MANILA (Reuters) - A court has ordered a temporary freeze on about 100 bank accounts linked to Philippine tycoon Roberto “Bobby” Ongpin, the country’s ninth-richest man, following charges he obtained preferential loans, court documents show.
The order by the Court of Appeals, at the request of the government’s Anti-Money Laundering Council, illustrates the growing reach of President Benigno Aquino’s anti-corruption drive in a country long plagued by endemic graft.
Ongpin, 75, is a close friend of Jose Miguel “Mike” Arroyo, husband of former president Gloria-Macapagal Arroyo, who was arrested on October 4 on charges of plunder, or high-level corruption, during her 2001 to 2010 presidency.
The court ordered 20 banks and financial institutions to freeze the Ongpin-linked accounts, including 10 directly under his name, for 20 days, according to a copy of the ruling obtained by Reuters.
The freeze can be extended by up to six months on request by the council.
The country’s top banks, including BDO Unibank Inc (BDO.PS), Metropolitan Bank & Trust Co (MBT.PS), Bank of the Philippine Islands (BPI.PS) and local units of foreign banks Citibank N.A. (C.N) and HSBC (HSBA.L), were directed by the court to freeze the accounts in its resolution dated December 6.
Aquino’s anti-corruption campaign is intended to strengthen governance and shore up confidence in the Philippine economy, long derided as the “sick man of Asia”.
Investors have lauded the results so far. The Philippine stock market is Asia’s best performer this year with a more than 30 percent rise. Data last week showed the economy surging 7.1 percent in the three months to September from a year earlier, the best performance in Southeast Asia.
As foreign investors return, Aquino faces pressure to go beyond usual half-hearted attempts to fix a stifling, graft-plagued bureaucracy and find new streams of revenue in a country whose earnings usually end up in the hands of the elite.
His pursuit of graft allegations against Arroyo and her associates are widely seen as a critical test that could determine whether the Philippines moves ahead or withers again as a choice for investors after a brief spell of optimism.
Ongpin, trade minister under late strongman Ferdinand Marcos, is emerging as a target of investigators.
He is the country’s ninth-richest man with a net worth of $1.5 billion, according to Forbes magazine. And his investments cut a broad swathe through the economy. He is the largest single investor in the country’s biggest conglomerate, San Miguel Corp (SMC.PS), via his firm Top Frontier Investment Holdings, with a 37 percent stake.
Ongpin, a Harvard Business School graduate and certified accountant, was not immediately available for comment for this story. His assistant, Josephine Manalo, whose bank accounts were frozen by the same order, was also not immediately available.
NOT A ‘CRONY’
A Senate committee is investigating allegations that Ongpin’s company obtained “behest loans,” or loans with preferential terms, of around 660 million pesos ($16 million) from the state Development Bank of the Philippines in 2009, while Arroyo was president.
At a hearing last year, Ongpin defended his relationship with Arroyo’s husband. He said Mike Arroyo was his friend before his wife became president in 2001. “But friendship does not mean I was his crony,” Ongpin said.
Arroyo, the country’s longest serving president under a democratic regime, is detained at an army hospital on cases of plunder and graft. She has denied the charges.
Earlier this week, the Ombudsman’s office which prosecutes corruption cases dismissed 13 officials at the Development Bank of the Philippines for loans granted to Ongpin’s Delta Ventures Inc in 2009.
Ongpin used the money to acquire a stake in top mining firm Philex Mining Corp (PX.PS), which he sold weeks later for a 65 percent gain to Hong Kong’s First Pacific Co Ltd (0142.HK), according to stock exchange filings.
In the December 6 order, the court also froze 60 other accounts of the dismissed officials of the Development Bank of the Philippines and its former directors and board members.
Additional reporting by Karen Lema and Erik dela Cruz; Editing by Jason Szep and Muralikumar Anantharaman