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Press Release



Ombudsman charges ex-Cagayan vice-gov, bank exec with graft and estafa
03 February 2017


The Office of the Ombudsman has found probable cause to charge former Vice-Governor Leonides Fausto of Cagayan and two others for Estafa and violation of Section 3(e) of the Anti-Graft and Corrupt Practices Act. Also facing charges are Eulalie Taguiam-Fausto, the Assistant Vice-President/Branch Head of the Tuguegarao City branch of Land Bank of the Philippines and Ricardo Cabacungan, Jr., an executive assistant in the office of the Vice-Governor.  The three are facing charges for their involvement in the multi-million peso scam involving the disbursement of the 2006-2007 Internal Revenue Allotment (IRA) of several barangays in the province. 

 Based on the records, investigation found that respondents committed irregularities in 206 check disbursements totaling P6,606,324.90.  The illegal disbursements were made due to the vice-governor’s representation that “he can facilitate the immediate release of the barangay’s IRA if each and every barangay will issue blank checks in his favor.”  Ombudsman Conchita Carpio Morales stated that “such representation constituted the real and moving cause for the barangay officials to issue blank checks and induce a majority of the barangay officials of the five municipalities to issue blank checks.”

 In an approved Joint Resolution, the Ombudsman explained that “the scheme to divest the barangays of their IRA could not be effected in full if it were not for (1) Cabacungan who accomplished the necessary details of almost all of the blank checks issued including their supposed supporting documents; and (2) Taguiam-Fausto who identified that it was the payees of questioned checks who affixed their signatures at the back portions of the checks and received the amounts.”

 “All in all, their overt acts essentially contributed in the execution in the grand scheme of divesting the barangays of their funds,” added Ombudsman Morales.

 Under Section 3(e) of R.A. No. 3019, public officials are prohibited from causing any undue injury to any party, including the Government, or giving any private party any unwarranted benefits, advantage or preference in the discharge of his official administrative or judicial functions through manifest partiality, evident bad faith or gross inexcusable negligence. On the other hand, Estafa under Article 315 (Paragraph 3 a) of the Revised Penal Code is committed by defrauding another person by inducing another, by means of deceit, to sign any document.

 Meantime, in the related administrative case, the Ombudsman found the three respondents liable for Grave Misconduct and Serious Dishonesty to which they were meted the penalty of dismissal from service, including the accessory penalties of cancellation of civil service eligibility, forfeiture of retirement benefits, perpetual disqualification from holding public office, and bar from taking civil service examinations.

 In the event that the dismissal could no longer be enforced because of separation from service, the same shall be converted into a fine equivalent to the respondent’s one-year salary. ###