Several groups are calling for an investigation on a luxury car allegedly acquired by Panay Electric Co. (PECO) and eventually sold to its president after the expiration of its franchise.
The Western Visayas Transport Cooperative (WVTC) and the Iloilo City Loop Alliance of Jeepney Operators and Drivers Association (ICLAJODA) both called on authorities to investigate the issue “because if true, it is a clear case of a deceitful transaction which involves the money of the electric consumers.”
“Well, they have to justify to the people so it must be investigated by the authorities. They have to prove that they have not wasted consumers’ money here or else they have to answer for it,” according to Halley Alcarde, general manager of WVTC.
ICLAJODA president Raymundo Parcon questioned the timing of the sale emphasizing “why in the world that while PECO is embedded in legal issues regarding the continuity of its operations that it will time the sale of the company-owned luxury car to its own president. Just mind-boggling isn’t it? And one more thing, is PECO allowed by the ERC to own a luxury car?”
Daily Guardian reached out to PECO for comment, but they have yet to issue a statement as of this writing.
CAR IN QUESTION
Sometime in 2015, PECO bought a BMW 520d sedan from Asian Carmaker Corporation. This class of BMW sedan costs around P5 million.
Under PECO’s capital expenditure (CAPEX) for October 2011 to September 2015, which was approved by the Energy Regulatory Commission (ERC), the company proposed to buy transportation equipment for five years starting in 2011 with P2,133,851 allocation, 2012 with P2,231,446, 2013 with P2,337,988, 2014 with P2,447,289, and in 2015 with P2,560,476.
The funds were supposed to be used for the purchase of five utility vehicles for PECO officials, but it did not materialize after Luis Miguel Cacho, PECO’s President and Chief Executive Officer, allegedly decided to buy a BMW.
The cost of the sedan was equivalent to the price of the five utility vehicles meant for official use of other PECO executives.
“But since he cannot justify the purchase of BMW using PECO’s money and to hide it from its Board of Directors and to the ERC which will surely disallow this expenditure, Cacho recorded the expenditure in PECO’s book as purchase of distribution lines and hardwares,” according to a source familiar with the transaction.
Interestingly, PECO declared in its books an expenditure of almost P5 million for distribution lines and hardware in the same year that the BMW was purchased.
VIOLATION?
Some PECO officials during that time clamored that the BMW purchase may have violated the ERC guidelines.
On PECO’s capital expenditures forecasts, which was approved by the ERC on its final determination covering the period of 2011 to 2015, it clearly said that “the forecasts are to be based on the economically efficient capital expenditure requirements to meet forecast demand over the second regulatory period.”
“Buying a BMW midsize sedan for personal use by its president cannot be considered economically efficient, but rather, an abusive use of customers’ money who will eventually pay for it through distribution rates of PECO,” a former PECO official claimed.
On Feb. 14, 2019, President Duterte signed Republic Act 11212 granting MORE Power the franchise to operate the distribution system in Iloilo City. The same law which also authorized MORE Power to expropriate the distribution assets of PECO.
Based on Land Transportation Office records, PECO sold the BMW sedan to Luis Miguel Cacho on May 22, 2019.
“Since Cacho was the president and CEO during that period, he just practically sold the BMW to himself, knowing fully well that the BMW is practically owned by the customers as it was charged to the customers through rates. Isn’t that a clear case of a fraudulent sale which qualifies to estafa which even a law student can confirm to be criminal in nature?” according to a law professor who requested anonymity.
