MANILA, Philippines—Senator Manuel Villar was smoothly dismissive while San Juan Rep. and senatorial candidate JV Ejercito cried “demolition job”.
The two officials were reacting yesterday to a Philippine Center for Investigative Journalism (PCIJ) story that Villar and Ejercito owned secret offshore corporations in the British Virgin Islands (BVI), a privacy and tax haven which is sometimes used to hide illicit wealth and income from corruption, tax evasion and dubious economic activities.
The PCIJ story, released on its website on Friday, was based on an investigation conducted for a year by the Washington, D.C.-based International Consortium of Investigative Journalists (ICIJ), which came up with a partial list of “more than 500 mostly private Philippine residents with ties to offshore corporations”.
Villar and Ejercito did not report their ownership of these offshore corporations in their annual statement of assets, liabilities and net worth (SALN), the PCIJ said.
According to the ICIJ investigation, Villar is the beneficial owner of a BVI-registered corporation called Awesome Dragon Holdings Ltd. (ADHL). It was incorporated in the BVI in July 2007 while Villar was serving as president of the Senate.
The ICIJ report said that Ejercito was a director of a BVI company called Ice Bell Properties Ltd. formed on July 8, 1999, when his father, deposed President and convicted plunderer Joseph Estrada, was still president. Ejercito became the mayor of San Juan, Estrada’s political bailiwick, two years later.
Imee Marcos Manotoc, the daughter of the late dictator Ferdinand Marcos, who was also on the ICIJ list of secretive wealthy Filipinos, was the subject of an earlier PCIJ story. (See related story on this page.)
In his letter in reply to the PCIJ—which his Senate office furnished the Inquirer yesterday—Villar said there was nothing awe-inspiring about a “1-dollar shell company” even if this was being maintained in a reputed tax haven.
He said he did not declare the company in his SALN because it is actually owned by one his companies, Fine Properties, Inc. (FPI).
“While having a BVI company may be abused by some, there is actually nothing sinister about owning one, especially this company that was never used and has a capital of only a single dollar. This is being done by big companies worldwide,” Villar said.
He said FPI has not made any investment in ADHL that would have required registration with the Bangko Sentral ng Pilipinas.
“If and when it will, I assure you that I will see to it that all applicable rules and regulations are complied with. In any case, Fine Properties has been identified in my SALN and listed appropriately,” Villar said.
Villar, the country’s richest lawmaker, explained that ADHL was put in place in 2007 to serve as ready corporate vehicle for any strategic multinational business opportunity that may become available.
“However, this particular shell company is dormant and so it has remained, up to now, a shell company without any asset and with no more than its original capital of one American dollar,” he said.
Villar said that his BVI company has yet to be used for any investment “because I decided to concentrate in the Philippines.”
However, the PCIJ said that contrary to Villar’s claim, ADHL remains active as shown by a check with the BVI Financial Services Commission’s Registry of Corporate Affairs.
Ejercito, whom the PCIJ described as “cocky at worst, cagey at best” in his reaction to the story, released a statement yesterday, which largely reproduced his written reply to the PCIJ.
He said the story was a “clumsy demolition job,” which he lumped together with supposed attacks against two other senatorial candidates of the United Nationalist Alliance (UNA), the coalition under which he is running.
“The timing of this so-called expose is highly suspicious considering I am one of the UNA candidates consistently in the winning list of monthly surveys by different polling organizations and recently barged in to the top 3 in SWS Survey,” he said.
“Since detractors cannot find anything anomalous, onerous or irregular in any contract or transactions during my stint as mayor and as congressman, there is a need to dig into the past,” he said in his Twitter account.
According to the PCIJ, Ejercito “did not squarely address” the question of why Ice Bell Properties Ltd. is not declared in his SALN in his reply to them.
“To the best of my knowledge, I have truthfully and accurately declared all my assets, liabilities, and net worth in my SALN since 2001 when I became mayor of San Juan and up to the present, that I am now a member of the House of Representatives (sic),” he told the PCIJ, which was quoted in a statement his released to the media. With a report from Christian Esguerra