Almost half of PDAF goes to favored NGOs

In Nabcor alone, 7 NGOs with interlocking interests – including Napoles' groups – repeatedly got solons’ funds over 5 years despite unfavorable findings by state auditors

Aries Rufo

5:27:56am July 26, 2013

8:35:24am August 11, 2014

MANILA, Philippines – It isn’t just alleged public fund syndicate head Janet Lim-Napoles and her dubious non-governmental organizations (NGOs).

There’s a bigger but seemingly exclusive network of groups outside government that have been cornering lawmakers' pork barrel in recent years.

In a continuing study of audit reports on the National Agri-Business Corporation (Nabcor) from 2007 to 2011, Rappler uncovered NGOs with interlocking interests repeatedly getting solons’ funds despite unfavorable findings by state auditors.

Of the 26 NGOs that availed themselves of the Priority Development Assistance Fund (PDAF) through Nabcor, there were 7 that shared incorporators and officers with 2 to 4 others in the list. These 7 favored groups included 2 that have been identified with Napoles.

These 7 “sister” NGOs cornered P611.03 million – almost half (45%) – of the P1.35 billion that the Commission on Audit (COA) found to have been misappropriated or misused by 26 NGOs.

Nabcor is under the Department of Agriculture, tasked to ensure that the DA’s investments in livestock and agriculture enterprises are made sustainable rather than as outright expense. It acts as a markethehing arm of the DA in the acquisition and distribution of farm outputs.

We have focused our research on this government-owned and -controlled corporation after whistleblower Benhur Luy identified it as one of at least 3 government entities through which alleged scam brains Napoles usually accessed the PDAF of senators and congressmen.

READ: Pork barrel 'queen' parties with solons

From 2007 to 2011, COA noted that a combined P1.35 billion of PDAF from at least 49 senators and congressmen went to NGOs that:

had no track record;

had no capability to put up counterpart funds;

had interlocking interests with other beneficiary NGOs;

did not comply with COA regulations;

failed to provide a list of beneficiaries for the PDAF-funded projects.

In a number of cases, NGOs got several PDAF releases – with one getting as many as 10 in an election season.

The NGOs got these from congressmen from districts that were not in the same regions, suggesting that their pork barrel might not have been used for their constituents.

Of the 26 NGOs that state auditors questioned, only 11 were in existence – at least, on paper, according to their incorporation records at the Securities and Exchange Commission – years before the 5-year period audited by COA.

Four do not have incorporation records at all, although 2 of them have names bearing big similarities with NGOs registered with the SEC.

The rest of the NGOs were incorporated only shortly before they availed themselves of the lawmakers’ pork barrel.

The 7 NGOs with interlocking interests and the amount of PDAFs they received over 5 years were the:

Social Development Program for Farmers Foundation Inc – received 7 releases amounting to P225.28 million.

Kabuhayan at Kalusugan Alay sa Masa Foundation – 16 releases, totalling P179.74 million.

Kaagapay Magpakailanman Foundation Inc – 3 releases, totalling P63.12 million.

Kasangga sa Magandang Bukas Foundation Inc – 1 release, P56.55 million.

Gabay at Pag-asa ng Masa Foundation – 1 release, P52.87 million.

People’s Organization for Progress and Development Foundation – 1 release P24.25 million.

The Likhaan Group Inc – 2 releases, totalling P9.22 million.

Of these 7, Social Development Program for Farmers Foundation Inc and People’s Organization for Progress and Development Foundation have whistleblower Benhur Luy as an incorporator and officer, indicating its link to Napoles.

The two other NGOs on the list that Luy said was created by Napoles (but didn’t have Luy as incorporator) are:

Masaganang Ani Para sa Magsasaka Foundation, which received two PDAF releases totalling P121.78 million.

Pangkabuhayan Foundation Inc – 2 releases, totalling P33.71 million.

In all, Napoles’ 4 NGOs got 12 PDAF releases through Nabcor totalling P405.02 million. They comprised 30% of the total released to questionable NGOs. In fact, the amounts received by Social Development and Masaganang Ani were the first and third highest amounts, respectively, that went to NGOs.

