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In February , close to two years after the approval of the Westinghouse proposal, the two parties formally signed the final contract.

The U. The final contract revealed three significant changes from the original proposal. Second, the parties agreed to transfer the site from Bagac, which was found to be more vulnerable to tidal waves, to Morong, which was 18 metres above sea-level but nearer a volcano.

The site transfer led the parties to design a facility that could withstand an earthquake with a magnitude of 7. Safety considerations for the site transfer raised the cost of the original contract.

Lastly, the contract changed the scope of work for Westinghouse. Initially, it was understood that Westinghouse would only provide design engineering and project construction management services.

Herminio T. Disini et al. It is not clear how much commissions Disini and by extension, Marcos received from Westinghouse. As sums were paid to him, no bribery of top-level Philippine government officials including Marcos was proven, which might have otherwise made Westinghouse legally liable under the U.

Foreign Corrupt Practices Act of Disini's profit from the BNPP project was not limited to commissions. His companies also engaged in underwriting insurance, construction, distribution of Westinghouse products and services as well as the setting up of communications for the power plant project Matthews and Wideman, Further, Disini intervened to make Citicorp the lead manager of the syndicated loan partly financing the BNPP despite a presidential decree that originally gave the role to American Express Bank Butterfield, In an interview with the Washington Post in December , Marcos reportedly said that the decision to buy the Westinghouse plant was made based on a report by foreign technical consultants and that was before Disini's involvement with Westinghouse.

That explanation did not stop U. In response, Marcos ordered the Ministry of Energy and Ministry of Justice to investigate Disini's involvement in the award to Westinghouse Butterfield, He also directed the government takeover of three Disini firms, in which the government had substantial financial exposure.

Then Press Secretary Francisco Tatad explained that the takeovers were done not because of any wrongdoing by Disini but because the government had large investments in the three companies Mathews and Wideman, In , in the midst of an international recession and piling debt, many crony empires, including Herdis, collapsed.

This led Marcos to order the government bailout and takeover of 13 major Herdis companies and transferred them to the government-owned National Development Company Branigin, In , Disini fled to Austria, a country without an extradition treaty with the Philippines.

There, he allegedly acquired citizenship and a castle. The TMI accident caused a partial nuclear meltdown, therefore raising alarm worldwide about the safety of nuclear energy.

Consequently, the U. By virtue of Executive Order No. The commission, otherwise known as the Puno Commission because it was headed by then Justice Minister Ricardo Puno, submitted its report in November , recommending the continuation of plant construction subject to the incorporation of additional safety features in the revised design Republic of the Philippines, , p.

For its part, in August , the Philippine Atomic Energy Commission PAEC , the country's nuclear regulatory body, submitted its own re-evaluation study, which recommended the lifting of the construction suspension order.

These developments arising from the TMI accident ultimately resulted in a sharp spike in project cost mainly due to interest charges, inflation, foreign exchange losses and costs of additional safety requirements.

However, political considerations led Marcos to postpone operations until after the snap elections. Based on the Bureau of Treasury's statistics on debt service for the period —, Table 1 shows that the country paid a total sum of PhP Of the total amount of payment, PhP The complaint, known as Civil Case No.

Later that year, the Aquino government sued Westinghouse and its engineering subcontractor, Burns and Roe, for bribery, fraud and racketeering before a federal district court in New Jersey Butterfield, Westinghouse, however, convinced the court that the case should stay pending arbitration by the International Chamber of Commerce in Switzerland, as provided in the BNPP contract Republic of the Philippines vs.

Westinghouse Electric Corporation , In , the Swiss arbitration panel cleared Westinghouse of bribery charges United Press International , In May , the federal court jury in New Jersey also reached a verdict exonerating the two American companies.

In , while cases in Switzerland and in a U. In contrast, the civil suit against Disini dragged on for a longer time. It took 25 years before the court could resolve Civil Case No.

During the early course of its investigation, the PCGG successfully convinced former Herdis executives to be whistle-blowers.

Jacob had claimed that Disini's commissions were deposited in his personal Swiss bank accounts and not to Herdis' accounts.

