New NBN-ZTE witness flip-flops, denies kickback knowledge

March 11, 2008

Businessman Leo San Miguel, alleged member of the notorious “Greedy Group plus plus” in the controversial ZTE broadband deal, yesterday confirmed the involvement of former Commission on Elections (Comelec) Chairman Benjamin Abalos Sr., as well as a reported close friend of the First Family, Ruben Reyes, in the transaction of the botched contract.

But San Miguel tried to steer clear from getting himself deeper into the controversy passing the buck on the issue of alleged kickbacks and overpricing to the two as being in the know on these matters, yet he made several slips of the tongue corroborating earlier allegations during the entire time he stood as a witness in the ZTE probe of the Senate yesterday.

But the witness, billed as a “surprise” witness, was earlier seen as being highly evasive, claiming he did not have any conversation with a government official after he and opposition Sen. Panfilo Lacson cut off for their last meeting at 11 p.m. Monday. It was later found that he had spoken to a government official.

San Miguel, a research engineer for an electronics company who established Home Cable, admitted that the alleged conversations on purported “commissions” in the tainted $329-million ZTE contract was between Reyes and Abalos, but claimed he did not hear the conversations,

adding that he didn’t know of the involvement of Abalos but it was later established, through Senate President Pro Tempore Jinggoy Estrada, that he had traveled too many times together with Abalos to China.

But he said that while he talked about advances, he said: “I don’t know if I can call it (commissions) advances because this wasn’t part of my transaction with ZTE. I could not confirm such advances because my role was limited to technical issues,” he stressed under questioning by Lacson on his knowledge of the distribution of the $41 million cash advances that another witness, Dante Madriaga, previously claimed was intimated to him by San Miguel.

He said he was not trying to difficult and that he doesn’t have direct knowledge, |but logic states maybe there is (a commission). I just don’t know,” he said, adding that “I never heard him (Reyes) say that there’s an overpricing…he (Reyes) said ‘friend, there’s a little money to be made here,’…I think it means a decent pay for a decent work. On payoffs, I have no direct knowledge…It appears that he (Reyes) is the local guy who will do things for the local government. He arranges meetings for ZTE officials. It’s not safe for me to assume that he’s with Abalos,” he said in answering a question from Sen. Francis Escudero.

Rodolfo Noel Lozada and whistleblower, businessman Jose “Joey” de Venecia III, however, contradicted his testimony as both said that San Luis’ presence in most meetings with ZTE officials, including the incident in Wack-wack Golf and Country Club where First Gentleman Jose “Miguel” Arroyo told Joey to “back off” from the deal and another in Shengzen, China where Abalos purportedly demanded from the Chinese officials the $130 million in kickbacks.

San Miguel said he was not at the meeting, referring to the incident with Mr. Arroyo, adding that he is yet to personally meet the presidential spouse, much more President Arroyo during the entire time they were negotiating the ZTE project.

Cornered on this matter, San Miguel recalled the Wack-wack meeting when asked if he had already met Lozada previously where former National Economic Development Authority (Neda) chairman Romulo Neri was also in attendance, saying that the Senate’s star witness “at that time was a silent listener.”

“I remember Secretary Neri (telling us), for coordination, refer to him (Lozada),” San Miguel said.

He told Senate probers it was Reyes who contacted the China-based ZTE Corp. for the project and he got involved through police Gen. (ret.) Quirino dela Torre whom he described as a long-time business partner.

“The participation of Chairman Abalos in some meetings with ZTE, is there with Ruben Reyes. I can only assume that he is part of the Philippine Group (in the ZTE project) but I really don’t know what kind of relationship they have. When we say Philippine group, these are the people who are helping ZTE in one way or another…I know he’s been helping…on that (brokering) specific sense, I don’t know,” he insisted while being questioned by Estrada, in pursuing the matter as San Miguel proved evasive especially in implicating known Palace personalities.

