“Respondent committed culpable violation of the Constitution and/or betrayed the public trust when he failed to disclose to the public his statement of assets liabilities and net worth (SALN) as required under Sec. 17 Art. XI of the 1987 Constitution.”
- 2.1 “ A public officer shall … submit a declaration under oath of his assets, liabilities and net worth. In the case of the President, Vice-President, the Members of the Cabinet, and other constitutional offices, the declaration shall be disclosed to the public in the manner provided by law”.
- 2.2 Respondent failed to disclose to the public his statement of assets, liabilities and new worth, in violation of the Anti-graft and Corrupt Practices Act.
- 2.3 It is also reported that some of the properties of the Respondent are not included in his declaration of assets, liabilities and net worth.”
- 2.4 Respondent is likewise suspected and accused of having accumulated ill-gotten wealth, acquiring assets of high values and keeping bank accounts with huge deposits… Is this acquisition sustained and duly supported by his income as a public official? “
The above is Article 2 of the impeachment against CJ Corona. It is arguably the weightiest of the eight charges and the one the public can most relate to. The prosecution chose to lead with it, hoping it will provide the moral underpinning and momentum for the other charges.
The Defense claims:
- 1.The CJ complied with the law when he filed his SALNs with the clerk of court.
- 2.The sub-charges 2.1-2.4 are conjectural and speculative.
- 3.The Prosecution’s “suspicion” of ill-gotten wealth has no basis.
- 4.The allegation of ill-gotten wealth is not a principal charge and therefore inadmissible.
The Prosecution argues:
- 1.The CJ did not “publicly” disclose his SALN. It took a sub-poena (and the prompting of Sen. Drilon) to produce it.
- 2. The Constitution requires public officials to “correctly” disclose their financial standing, not to file any piece of paper. The CJ’s SALNs do not do this.
- 3. Mr. and Mrs. Corona are the owners of substantial properties which is incongruous with their reported income. Combined with his failure to properly disclose his net worth, this is a presumption of ill-gotten wealth.
What is the standard for “correct” financial disclosure? Do the CJ’s SALNs meet this bar?
As an accounting document, a SALN should satisfy “generally accepted accounting principles” (GAAP), the industry standard for financial disclosure. GAAP requires:
1.Transparency- Assets and liabilities must have a basis for recording. It cannot be whimsical. In the case of real estate one can use acquisition cost, market value or zonal valuation. The following are the properties reportedly declared by Corona as of 2010:
Declared Acquisition Cost Difference
- La Vista, Q.C. P3.0MM P16.0MM P13.0MM
- Bellagio, Taguig P6.8MM P14.5MM P 7.7MM
- The Ridge, Taguig P2.3MM P 9.0MM P 6.7MM
- Burgundy, Q.C. P0.9MM P 2.5MM P 1.6MM
- The Columns, Makati P 1.2MM P 3.5MM P 2.3MM
- Total P14.2MM P45.5MM P31.3MM
The SALN does not apparently provide the basis for the declared property valuations nor why they significantly vary from his acquisition cost.
2. Comprehensiveness- A SALN must reflect all the assets and liabilities of the declarer.The Prosecution claims the CJ owns more than the 5 properties listed above. His two daughters reportedly purchased multi-million peso properties without the necessary income. If their father “lent” them the money to do so, the loans would have had to be recorded as an asset in his SALN. Otherwise they may be considered a “gift” subject to gift tax.
3.Consistency- The assets must be consistently valued year after year or an explanation is required. The media reports at least one property was unexplainably booked at a different value between one year and another.
4.Continuity- One year’s SALN must logically follow from the previous. Any change in net worth must result from a profit or loss in the year or from an adjustment in the value assets.
2006 2007 2008 2009 2010
- Net worth(MM) P9.6 P11.1 P12.6 P14.6 P22.9
- ITR Income(P000) P465 P488 P604 P621 P657
- Wife’s income(P000) P233 P400 P220 P318 P240
Based on the above, the Corona’s net worth and income in any one year do not match.
Conclusion: The Prosecution could argue the CJ’s SALNs are neither comprehensive, transparent, consistent nor continuous; and thus do not constitute proper financial disclosure as required by the Constitution.
Is this a presumption of ill-gotten wealth?
Amassing properties of (at least) P45.5MM on a net worth of P22.9MM and joint annual income (before tax) of around P900,000; could use an explanation.
Sen. Enrile has disallowed evidence related to the alleged ill-gotten wealth e.g. suspected “huge” bank deposits; but will allow presentation of properties not declared in the CJ’s SALN. It is unclear why undeclared bank deposits should differ from undeclared real estate. Without the money trail, the Prosecution could be hard pressed to prove its allegations.
Will this be the repetition of the Erap “second envelope” (reportedly containing his bank accounts), information which was disallowed by the court? This led to the Prosecution’s walk-out and People Power II.
Hopefully it does not get down to this.