Thus, in , then Ombudsman Simeon Marcelo filed two criminal cases against Disini, one for bribery and the other for violation of Section 4 a of the Anti-Graft and Corrupt Practices Act, which prohibits a private individual from exploiting close personal ties with a public official in order to gain some pecuniary or material advantage.

Consequently, Disini was arrested but was later released on PhP54, bail. However, despite establishing the fact that Marcos and Disini were close associates and relatives by affinity and that Marcos acted in favour of Disini as Westinghouse's special agent, the court could not find preponderant evidence that the Marcoses received any commissions from the deal.

Recovery of the Disini commissions has been made even more uncertain after his death in The government's deal in with the Zhongxing Telecommunications Equipment ZTE Company, a Chinese state-controlled firm, is another political controversy arising from a dubious big-item procurement — the NBN project.

It is a complicated case arising from the quarrel for profit and commissions between two competing groups with powerful political sponsors.

At the time of the scandal, the unpopular GMA administration was already beleaguered by other election-related controversies, such as the Hello Garci scandal and the Fertilizer Fund Scam.

De Venecia's group, Amsterdam Holdings, Inc. Later, Joey De Venecia led in exposing anomalies in the deal. On 11 September , acting on a complaint from a House representative, the Supreme Court issued a temporary restraining order for the project.

Despite the contract's cancellation, the SBRC decided to continue its investigation. Two years later, it recommended further investigation with the view of filing graft charges against the president and her spouse, House Speaker de Venecia and his son, Comelec chairman Abalos, NEDA Secretary Romulo Neri, some whistle-blowers and other government officials involved SBRC, , pp.

His friend and technical adviser, Rodolfo Lozada, was sent to Hong Kong to avoid testifying before the Senate.

In October , amidst the Senate inquiry, Abalos resigned from his post as the Comelec chair. Based on this agreement, the Philippine government signed an memorandum of understanding with ZTE, allowing the latter to invest in information technology projects in the Philippines, including the NBN project SBRC, , pp.

In September , China's Export—Import Bank indicated its intention to fund the project as a loan to the Philippines. The two proposals bore different implications in terms of ownership and control.

AHI's BOT scheme meant that the private company would run the enterprise until its agreed date of transfer to the government. In contrast, the ZTE proposal meant that the broadband network would be owned and operated by the Philippine government while the procurement of equipment, services, and financing would come from China People of the Philippines vs.

Arroyo et al. The SBRC report suggested several improprieties committed by government officials and private individuals in the deal. At the centre of the political controversy were Comelec Chair Abalos and FG Arroyo, alleged brokers who received commissions for their services.

Both Abalos and Arroyo, as a private individual though married to the president, had no official capacity to intervene in the deal.

Testimonial evidence established Abalos' lobbying and bribery attempts. The SBRC report also found it improper for the president to be playing golf and having lunch at ZTE's Shenzhen headquarters in November since the company was lobbying for a contract.

It further pointed out the president's tolerance of corruption, as she knew about Abalos' bribe offer to Neri as well as other irregularities in the broadband contract SBRC, , pp.

Nevertheless, he showed his hand at influencing government by inviting the DOTC Secretary Mendoza for breakfast at his home.

The SBRC argued that both he and his son attempted to commit graft since by law, relatives of the House Speaker up to the third civil degree, were not supposed to intervene or engage in a business, transaction or contract with the government.

Ombudsman Merceditas Gutierrez was Mike Arroyo's schoolmate in one of the country's prestigious universities. Prior to her appointment as Ombudsman, she was GMA's former justice secretary.

The persecution of GMA and other government officials began. The House of Representatives impeached Ombudsman Gutierrez and she resigned in April before the conviction trial at the Senate.

It should be noted that, contrary to tradition, it was the retiring Carpio-Morales who swore in Aquino as president and not then Supreme Court Chief Justice Renato Corona.

Court of Appeals. Department of the Interior and Local Government. Euro Generals scandal — involves Eliseo de la Paz and several Philippine National Police officials who went to Russia in October to attend the Interpol conference.