But Estrada succeeded in having San Luis admit to several ZTE-related travels abroad, especially those in Hong Kong and China where Abalos was in attendance.

“In the testimony given by Joey de Venecia (III), you, First Gentleman and several other high-ranking officials of ZTE played golf in Shengzen,” asked Estrada.

He said he was not in that golf game.

San Miguel, at one point, admitted “encountering” Abalos in a hotel in Hong Kong in which the supposed entire delegation’s bill was even paid for by Dela Torre.

By his own admission, San Miguel practically corroborated some of the allegations made by De Venecia III such as the incident where Abalos allegedly demanded that part of the purported kickbacks be released by the ZTE.

He attested to another meeting in China on Dec. 26, 2006 where De Venecia III, Reyes, Abalos met upon the request of ZTE officials, validating his previous claims over an attempt to merge his company, Amsterdam Holdings Inc. (AHI) with the former Comelec chair’s group.

“To my understanding, there was the formula on how ZTE is able to involve De Venecia (III)) as far as ZTE is concerned. So I was requested to attend the meeting,” he said.

“This is the meeting where Abalos first introduced me to ZTE. Then, it was the time when he started asking for the commission,” De Venecia III said.

San Miguel was adamant in claiming that he did not hear of alleged talks on commissions in that said meeting saying that he and Dela Torre were asked to step out of the room, a matter that De Venecia III denied, stressing that the former heard everything.

Madriaga reiterated his previous testimony on being employed by the former as also a consultant to ZTE, presenting the document he submitted several weeks ago before the blue ribbon committee’s technical working group (TWG) on a supposed contract for undertaking work for the Chinese firm.

As San Miguel tried to discredit his claims, pointing out alleged forging of his signature in the said document and that he was not a supposed alter ego, Madriaga presented to Senate probers a copy of a supposed email from the former discussing purported kickbacks or what they dubbed as “tongpats” or “patong”, meaning padding in project cost.

Madriaga read out the email sent by San Miguel on July 22, 2006 which carried a table itemized cost of the project with the supposed corresponding padding reflected.

Lozada, for his part, also disputed San Miguel specifically on the latter’s pronouncements that his dealings with the group dealt mostly on technical aspects of the project and that he was kept in the dark, supposedly on the kickback issue.

“I do not think all of those matters (discussed in our meetings) are purely technical…I’m also a technical guy. We talk about everything else except technical,” Lozada said in debunking San Miguel’s statements that in meetings he attended with Abalos, the former Comelec chief would engage in technical matters.

San Miguel’s testimony surprised everyone including Lacson who convinced him to come out in the open and initially gave the impression that he would corroborate the allegations made by their previous witnesses.

He stressed that he did not approach anyone in the Senate, Lacson included, adding that their first meeting several weeks ago that led to three more meetings, the last of which was just hours before his appearance in the upper chamber, “was more accidental than anything else.”

“I’m more surprised than disappointed…I didn’t expect him to be that evasive. I thought he would not relay some (vital) information but not the way it turned out,” said Lacson an interview during the break in the hearing.

Lacson was told by a common friend that San Miguel apparently had a sudden change of heart as to what he would reveal to the Senate.

“When a common friend (called him and) asked him (in the middle of the proceedings) what happened…he said ‘wait, I’m under intense pressure,” Lacson said quoting San Miguel, adding that it was for this reason that they requested the latter to join them for lunch to prevent some interested parties from either calling him or a chance to exert further pressure on the witness during the break.

Lacson remained confident that despite the testimony given by San Miguel, this can be refuted as he was in receipt of some “materials” showing some of the alleged irregularities that attended the deal and he intends to share this information with his colleagues during a caucus and not during the proceedings as he do not intend to confront their guest.

The senator admitted that San Miguel has been “consistent” in making flip-flopping decisions as to whether to tell everything. “We have some common friends and they were texting me, they were as surprised as I am with his testimony,” he said.

Source: http://www.tribune.net.ph/headlines/20080312hed1.html

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