by Lito Banayo
from MALAYA
There are certain government institutions we ought to repose full trust upon. One is the Supreme Court, as the trustee of our justice system. In a recent shoot-the-breeze joust with lawyer and Senator Francis Escudero, I questioned the total subservience of lawyers to the highest tribunal. Why must the Court be right even when it is wrong, I asked? His quick retort was — “because otherwise we will have anarchy”. Well said. But then, are the fifteen appointed justices of the Court aware at all times and without mental reservation whatsoever that they carry such a formidable burden upon their individual and collective conscience? Or do they take their lawful authority as final arbiter of the law as lightly as Gloria Macapagal Arroyo says “I am sorry”?
Another institution the trust upon which is taken as matter of course is the Bangko Sentral. It is after all, the bank of all banks, upon which we entrust our savings, our financial assets. It is the issuer of legal tender. In fine, it is the fiduciary of our monetary system. But is the Bank always acting in our best interests? Once our Congress had to save it from financial collapse, saddled with the collective onus of a banking system used by the politically powerful to feather their illegitimate nests. Re-capitalized, what was then the Central Bank metamorphosed into the Bangko Sentral ng Pilipinas, re-energized by massive infusions from the “kaban ng bayan”, and we the people could do nothing but approve in silence. Congress legislated much, much higher salaries and emoluments to the “professional” managers and even the rank-and-file who populate the fortress-like block upon Roxas Boulevard and A, Mabini so that they shall be less susceptible to the temptations of that scourge called corruption. Congress decreed that they shall be independent of the president even after his or her appointment, just as much as the Federal Reserve Board conducts monetary policy in the United States.
Well, let me tell you about the Central Bank of Nigeria, and if you have been following this column and two articles on the outsourced printing of our banknotes last month, you will likely appreciate this writer’s concern.
On October 5 last year, the former governor of the Central Bank of Nigeria, Charles Chukwuma Soludo, was named as one of the CBN officials who received bribes allegedly paid officials of that country by the Australian printing company, Global Securency. Soludo denied the bribery allegations, but it has emerged that the central bank under his leadership did award the contract for the printing of polymer notes because the CBN controlled 77 per cent of the Nigerian Security Printing and Minting Company Ltd. Plc. which officially awarded the buy orders in 2006.
Five companies bid for the printing of the re-designed naira banknotes: Global Securency of Australia; Gieesecke and Devrient of Germany; De La Rue of the UK; FC Oberthur of France and the Nigerian Security Printing and Minting Company. The bid was opened on March 27, 2006 and concluded April 4, 2006. The contract was awarded on May 2, 2006.
The documentary trail that has since been uncovered shows that Global Securency made a series of multi-million dollar payments into offshore bank accounts of two British-based businessmen linked to the currency printing deal. Early in 2009, the Australian Federal Police Authority sent a high level confidential memo to the presidency through the national security adviser detailing bribery investigations centering on a series of multi-million dollar payments to the two British-based businessmen which were later transferred onward to Nigerian government officials. Australian Federal Police had been investigating Securency for possible breaches of Australia’s criminal code which outlaws kickbacks to officials of foreign countries.
Prominent among the recipients of said bribe monies is the former CBN governor, Charles Chukwuma Soludo, other senior officials of the Nigerian finance ministry, and even it’s former president. Soludo reportedly demanded and received bribes from the firm before steering contracts through the CBN-controlled Nigerian Mint to mass-produce polymer currency. (Polymer banknotes, like the Thai baht, is a new innovation, where thin plastic or polymer is substituted for security paper because it is supposed to last longer given torrid and tropical temperatures and humidity levels).
The new polymer naira banknotes were launched in the Nigerian capital, Abuja, on September 30 last year by Pres. Umaru Yar’Adua, to coincide with Nigeria’s 49th Independence Day celebration. Yar’Adua is currently ill, and his vice-president, a man named Goodluck Jonathan, took over in February 2010.
The Australian police has uncovered evidence showing that as much as 10 million dollars were wired to accounts, including some in secretive tax havens, by Securency. The current CBN governor, Mallam Sanusi Lamido Sanusi has promised that the federal government of Nigeria will investigate CBN officials past and present who may have received the alleged pay-off.
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In the previous articles in this space, we have asked the Bangko Sentral to explain why it has resorted to outsourcing the printing of our banknotes for the past seven years when we have a Mint at East Avenue, the machinery and facilities of which could be replaced and upgraded at a fraction of the cost of outsourcing printed money. With a population of 93 million where paper currency gets easily soiled and worn-out, the annual number of banknotes imported over so many years averages some 700 to 900 million pieces a year. The 1976-established security printing facility at East Avenue is partially idled, its administrative costs running high despite less than optimal utilization.
I hate to think the Nigerian scandal has parallel in this benighted country. The Bangko Sentral governor is a career official known for his probity and professionalism. But our Bank is shrouded with mysteries, one of which is the strange acceptance of spurious titles as payment for emergency loans extended to a family-owned bank when it was haemorrhaging in 1998 due to DOSRI accommodations turned sour. Surely these could not have happened without red flags being raised by middle management, yet the Bank strangely closed its eyes, and remains as mysteriously silent now as it was then. While the present leadership may have been clueless about the misjudgement of predecessors, is it now maintaining a Sphinx-like stance because the culprit may yet become president of the land?
Recently, a deputy governor, Diwa Gunigundo, announced that the Bank will go ahead with the outsourced printing of newly-designed banknotes, which it hopes to bring out in circulation before the holiday season this year. Why the rush? Is there a desire on the part of the Arroyo regime to put its indelible stamp on our legal tender, as it once shamelessly issued a 200-peso note to celebrate its illegitimate power grab from a duly-elected president of the land? Or, has the regime used the Bank to launder ill-gotten wealth? Or perhaps, as no institution and no project is conceivably freed from corruption by the present regime, the “Arrovos” along with their imbedded conspirators in the Bank are also into the same racket the Nigerians have embarked upon?
I hate to cast aspersions, but the amount of outsourced banknotes, and the rush to come up with new designs, unmindful of the fact that there will be a new president by June 30 this year, seems fishy and smells similarly. Juxtapose this bullheadedness about issuing new legal tender with the cancellation of a tender for new printing machines announced last October 2009, and you cannot but wonder why the Bank is way too fond of mysteries.
In the well-chronicled book, Shadow of Doubt by Maritess Danguilan Vitug which I finally found time to finish reading during the Lenten holidays, she pierces the shroud that has enveloped the legal holy of holies that is the Supreme Court. “I did not idealize the Court as a perfect place. But I did not expect it, either, to be a place that is tolerant of men and women who take integrity lightly”, Vitug wrote.
During the same annual season of penitence, I found time to read what Klaus W. Bender in his 2006 book, Moneymakers (The Secret world of Banknote Printing) describes as the “obsession with secrecy” (characteristic of) banknote printing, which “involves the massive use – and often waste – of taxpayers’ money”.
We pause for a response from the Bangko Sentral.
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