De la Paz was detained for carrying a large sum of undeclared money. Pimentel III vs. Zubiri Senate Electoral Protest — Atty.

Maguindanao massacre — involves the Ampatuan family and several others for the kidnapping and killing of 58 people in Ampatuan, Maguindanao.

Manila hostage crisis — former president Benigno Aquino III 's first term was marred by violence when eight Hong Kong tourists were killed by a disgruntled former police officer Rolando Mendoza, after a bungled hostage rescue attempt by the Manila Police District.

The incident also strained ties between the Philippines and Hong Kong. Department of National Defence. Angelo Reyes and several other retired military officials.

Priority Development Assistance Fund scam — involving businesswoman Janet Lim-Napoles and several other linked politicians.

Office of the President , Senate , House Representatives. Office of the Vice President. Jejomar Binay's alleged corruption scandal — involving former Vice President Jejomar Binay and several others for the alleged overpriced contract for the multi-billion-peso Makati City Parking building II.

Department of Transportation. Ninoy Aquino International Airport bullet planting scandal — involving the employees of Office for Transportation Security for accosted and fined for possessing bullet ammunition to the passengers.

Department of Justice. New Bilibid Prison drug trafficking scandal — involving former Justice Secretary , now Senator Leila de Lima and several other government officials linked to illegal drug trade at the New Bilibid Prison.

Manila Police District secret jail cell scandal — involving officers of the Manila Police District for the discovery of the so-called 'hidden jail', measuring five-feet wide, behind the bookshelf, which contained about 12 prisoners and it was poorly ventilated, except for an exhaust fan in a raid led by the members of the Commission on Human Rights in Tondo, Manila.

Department of Finance. Andres Bautista's alleged corruption scandal — involving former Commission on Elections chairman Andres D.

Bautista after his estranged wife, Patricia, accused him of amassing unexplained wealth. Office of the President , Cabinet. Dengvaxia controversy — involving former president Benigno Aquino III , Health Secretary Janette Garin and Budget and Management Secretary Florencio Abad for the launching of the mass vaccination campaign in , that led to the reports of several children dying from various complications allegedly attributed to the dengue vaccine.

Department of Tourism. Department of Finance , Department of National Defense. Nicanor Faeldon , Antonio Sanchez. Oscar Albayalde and several other officers for an allegedly anomalous anti-drug operation in Mexico, Pampanga on November 29, This forced a number of medical and hospital staff, who believed to have had contact with the senator, to quarantine.

Department of Labor and Employment. Both by Ambeth Ocampo. Arnold takes a swipe at solons. Meghan Markle opens up about overcoming fear when making big decisions.

Istanbul authorities ban Kurdish-language play. Birdwatch: the curlew sandpiper — a visit from a restless global traveller.

Mel, nagbabalita nang nakayapak. Quezon City molecular lab passes DOH proficiency test. IMF further downgrades economic outlook for the Philippines, projects a deeper 8.

Kim Kardashian wore a bikini and sat inside a giant birthday cake to announce her latest makeup collection. A man who lives alone in an airplane hangar in a Utah ghost town has found the ultimate escape.

Daniel Padilla thanks Kathryn. PHL virus tally nearing K. Spain go down to surprise Nations League defeat in Ukraine. Taraji Henson, Killer Mike win awards for causes.

SMC completes Skyway 3, to start work on Bulacan airport by yearend. Supreme Court allows Trump to wind down census early.

Ibuprofen vs. Angelica on being ghosted. Sino si Lord Allan Velasco? Great new music from the girls.

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What really happened on June 2, , she would rather forget than remember. In late October , the Net was abuzz with the fact that there were four video clips posted online showing sexy actress Criselda Volks and her boyfriend in an intimate moment.

Scandal Status: Real Somewhat confirmed by at least one party who is directly involved. In , a video clip surfaced of comedienne Ethel Booba stimulating herself, with her then boyfriend, basketball player Alex Crisano holding the cellphone used for filming the supposedly private scene.

A Manila Bulletin Online article explained: " The sex video leak came about after Crisano had his cellphone repaired at a shop in Greenhills and the technician apparently saw the clip.

