Post-Marcos Cleanup Tarnished : Philippine ‘Fraud Squad’ Faces Corruption Charges

Times Staff Writer

Like a modern-day Eliot Ness, government prosecutor Francisco Chavez has sat in the witness stand of the Philippine Senate for the last two weeks speaking the unspeakable.

Wearing suspenders and striped tie and jabbing the air with his cigarette during the continuing series of daily Senate hearings into public corruption under President Corazon Aquino, Chavez has drawn a road map of what he calls “incompetence, ineptness and corruption.”

And, as if such charges from Aquino’s own solicitor general were not bad enough for a president whose personal image of honesty and sincerity remains untarnished, the target of Chavez’s allegations has been the very panel that Aquino established as her first official act after the “People Power” revolution of 1986: the Presidential Commission on Good Government, which was to investigate corruption and graft under deposed President Ferdinand E. Marcos.

In short, according to Chavez and many other Aquino allies who have added their voices to the crusade in recent days, in the 36 months since the commission was created as the Aquino administration’s “avenging angel,” it has become something of the opposite.


In a whistle-blowing campaign that began nearly two months ago, Chavez--a dynamic and articulate young lawyer who fought alongside Aquino to end Marcos’ two decades of corrupt and authoritarian rule--has described the commission as “a mud house tilting toward self-destruction.”

The commission has used its unchallenged powers to sequester cash assets and real property of more than 350 companies that its investigators suspect were illegally acquired by Marcos and his cronies.

But, in his testimony, Chavez has outlined a litany of apparent graft, corruption, inefficiency and incompetence on the commission’s part that, if proven in court, would represent tens of millions of dollars in assets seized by the commission and then misappropriated.

The alleged wrongdoing includes the disappearance of millions of dollars of stock and cash from the corporations seized by the commission. Thousands of sequestered cattle worth millions of dollars also are missing--"turned into corned beef already,” Chavez commented wryly. Also unaccounted for are six aircraft, the proceeds from the sale of 999 million shares in one company and the apparent theft of $1 million in equipment from a sequestered oil-exploration firm. Among the booty in that case was a ship.


The ramifications of Chavez’s testimony, which he cautions must still be fully investigated by the government, have been profound for Aquino’s young and still struggling government.

Panel Resigned

Although only one of the commission’s members and none of its 229 employees have been charged criminally, all of its commissioners resigned two weeks ago. Aquino, who has publicly declared her desire to purge all corruption from her government, has given Chavez a free hand and ordered him to continue until all guilty parties are identified and punished.

But, in the hands of Aquino’s critics, the charges already have tarnished the crusade to recover Marcos’ hidden wealth, and they have contributed to mounting criticism that corruption has proven as impenetrable under Aquino as it was under the dictator she helped to overthrow.


The widely aired allegations against the commission now also threaten to derail two pending criminal indictments of Marcos in the United States and Switzerland, forcing Aquino into a balancing act between her stated desire for honesty and public accountability and the risk of subverting her government’s attempt to recover billions of dollars that the nation desperately needs.

Noting that lawyers for Marcos and his cronies have filed petitions for dismissal of the pending charges by using as justification the disclosures of corruption within the panel responsible for those charges, Senate President Jovito Salonga, who was the commission’s first chairman, said, “Sometimes we are fond of self-flagellation.” Salonga called on Chavez and the government to “do our . . . housecleaning without prejudicing the search for ill-gotten wealth.”

‘Acting Like Piranhas’

Prominent political analyst Amando Doronila stated it more strongly: “The Filipinos, as a people, are acting like a school of piranhas, devouring each other in a collective suicidal pact.”


But Doronila, who has written three front-page columns on the issue in his respected newspaper, the Manila Chronicle, also has echoed the sentiments of many, both within and outside Aquino’s 31-month-old government, in cautioning the Filipinos and the world against using the scandal to be overly harsh on the Aquino government.

“It is unfair to blame the presidency for direct intervention in promoting corruption. It is even more unfair--and a gross departure from fact--to allege that corruption today is as bad as it was during the Marcos years.

“Corruption is not a government policy, unlike in the Marcos regime. . . . And corruption is an issue that will not sink her (Aquino’s) government right away. But it opens leaks in the vessel of government.”

Indeed, even Chavez has stressed that no more than 20% of the commission staff are “rotten eggs.” And, in an interview with The Times, he added, “I still believe in the commendable task of running after Marcos’ hidden wealth. I believe there can be a fresh start for the commission.


