by the GRP into the Garcia case (refs b-d).  In 
a supplemental notice accompanying the charge sheet, the 
Ombudsman stated that Garcia had "accumulated, amassed, and 
acquired ill-gotten wealth by himself and in connivance with 
the members of his family."  According to Villa-Ignacio, the 
five-member Garcia clan has been accused of violating R.A. 
7080, known as "The Plunder Act," by illegally accumulating 
303 million pesos (approximately USD six million) during MG 
Garcia's years of service in the AFP.  Villa-Ignacio related 
that a panel of investigators from the Ombudsman's Office had 
discovered ample evidence of unexplained wealth in the form 
of landholdings, luxury motor vehicles, and significant 
assets in various accounts under the names of Garcia family 
members. Garcia also faces four minor charges of perjury. 
 
3.  (SBU)  According to press accounts, Clarita Garcia has 
now returned to the Philippines from the U.S., and the Bureau 
of Immigration has issued a hold-departure order to prevent 
her from leaving the country.  In the charge sheet, the GRP 
recommended that the Garcia family members be detained and 
held without bail, noting the seriousness of the charges, 
i.e. the allowable punishment under the plunder act is life 
imprisonment or even the death penalty.  As of COB April 8, 
police have apparently not yet detained Mrs. Garcia.  It is 
not clear whether the sons are in the Philippines or the U.S 
 
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Court Martial 
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4.  (SBU) Military court proceedings continue against Garcia 
in parallel with the criminal trial.  On April 4, DHS Attache 
testified to the court martial panel that Garcia is currently 
a legal holder of a U.S. Alien Registration card.  (Note: 
Under the Philippine Constitution's Article XI Section 18, 
public officials who seek to change citizenship or to acquire 
immigrant status in a foreign country shall be "dealt with by 
law." end note)  The prosecution has vowed to wrap up its 
case by April 22, after which Garcia's defense will begin. 
The maximum penalty is dishonorable discharge from the AFP 
and a forfeiture of AFP retirement benefits. 
 
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Other Developments 
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5.  (C) Other significant public and private sector 
developments in the ongoing effort to reduce corruption since 
Mission's last summary in Ref B are: 
 
-- The House Committee on Natural Resources on March 16 
created an oversight group to probe questionable local 
government management of the lucrative quarry operations in 
Pampanga Province, located northwest of Manila.  Vice 
Governor Joseller Guiao earlier had accused current governor 
Mark Lapid and his predecessor (and father) -- now Senator 
Manuel Lapid -- of skimming close to USD seven million from 
the quarry operations from 1999 to 2004; 
 
-- Secretary Angelo Reyes of the Department of the Interior 
and Local Government (DILG) asked the Ombudsman to file 
criminal charges against two Bureau of Customs officials 
allegedly involved in smuggling at the Batangas International 
Container Port.  Reyes, who also heads the National 
Anti-Smuggling Task Force (NASTAF), accused Customs 
collectors Napoleon Morales and Marius Anderson of violating 
the Anti-Graft and Corrupt Practices Act; 
 
-- The Ombudsman's Office on March 8 filed graft charges 
against 21 officials of the Department of Public Works and 
Highways, accusing the group of participation in a USD 
750,000 vehicle repair scam in 2001.  This new set of charges 
came shortly after the Sandiganbayan dismissed earlier, more 
serious, charges of "plunder" against the same 21 officials; 
 
-- The Makati Business Club and the Philippine Bar 
Association announced on April 6 that they would launch the 
"Philippine Integrity Fund" on May 5.  This fund's aim is to 
provide a "donation mechanism" for private law firms and 
businesses to channel monetary contributions and volunteers 
into the public sector, especially to the Ombudsman's Office. 
 Several private lawyers are already providing pro bono work 
to support prosecutors in this office on high-profile cases. 
 
 
 
Visit Embassy Manila's Classified SIPRNET website: 
http://www.state.sgov.gov/p/eap/manila/index. cfm 
 
You can also access this site through the State Department's 
Classified SIPRNET website: 
http://www.state.sgov.gov/ 
Mussomeli