The following names were listed as incorporators and officers of multiple NGOs questioned by COA:

Godofredo Roque

Kabuhayan at Kalusugan Alay sa Masa Foundation

Kaagapay Magpakailanman Foundation Inc

Kasangga sa Magandang Bukas Foundation Inc

Gabay at Pag-asa ng Masa Foundation Inc

Marilou Antonio

Kabuhayan at Kalusugan Alay sa Masa Foundation

Kasangga sa Magandang Bukas Foundation Inc

Gabay at Pag-asa ng Masa Foundation Inc

Marilou Ferrer

Kaagapay Magpakailanman Foundation Inc

Gabay at Pag-asa ng Masa Foundation Inc

Carlos Soriano

The Likhaan Group Inc

Kaagapay Magpakailanman Foundation Inc 

Miraflor Villanueva 

Kasangga sa Magandang Bukas Foundation Inc

Kabuhayan at Kalusugan Alay sa Masa Foundation

Senators’ pork

Rappler also noted interesting releases during election seasons.

In 2007, PDAFs were released to NGOs less than two months before the May 14, 2007, polls, which was in violation of the election ban. A single release amounted to P23 million just five days before the elections.

In the 2009-2010 audit, Kabuhayan at Kalusugang Alay sa Masa Foundation Inc got 10 releases amounting to P65.96 million.

Senators’ pork barrel releases carried interesting stories as well.

In 2009-2010, two senators – Edgardo Angara and Juan Ponce Enrile – allocated their PDAF of P20 million and P15 million, respectively, to an NGO that was formed only in 2009.

The group therefore had no track record, in violation of COA rules.

Senator Jinggoy Estrada released a total of P9.7 million to the Quezon City-based MAMFI in two tranches in 2010. COA noted irregularities in the transaction as well as project implementation.

The check issued for P8.245 million representing 85 % of the project cost was not submitted for audit. Two persons without authorization from the NGO received the checks issued by Nabcor.

Senator Ramon “Bong” Revilla allocated P9.7 million – interestingly, the same amount requested by another group from Senator Estrada – to St. James the Apostle Multi-Purpose Cooperative.

This was “despite its failure to comply with the requisites for entitlement to government funds,” the COA said. The audit agency also found out that the money was deposited to a Land Bank account in Quezon City.

“However, there was no proof submitted that the said account belongs to the Cooperative.” Ninety percent of the total project was immediately released to the cooperative shortly after signing of the MOA between the cooperative and Revilla’s office.

READ: Admin solons linked to pork barrel scam

Pattern of anomalies

A common anomaly cited by COA among Nabcor’s beneficiary NGOs was that they had offices outside the project sites. COA rules require that the NGO should be based in the community where it is implementing a project.  

For example, the office of Napoles’ Social Development Program for Farmers’ Foundation is located in Biñan, Laguna, but its supposed projects were based in Sarangani, Agusan del Sur, Benguet, South Cotabato, Pangasinan, Lanao del Sur, and Masbate.

COA also found that checks issued by Nabcor to the same NGOs were deposited in different account numbers. This may corroborate claims by former employees of  Napoles that they deposited money to Napoles’s personal bank accounts.

Some of the NGOs failed to submit a list of beneficiaries.

READ: Palace: NGOs asking for PDAF to be vetted

As early as its 2008 audit report, COA found that “there were no list of beneficiaries” provided by 17 NGOs that received the pork barrel that year. There were no inspection reports or certificates of project completion.

Despite these deficiencies, however, 8 NGOs continued to receive pork barrel for 2009 and 2010. Napoles’ Social Development and Masaganang Ani.

In its recommendations in the 2011 report, COA issued a “notice of suspension” to all the NGOs covered in the 2009-2010 audit. This was after all its recommendations to address the deficiencies were not implemented by Nabcor and the NGOs. – with Reynaldo Santos Jr/Rappler.com