“And it would be unfair to come up with a generalized type of conclusion on the performance of Cory Aquino’s presidency as a result of these disclosures.”

Still, Chavez’s crusade has been like a lightning rod on the corruption issue, coming at a time when Aquino’s closest supporters and advisers have been publicly blasting Philippine society’s continuation of the corrupt practices that were commonplace under Marcos.

Cardinal Jaime Sin, the primate of this overwhelmingly Roman Catholic nation who also played a key role in driving Marcos into exile and bringing Aquino to power, put it this way recently, “Ali Baba is gone, but the 40 thieves have been left behind.”

In a recent Sunday sermon read in Catholic churches nationwide, Sin commented on the widespread anger caused by the continuing corruption.


“For weeks the papers, radio and television have shouted nothing else,” declared Sin, who, along with Aquino, had called for a new moral order when Marcos left. “I myself have spoken often enough of the 40 big thieves left behind in our midst, and the many, many smaller ones, who might include even ourselves.”

In an attempt to bring the concern even closer to home for Aquino, Chino Roces, the respected, aging Manila publisher who spearheaded a 1985 petition drive to gather the 1 million signatures that persuaded Aquino to challenge Marcos at the polls, threatened to start yet another signature campaign urging the government to get tougher on corruption.

Aquino’s critics in the right-wing opposition, not surprisingly, have been more vociferous on the corruption issue.

“The Commission on Good Government was to be both the Holy Grail and the avenging sword of the Aquino administration, but now it is the general perception that the commission, in running after Marcos’ corruption, had become corrupted in the process,” said Blas Ople, a still-respected political consultant who, despite serving for nearly two decades in Marcos’ Cabinet, remains untouched by the hidden-wealth issue.


“The solicitor general’s public indictment of this institution has made that perception official. And now, I’m afraid, the commission is mortally wounded. The avenging angel is now a fallen angel.”

Through all the recent headlines and critical political speeches in a nation that loves scandal, though, there has been little discussion of the roots of the corruption.

Most analysts who have dug below the surface conclude that much of the graft can be traced to the obvious causes of lingering poverty, low salaries for public officials and the fact that much of the government’s civil service bureaucracy could not be removed after Marcos left.

Sen. Teofisto Guingona, another staunch political street fighter who helped bring down Marcos and who is chairing the continuing Senate “blue ribbon committee” hearings on Chavez’s charges, explained why he thinks the corruption scandal is raging.


“First, we have a free media, and secondly the policy of transparency adopted by the government has combined with a third factor, the Aquino administration’s corrective measures, such as open-forum investigations, to make this seem much bigger than it is. . . . But there is the fourth reason. Unfortunately, we have not learned the lessons of martial rule or dictatorship, that something corrupts a man when he comes into power.”

For Solicitor General Chavez, though, the causes of the scandal are far more specific and pragmatic. When the commission was created, he said, it was lax in its hiring practices, requiring neither experience, fidelity bonds nor legal oaths by the agents it hired and assigned to run the sequestered corporations.

“I don’t think there was a deliberate effort to set it up that way so money could be stolen,” he said. “It was more that the ineptness and incompetence created the atmosphere in which corruption could grow.”

On a deeper level, Chavez said the continuing corruption “is some kind of a carry-over of what has become a secret industry in this country. A lot has to be done to regenerate the moral fiber of the Filipino people.”


Chavez, a political independent who says his crusade already has earned him dozens of death threats and one attempt on his life, vows to continue his campaign throughout the other departments of government.

“I’m sorry to disappoint them,” he said of the four armed men who stopped his car on a busy Manila intersection one recent day, only to find that he was not inside. “I will not be intimidated, and I will not stop this fight.”

Chavez said his trademark appearance of suspenders, long-sleeved white shirt and striped tie predates his anti-corruption campaign and is not a deliberate imitation of Eliot Ness, the corruption hunter most famous for putting Chicago gangster Al Capone behind bars in the 1930s. But, acknowledging that he knows of Ness’ career, he said, “I can’t stand corruption, and I am trying hard to breed a whole crop of ‘Untouchables’ here.”

The analogy has not been lost on the Philippine media. In a nation that loves its humor even more than its scandals, the national press has dubbed Chavez “Eliot Inis .” Inis is the Tagalog word for a relentless and annoying pest.