Crisano has reportedly threatened to get even with the technician. We use cookies to ensure you get the best experience on Spot.

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Already a member? Log in. No account yet? Create Account. Completing your profile entitles you to the latest updates, invitations to special events, and cool downloadable freebies!

Register via Facebook. Log In using Facebook. Log In via Email. Email Address. Hello Garci scandal — scandal involving Pres. Gloria Macapagal Arroyo on committing electoral fraud during the National Elections.

Office of the President , Department of Agriculture. Gloria Macapagal Arroyo , Jocelyn Bolante. Court of Appeals.

Department of the Interior and Local Government. Euro Generals scandal — involves Eliseo de la Paz and several Philippine National Police officials who went to Russia in October to attend the Interpol conference.

De la Paz was detained for carrying a large sum of undeclared money. Pimentel III vs. Zubiri Senate Electoral Protest — Atty. Maguindanao massacre — involves the Ampatuan family and several others for the kidnapping and killing of 58 people in Ampatuan, Maguindanao.

Manila hostage crisis — former president Benigno Aquino III 's first term was marred by violence when eight Hong Kong tourists were killed by a disgruntled former police officer Rolando Mendoza, after a bungled hostage rescue attempt by the Manila Police District.

The incident also strained ties between the Philippines and Hong Kong. Department of National Defence. Angelo Reyes and several other retired military officials.

Priority Development Assistance Fund scam — involving businesswoman Janet Lim-Napoles and several other linked politicians.

Office of the President , Senate , House Representatives. Office of the Vice President. Jejomar Binay's alleged corruption scandal — involving former Vice President Jejomar Binay and several others for the alleged overpriced contract for the multi-billion-peso Makati City Parking building II.

Department of Transportation. Ninoy Aquino International Airport bullet planting scandal — involving the employees of Office for Transportation Security for accosted and fined for possessing bullet ammunition to the passengers.

Department of Justice. New Bilibid Prison drug trafficking scandal — involving former Justice Secretary , now Senator Leila de Lima and several other government officials linked to illegal drug trade at the New Bilibid Prison.

Manila Police District secret jail cell scandal — involving officers of the Manila Police District for the discovery of the so-called 'hidden jail', measuring five-feet wide, behind the bookshelf, which contained about 12 prisoners and it was poorly ventilated, except for an exhaust fan in a raid led by the members of the Commission on Human Rights in Tondo, Manila.

Department of Finance. Andres Bautista's alleged corruption scandal — involving former Commission on Elections chairman Andres D.

Bautista after his estranged wife, Patricia, accused him of amassing unexplained wealth. Office of the President , Cabinet. Dengvaxia controversy — involving former president Benigno Aquino III , Health Secretary Janette Garin and Budget and Management Secretary Florencio Abad for the launching of the mass vaccination campaign in , that led to the reports of several children dying from various complications allegedly attributed to the dengue vaccine.

Department of Tourism. Department of Finance , Department of National Defense. She also cleared GMA's husband.

In , when the prevailing political fervour was against the former president, her successor Ombudsman Carpio-Morales, hastily filed charges against the Arroyos, Abalos and Mendoza.

Insufficient evidence to graft charges led to the Sandiganbayan ' s exoneration of the accused in August In an earlier court decision, the Supreme Court also acquitted Arroyo for lack of evidence in a plunder case involving the alleged misuse of intelligence funds of the Philippine Charity Sweepstakes Office Macapagal-Arroyo vs People of the Philippines , The petition was filed in July by Carpio-Morales.

A politically subservient or accommodating judiciary might be argued to be the fifth element in the legal settlement of both corruption scandals.

Aquino was of course against Marcos and his cronies. It was also during his term that criminal charges were filed against GMA. The Sandiganbayan ' s ruling on the ZTE case, issued in the early days of the Duterte presidency, favoured the Arroyos and other co-accused.

Her remark was suggestive of the political malleability of the courts. Sixth, both projects contained the element of foreign government participation, therefore entailing diplomatic considerations.

