09/13/2010 [ tribune.net.ph ]
Both chambers of Congress indicated yesterday interest in conducting an investigation into the alleged anomalous financial arrangement between the state agency Home Development Mutual Fund (Pag-Ibig Fund) and private developer Globe Asiatique that received about P7.1 billion in Pag-Ibig loans for two of its housing projects.
Sen. Sergio Osmeña III said the Senate will dig deeper into the questionable deal while Cavite Rep. Elpidio Barzaga Jr. said he is pushing a full-dress House inquiry into the issue.
The Pag-Ibig loans were supposedly obtained by non-existent borrowers to acquire property at Globe Asiatique’s Xevera projects in Mabalacat and Bacolor, both in Pampanga.
Osmeña, chairman of the Senate committee on banks, financial institutions and currencies, took to task the Pag-Ibig for the loan deals with Globe Asiatique.
“Yes, we will investigate this. This falls under the jurisdiction of the committee on banks,” he said, noting that the arrangement was a case of conflict of interest.
He expressed concern over how and why the developer was allowed to qualify the borrowers on behalf of Pag-Ibig. “Of course, Globe Asiatique was only interested in making sure that it gets paid by Pag-Ibig. It did not care if the Pag-Ibig mortgages get repaid,” he added.
The senator noted the testimony of Emma Linda Faria, officer in-charge of the Pag-Ibig fund, that P7.1 billion in mortgages had been given to 9,951 buyers whose qualifications were approved by Globe Asiatique by the virtue of an agreement between the developer and the government agency. The loans were made between July 2008 and June 2010.
“This is anomalous. Pag-Ibig or any lender should never allow this. It is a conflict of interest,” he stressed.
Faria also admitted that after a post-validation process, or inspection after the monies had been released, 400 of the borrowers denied applying for a housing loan; 1,000 could not be located and 200 had incomplete documentary requirements. Because of these findings, she said Pag-Ibig had asked Globe Asiatique to refund the loans, amounting to about P1.1 billion.
“But how can he (Globe Asiatique president Delfin Lee) buy back those loans? I heard him in a recent media interview say that he has no money to pay that P1.1 billion,” Osmeña said, raising concerns that Pag-Ibig Fund members and the public would have to swallow the huge loss and/or foreclose on the empty units, which would deteriorate over time.
Barzaga said the House wanted to validate reports that former housing officials, including then members of the board of trustees of the Pag-Ibig Fund, received condominium units from Globe Asiatique Realty Holdings Corp.
Barzaga said his office had received information that a number of former housing executives allegedly got residential units from Globe Asiatique, particularly at the firm’s 30-level GA Twin Towers along EDSA in Mandaluyong City.
“This has to be verified right away by congressional investigators and the new Pag-Ibig management,” Barzaga said.
“If the allegation is true, then we have to find out how they (former housing officials) acquired the properties. Whether they got the assets for free, or at a discount. Or if they bought the units using their own money,” he said.
“If they purchased the units, then they should have the documents to prove not only that they actually paid for the properties, but also that they had the lawful income to support the payments. Of course they should have also declared these assets in their annual filings,” he added.
The GA Twin Towers was one of Globe Asiatique’s early joint housing development projects with Pag-Ibig.
Barzaga said he had nothing personal against the owner of Globe Asiatique or the former housing officials. He stressed the need for Congress to protect Pag-Ibig funds, which he said represent the hard-earned contributions of public and private sector workers.
“This is all part of our mandate. We just want to get to the bottom of the syndicated fraudulent housing loans, plus Globe Asiatique’s P1-billion worth of unpaid obligations to Pag-Ibig,” he said.
According to Barzaga, the unchecked grant of fraudulent loans was a key factor that caused the recent home mortgage debt crisis and the eventual collapse of America’s housing market, that in turn set off a global financial meltdown.
“But in America, they at least actually had real persons who borrowed the money to buy the homes, either to occupy or for investment purposes. There was fraud only in paperwork compliance, since it turned out that many loans were granted even to persons who did not have enough income,” he pointed out.
He added: “With respect to the Pag-Ibig loans in question, they had borrowers that did not exist at all. So where did the all loan disbursements go?”
Barzaga expressed alarm over the breakdown of internal controls at Pag-Ibig. “Either the checks (against potential fraud) failed, or there was connivance by Pag-Ibig insiders,” he said.
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