An audit of a large development project, Xevera Mabalacat and a similarly named one in Bacalor, has exposed a massive fraud centered on loans being granted to "ghosts", who were actually real people unaware the loans for houses had been taken in their names.
The loans were taken out by the developer, Globe Asiatique Realty Holdings Corp, earlier this year and authorized by Pag-IBIG validators who handled their cases.
In a major investigation by the Philippine Daily Inquirer, Globe Asiatique has breached several warranties or commitments it promised to fulfill as an accredited developer of houses, and both it and Pag-IBIG have been shown to have colluded in the process.
Globe Asiatique or its brokers who put in the loan folders of the "ghosts" committed “misrepresentation,” Pag-IBIG documents showed. Some of the loans have been shown to be made to dead people.
The official, who did not want to be identified for fear of losing his job, declined to cite numbers, but Jaime Fabiaña, chief executive officer of Pag-IBIG, confirmed the existence of spurious accounts when a conflict arose between him and Globe Asiatique president Delfin Lee in June.
Defending the agency from Lee’s criticisms of a memorandum that stopped instant membership in Pag-IBIG, Fabiaña, in a statement, said: “Abuses have been committed, particularly in the Pampanga area, including Mr. Lee’s Xevera projects, where almost 400 approved accounts were confirmed to be doubtful because the borrowers denied they availed themselves of the housing loans.”
At P750,000 each, these loans were worth P300 million.
Fabiaña said Lee wrote him and admitted to monitoring some 1,000 accounts that might belong to “questionable buyers.”
Inquirer sources in Pag-IBIG had tallied more than 800 fake members in Globe Asiatique accounts as of June 30. They said there could be more because loan approval took only one to three days, much quicker than the seven days allowed in contracts-to-sell scheme.
“Dati, daraan ka sa butas ng karayom (Back then, it was like passing through the eye of a needle),” said a Pag-IBIG employee, referring to a time when loan applications took five to six months to be approved.
Special arrangements
Lee said the OWG program and its adjusted rules, including the reduction of membership requirements, were offshoots of a “compromise” between him and former Pag-IBIG chief executive officer Romero Quimbo.
Lee said he and Quimbo arrived at the “special arrangements” after then Vice President Noli de Castro, who served as chair of Pag-IBIG Fund, stepped in to resolve the row arising from Lee’s complaint that Quimbo was giving him a hard time collecting loan proceeds for houses Globe Asiatique built in the Xevera projects.
“That was the reason we have a special MOA. We had this OWG category, a new membership category that was started because of my complaint,” he said.
Rules eased
Told that several rules were eased contrary to what Pag-IBIG’s Circular No. 237 prescribed, Lee said: “This circular is their internal guideline, which they can always change according to their wishes. In our case, I figured we have to come up with special arrangements but in return I will guarantee this account for five years. It was approved even by the [Pag-IBIG] board...[But in reality] it need not go through the board because what were at stake were managerial and operational issues.”
Problems appeared in the post-validation of membership registration.
Ineligible, missing
In the March 2, 2009, batch of 794 registered members, at least 55 were verified to be ineligible for membership, 111 could not be located and 5 refused to be interviewed.
In the batch of 872 members on March 9 this year, 60 were verified to be ineligible, 121 could not be located and 5 refused to be interviewed.
Several lists showed these members to be unemployed, students, dependent on remittances of relatives abroad, or had committed forgery.
Dead upon application
Others were dead at the time of loan application, proven to be non-occupants at the Xevera projects, not known to be living in the address given, no longer residing there or not around at the time of the validation.
Lee said the buying of signatures from bogus borrowers “could happen,” but said there was no way he could check if it was happening.
“It’s OK if a borrower uses the names of other people [for additional units] as long as he is paying, there is no problem,” he said.
Commenting on members who could not be located, Lee turned blunt. “I am responsible for everything. What is important is they are paying,” he said.
The occupancy rate in the Xevera housing projects is 70 percent, which Lee considers “very high.” Having errant brokers is unavoidable, he said.
“Misrepresentation, there might be...If you say there are 3-5 percent wayward brokers, there is no way for us to check. But the control we put in is once the borrower defaults for three months, we cancel their contracts to sell,” Lee said.
Deficiencies
Globe Asiatique also took out the loan proceeds although the houses had yet to be finished, as Pag-IBIG discovered in its “post-inspection.” An inspection is done after loan proceeds were taken out by a developer and a house was transferred to a borrower for occupancy.
A May 20, 2010, memorandum showed that between March 5 and May 14, at least 1,521 of 1,733 units in Xevera Mabalacat had yet to be finished.
Pag-IBIG issued notices of buyback only for 16 accounts because no units were built in the first place.
When Bayani Garcia, San Fernando branch manager of Pag-IBIG, realized in post-inspections that the units were “incomplete and have noted material/major deficiencies,” he asked the regional operations cluster, headed by Sergio Andal Jr., for advice to conduct pre-inspection.
“We have already served several notices and demands to Globe Asiatique to complete the said findings and warned them that said acts [are] in violation of our funding-commitment agreement and Pag-IBIG Fund guidelines,” Garcia said in a memorandum.
The agency should not have released the loan proceeds to Globe Asiatique when documents were lacking or false, he said.
The documents should include a sworn affidavit that the “lot has been fully developed and that the house construction has been completed.”
In cases like these, the borrower is disadvantaged. While the funds assigned to him as loan go directly to the developer, he is not yet guaranteed oerves as collateral for the loan.
“Considering that these incidents became recurring and as the guidelines provided that all units subject for takeout be fully complete, it might be possible that the housing units of the future housing loan application deliveries of Globe Asiatique have uncompleted units,” Garcia said.
The pre-inspection, as proposed by Garcia, was not approved, causing dissatisfaction in the agency. Garcia has been reassigned to the Pag-IBIG office in Calamba City in Laguna.
Globe Asiatique quickly finished the construction of clubhouses and other amenities that became the top attractions of its housing projects, but not the units, which were the objects of the loans.
The company’s other projects include the GA Twin Towers beside EDSA in Mandaluyong City, GA Sky Suites in Quezon City, the Villas at the Enclave in Pampanga, and Sta. Barbara, St. Monique, and Casa Ibiza in Rizal province.
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