By Limuel S. Celebria
At first I couldn’t believe it. Luis Miguel Cacho, president of Iloilo City’s erstwhile power distributor, Panay Electric Company, Inc. (PECO), owns a BMW? Amazing! Incredible!
The Luis Miguel I knew way back in the 90s wouldn’t even dare indulge in such luxury. The Luis Miguel I knew was a tighfist, not a spendthrift. He would even tell his players (PECO had a formidable basketball team back then) that he ate simple food like dried fish (tabagak) for breakfast. Tales of his miserly ways coming from his players – who are also PECO employes – have passed into legend. But let’s not indulge in this.
Last week’s issue of this paper narrates how Luis Miguel came to own a high-end, luxury vehicle. (Pls read https://dailyguardian.com.ph/consumers-call-for-probe-on-peco-over-bmw-car).
For those reading this on print, let me quote at length the pertinent sections of the July 31, 2020 article under the heading, Consumers call for probe on PECO over BMW car:
“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.
“Based on Land Transportation Office records, PECO sold the BMW sedan to Luis Miguel Cacho on May 22, 2019.
There we have it. Daily Guardian (DG) tried to get PECO’s side but, as of this writing, there had been no response. I hope they do come up with a statement on the issue as the article reinforces the prevalent view that PECO ‘s distribution system eventually went into disrepair over the years because the Cacho family which ran the show were quite stingy when it comes to spending for improvement or upgrading of facilities.
But if there is an LTO record of the sale of the BMW from PECO to Luis Miguel, how is PECO’s original acquisition of the car listed? Again, I quote the DG article: “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.”
“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 hardware,” according to a source familiar with the transaction. (The source here, which DG did not identify, is a former top management employee of PECO.)
Imagine, a budget intended for service vehicles being used to purchase a luxury car that is more into personal use. Is the lack of service vehicles also one reason why PECO took an eternity to respond to complaints of outages and other problems from concessionaires?
Another thing, it is usual practice in the power industry that Capital Expenditures – especially those used to improve the distribution system — are tucked into the computation of power rates charged to consumers. This comes with the approval of the Energy Regulatory Commission. Since the budget used to spend for the vehicle is classified “(u)nder PECO’s capital expenditure (CAPEX) for October 2011 to September 2015, which was approved by the Energy Regulatory Commission (ERC),” it is most likely covered in the power rate adjustment during the period in question or in succeeding years. Technically, therefore, the BMW is owned by PECO’s consumers since they paid for it.
The DG news article, citing a law professor who also requested anonymity, further said: “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…?
Although PECO is already history when it comes to the distribution of electricity in Iloilo City after its franchise expired and was granted to more, I really hope PECO, or Luis Miguel himself can issue a rejoinder or clarification that will put this issue to rest.
