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OCLP’s trickery; Ernst & Young’s ‘coup’

C.R.O.S.S.R.O.A.D.S

Jonathan De la Cruz

02/08/2009

OCLP, short for Ortigas & Co. Limited. Partnership is the multi billion-peso real estate holding company of the Ortigas family which is credited with the development of vast tracks of land in northeastern Metro Manila into the tony communities of Greenhills, Wack Wack and Valle Verde, among others, which rival that of the Ayalas’ Makati. Heretofore, this secretive family has let the Ayalas hug the headlines with their advocacies and fast paced developments.

There was that studied “hibernation” that may end soon with a bang which threatens to destabilize the group to the very core. OCLP stands accused of taking the government and the public to the showers by engineering the “settlement” of a non-dispute involving the much coveted 18-hectare sequestered property where the equally controversial Metrowalk complex is presently located.

OCLP’s trickery. OCLP has reportedly induced PCGG Chairman Camilo Sabio to enter into a “compromise settlement” of a claim it lodged over the property immediately after Edsa I. The OCLP claimed it sold the property in 1968 under duress to a suspected Marcos front called Maharlika Estate which was later taken over by one of the so-called Campos companies called Mid-Pasig Development. That claim was thrown out by then PCGG Chairman Ramon Diaz who said that the sale was valid and that OCLP was even paid a handsome sum way above the market value of the land at that time. Diaz even lectured OCLP not to repeat its claim that it was sold under duress because it will only expose the family’s unscrupulous ways. But now, for some reason (Sabio claims he is getting orders from Malacañang which his immediate boss, Justice Secretary Raul Gonzalez, who is not even aware), OCLP says it is about to or has already inked the compromise deal.

To emphasize its magnanimous offer, OCLP let it be known that it is only asking for 35 percent of the property and only on the “less valuable side” facing Julia Vargas Avenue. Wow!! What an offer. That side hosts almost all of the rented spaces, abuts the tony Valle Verde villages and is adjacent to the newly refreshed Ortigas Center. If that is less valuable, I don’t know what is? But that is not the point. OCLP does not have any claim on the entire property, period. It’s gratuitous advise that it sold the cogonal, abandoned property in 1968 four years before martial law and when President Marcos was just completing his first term simply does not wash. Then PCGG Chairman Diaz who is no Marcos lover saw that which is why he threw the OCLP claim into the wastebasket the moment it was filed.

PCGG’s complicity. And now PCGG’s Sabio has the gall to give in? What’s the big deal? Why are they even entertaining this offer at all? After throwing it out years back, then fighting tooth and nail over its ownership, having it titled and rented out to Metrowalk and other concessionaires for years now, Sabio and the PCGG are suddenly taken in by this self-serving OCLP claim? What kind of offer did OCLP put on the table to overturn years of PCGG resistance to any and all other compromises including direct offers to buy? Secretary Gonzalez and Malacañang should ask Sabio and the PCGG to submit all the papers on this deal before it blows up in their faces. The OCLP offer we got hold of, is so lopsided in its favor it should have been shredded outright. But Sabio has entertained it and has reportedly initialed it.

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The Ernst & Young coup. What we feared would happen when we first disclosed the brazen efforts of international auditing firm Ernst & Young (E & Y) has now happened. We are receiving conflicting reports that E & Y’s local surrogates led by SGV deputy managing partner, lawyer Cirilo “Vic” Noel have staged a “coup” against the current chief, David Balangue, and, of course, the very partnership itself. One report says the coup plotters succeeded in ousting Balangue and are now in control of the country’s oldest and biggest auditing firm. If true, then this will be another “Only in the Philippines” operations. Imagine, an auditing and accounting firm being headed by a lawyer not a CPA?

Another and, hopefully, the more recent one says only that “…SGV is under attack by forces linked to E & Y led by Cirilo Noel who organized a signature campaign last Feb. 3, 2009 to oust David Balangue, SGV chairman and managing partner. The pro-Ernst & Young group released various statements to partners and staff and even to a number of clients advising that Noel has assumed the top post. However, the coup failed and Balangue remains the Managing Partner continuing to resist the Ernst & Young takeover because of the potential violations of the 1987 Constitution, the Philippine Accountancy Act and the Anti-Dummy Law…”

Indeed, whatever will be the final outcome of this classic battle will definitely have repercussions way beyond the confines of SGV. For one, if the E & Y or Noel group succeeds, they will have nothing else to do except to justify all the violations underlying the “internal agreement” which they have entered or are entering into. If allowed to stay under whatever guise then the E & Y guys shall have patented another mode of changing the Constitution which should be instructive at this time when everybody is all heated up on the so-called deceptive Charter change initiative. That must be the reason why E & Y has chosen a lawyer, Noel, to head its auditing operations in the Philippines.

Second, If E & Y is now in control of SGV’s operations what happens to the partnership? Will it be dissolved? What are the terms of dissolution and what regulatory agency will take care of that? Who will the Philippine-based clients talk to if they need to be advised about their operations and the audit findings, if any? Will the buck stop with Noel or will it be passed all the way to E & Y global headquarters somewhere?