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In This Issue
JANUARY - MARCH 1999
VOL. V   NO. 1


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  P U B L I C     E Y E   —   I N T O   T H E   L I G H T


TAN’S ACTIONS are worth following, if only because they betray a keen understanding of how government works and a knowledge of the chinks in the armor of institutions like the BIR, the Supreme Court and Congress. The remarkable thing is how, after 1986, Lucio Tan was able to get his way with all three, even when there was a hostile president in Malacañang. Tan lawyers employed aggressive legal tactics, bringing on suits and countersuits against individuals and agencies that filed cases against them. They also used dilatory ploys to make cases drag. Moreover, the tycoon’s many opponents allege, those in Tan’s employ bribed legislators, government regulators, even Supreme Court justices. Bert Bacsal, who has known Tan for over 30 years finds these charges preposterous. “How could he get away with all that in a political environment that was hostile and adversarial?” he asks. “These allegations are not only unfounded, they have hardly a speck of credibility.”


 

CONTRIBUTOR

Carlos Arellano
Ramon Cardenas

Florido Casuela

Rufo Colayco
Solomon Cua
Edgardo Espiritu
Jose Pardo

Federico Pascual
Carmelo Santiago

Cesar Virata

Juan Luis Virata
POSITION

Chairman and President/CEO, SSS
Member, Board of Directors, Manila Economic and Cultural Office
President and CEO, Land Bank of the Philippines
President/CEO, Clark Development Corp.
Undersecretary, Department of Finance
Secretary, Department of Finance
Member, Monetary Board, Bangko Sentral ng Pilipinas
President and General Manager, GSIS
Director, Movie and Television Review and Classification Board
Vice Chairman, National Centennial Commission
Director, San Miguel Corp.
CONTRIBUTION

P1,000,000
1,000,000

1,000,000

3,000,000
1,000,000
3,000,000
1,000,000

2,000,000
2,000,000

50,000

3,000,000

But even with a more sympathetic administration in power, Tan doesn’t seem to have let his guard down. The assumption of key government posts by people associated with or known to be friendly to him assures him of legal invincibility. To begin with, there is the president. Tan has not exactly kept it a secret that Erap is his pal, and the well-planned photo ops are apparently meant to advertise a closeness to Malacañang. In a politicized bureaucracy that takes its cue not from the rulebooks but from the capricious exercise of executive power, such perception of coziness opens doors, ensures certain favors, and makes possible a bending of the rules without fear of sanctions.

Tan has also managed to pave the entry of some of his associates into the Office of the President. His former secretary, Rosario Yu, who was seconded to the Estrada campaign, has been appointed presidential assistant and is frequently seen in Malacañang. His second wife’s uncle, Julio Tan, is presidential consultant for Chinese affairs. And his daughter’s father-in-law, steel industrialist John Ng, was recently named presidential consultant on the steel industry.

More importantly, Tan benefits from his close association with the political and financial wizards behind the successful Estrada campaign, the same group, incidentally, that was also responsible for the fiasco that was Ramon Mitra’s 1992 bid for the presidency. The core group of both campaigns was made up of the brothers Ronnie and Manny Zamora, Juan Luis ‘Bubuy’ Virata, and banker Edgardo Espiritu, now finance secretary. Providing grease for their wizardry was Lucio Tan’s money. These men make a formidable team, bound not so much by a common vision but by highly honed skills in the art of financial and political dealmaking. It is their group that now wields tremendous clout in the Estrada administration.

How lucky can Lucio Tan get? His association with Executive Secretary Ronnie Zamora goes back to the martial-law era, when the latter was still Marcos’s assistant executive secretary. Virata, Tan’s long-time financial adviser and the man he put in charge of PAL, is currently deputy treasurer of the ruling party and part of the president’s inner circle. Espiritu was among those briefing the tycoon at his private suite at the Sheraton on the progress of the Mitra campaign in 1992, says Mison.

The finance secretary is close enough to Tan to have recommended his banking colleague Federico Pascual, former vice-president of the Philippine National Bank, to the presidency of Allied Bank. Last year, Pascual was named by Estrada to head the Government Service Insurance System (GSIS). At the same time, Solomon Cua, Espiritu’s business partner, was appointed finance undersecretary.

On his first day in office, Espiritu announced that the tax cases against Tan were “very weak” and “will likely lose.” He went even further to say “there was some kind of violation of due process here” as Tan is among the country’s biggest taxpayers. Not long afterward, Espiritu announced that he was amenable to a compromise with Tan on tax evasion.

In addition, Espiritu appointed attorney Lily Gruba as finance undersecretary. Gruba, admits Mison, happens to have lawyered for Lucio Tan. At the finance department, she is in charge of legal affairs, including the government cases against Tan, and also the task force on Philippine Airlines, which Tan acquired in 1992. Mison finds nothing troubling about this. “Why didn’t anybody object when the Ayalas and the Sorianos put their men in government?” he asks. “Ramon del Rosario was made finance secretary when he was president of Anscor (Andres Soriano Corp.). How come nobody questioned that?”

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