Tuesday, October 14, 2008 De Venecia, son to face graft raps over NBN deal
THE Department of Justice (DOJ) on Monday recommended the filing of graft charges against former House Speaker Jose de Venecia Jr. and his son Joey for allegedly using their influence to lobby for one of the firms that vied for the government's award of the multimillion-dollar broadband deal.
Joey earlier admitted that he used to own a substantial share in the American trading firm Amsterdam Holdings Inc. (AHI) that made an unsolicited proposal for the National Broadband Network (NBN) project, which was eventually awarded to the Chinese firm ZTE Corp. for US$329-million.
In its report, the panel of prosecutors led by Undersecretary Ernesto Pineda recommended to the Office of the Ombudsman the actions of the father and son duo for the possible filing of charges against them, as well as the transmittal of stenographic notes of the testimonies of resource persons who appeared before the panel.
"Accordingly, it is the recommendation of the panel of investigators that a copy of this report... be furnished the Office of the Ombudsman for the commencement of any proceeding against Mr. Joey de Venecia and/or then Speaker Jose de Venecia, as it may deem appropriate under the circumstances," the panel report stated.
The DOJ panel said the younger de Venecia actively pursued the interests of AHI to be awarded the government contract despite his relations with his father who is a public official, in violation of the law.
"His possible use of the influence and clout of his father on government functionaries cannot be discounted. A conflict of interest is apparent herein," the panel stated.
But other than the fact that he is the father of Joey, the panel did not state any other reason pointing to the former Speaker's culpability in supposedly lobbying for AHI.
The panel was initially tasked to investigate who were the personalities may be liable for violations of Republic Act (RA) 9184 or the Government Procurement Reform Act, RA 3019 or the anti-graft law, and other related laws in connection with the NBN-ZTE deal.
During the panel hearings that took place from February 19 to April 8, Joey, along with NBN-ZTE witness Rodolfo "Jun" Lozada Jr. and former National Economic and Development Authority (Neda) director Romulo Neri, did not attend the proceedings as resource persons.
Transportation Assistant Secretary Lorenzo Formoso III, who was one of the witnesses who attended the hearings, told the panel that he had raised ethical issues in the negotiation and conclusion of the contract with AHI because of Joey's blood relations with the former Speaker.
The panel noted that Joey even personally met with officials of the Department of Transportation and Communications (DOTC) and even formally conveyed to Neda the proposal of AHI in hopes that Neda will endorse the unsolicited proposal to the DOTC for favorable action.
"Needless to state, Neda takes cognizance only of the project proposals submitted to it by government agencies such as the DOTC. Apparently, the action of Mr. Joey de Venecia of directly bringing the proposal of AHI to Neda was meant to rein in the DOTC to seriously consider the same over and above the proposal of ZTE Corp.," the panel reported.
On the matter of the alleged overprice of the NBN project, the panel said it found no evidence of overpricing in the cost of the project because of the failure of witnesses, particularly Joey, Lozada and Neri, to testify before the panel.
It pointed out that Joey was subpoenaed twice to be able to exact from him some evidence of overpricing as he alleged during Senate hearings late last year until early 2008.
Joey's claims were corroborated by Lozada who allegedly was tapped by Neri to work on the project.
"The said two supposed resource persons were very vocal on the charge of overpricing, but they refused/failed to appear before the panel. The refusal/failure to appear is considered by the panel as an indication that they are not in a position to present any solid proof of overpricing in the cost of the ZTE project," the DOJ said.
The panel however gave the DOTC a mere slap in the wrist for not asking for a much-reduced price than what was offered by ZTE in its proposal.
"Foremost among these matters is the seeming laxity of the DOTC and Neda officials to seize the initiative, to secure a reduction in the price of the proposal of the ZTE," said the panel.
The DOJ recommended that procedures for direct contracting of projects or government-to-government transactions of projects be reviewed so that appropriate measures will be taken to enjoin government officials to seek and negotiate with project proponents lower prices than that presented by the latter.
It also recommended the promulgation of appropriate administrative guidelines by the Office of the President to curb the presence of persons in the negotiation of government contracts, who are not officially connected with the government agency proposing the project, or agencies involved in the project and impose sanctions on government officials who allow such presence.
The original NB-ZTE contract was signed by President Gloria Macapagal-Arroyo on April 20, 2007 in Hainan, China. However, the government aborted the contract due to massive criticisms of this anomalous deal.
The NBN project was meant to inter-connect government agencies to the barangay level and was touted to bring savings to government of about P3.4 billion yearly in telephone bills. Funding under the contact with ZTE would come from a 15-year loan from the Chinese state-owned bank with a five-year grace period. (ECV/Sunnex)