In this regard, the government had to take utmost care of relevant, confidential information in order to prevent scandals from erupting and harming diplomatic relations.

It was therefore possible that discovered irregularities made it difficult for the governments involved to publicly acknowledge or outrightly denounce the projects.

Export—Import Bank. It was also involved indirectly through the support of its nuclear export industry and support of private banks.

To dismiss the Disini connection in the Westinghouse deal, Marcos explained that the decision was based on an earlier report of foreign consultants.

Further, in reaction to the U. To be sure, authoritarian rule prevented the discovery of other incriminating evidence on the legal improprieties of the BNPP contract.

However, no amount of damage control could erase the image of the BNPP project as a symbol of Marcos' corruption. The Arroyo government's damage control included the cancellation of the NBN—ZTE contract as well as the suppression of key witnesses e.

Neri from disclosing sensitive information to the public. However, such measures only fuelled further public suspicions and strengthened the justification for the SBRC's prolonged investigation of the scandal.

What obviously contrasts the two projects is that the ZTE contract never pushed through unlike the BNPP, whose liabilities had to be settled for decades.

The ZTE project cancellation was the product of the system of checks and balances in post-Marcos democracy, with pressure exerted by the mass media, Congress, the courts and public opinion.

However, this system of checks and balances has not guaranteed the absence of grand corruption in the country. Despite the Government Procurement Reform Act of , which mandates that all government projects to undergo competitive public bidding, the apparent loophole revealed by the ZTE—NBN experience was the government-to-government agreement, which provided an exception to the general rule.

That rules could be changed and broadly interpreted to favour particularistic interests does not bode well for the promotion of a culture of accountability and integrity in government in the Philippines.

Such projects, extending to national roadworks and other major undertakings, are often susceptible to political interference for the private gain of public officials Batalla et al.

The constancy of grand corruption scandals in the Philippines suggests deeper problems in politics and society. First, many government institutions remain malleable to negative external influences.

Despite governance reforms through decades of restored democracy, many government institutions are still easily influenced by powerful vested interests.

Second, strong incentives to commit graft persist. Such incentives are not only exclusive to politicians, political appointees and professional bureaucrats but also to foreign governments, private firms and individual brokers.

The persistence of corruption incentives in many government institutions draws from underdeveloped governance measures, the prevailing culture of corruption, low civil service wages and the low risk of detection with a promise of high returns Quah, , pp.

With the exception of the conviction of President Estrada for plunder though later pardoned by Arroyo , no other high-ranking official above the position of provincial governor has ever been convicted of corruption Bolongaita, At best, high-ranking officials accused of corruption have been shamed and jailed.

The failure of closure of past scandals encourages corrupt practices by top officials, who regard government as a lucrative source of private wealth and power.

The scandals provide a constant reminder of the long unattended opportunity of effectively reforming the political system. National Power Corporation-Philippine Nuclear Power Plant interest payments and principal amortization, — in million pesos.

Source s : The author's calculations are based on the online statistics on national government debt service provided in the Bureau of the Treasury Batalla , E.

Beaver , W. Bolongaita , E. Branigin , W. Butterfield , F. Chang , E. Coronel , S. David-Barrett , E. Dumaine , B. Hutchcroft , P. Kukutschka , R.

Lowi , T. Macapagal-Arroyo, G. Manapat , R. Mathews , J. Mydans , S. Panganiban , A. People of the Philippines vs. Desierto, Ananiano, Herminio T.

Disini, Liliana L. Quah , J. Republic Act No. Republic of the Philippines , Letter of Instructions No. Republic of the Philippines vs.

Disini, Herminio et al. Rimando , L. Sabangan , A. Salaverria , L. Suplico, R. Tiglao , R. Velasco , G. The author thanks Professor Jon Quah for his editorial initiative and support for this work.

Thanks are also due to Emil Bolongaita and Cleo Calimbahin for their useful comments and suggestions. Eric V. He is co-editor of the Routledge Handbook of the Contemporary Philippines and the author of several journal articles and book chapters on regional and Philippine politics, corruption and economic development.

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