. In our vernacular, it’s anyare? ){kind=link}
IN SPANISH, THE term que paso is asked to determine someone’s transformation (normally from fame to infamy). In our vernacular, it’s anyare?
This question just sums up the surprising transformation of Jose Arnulfo “Wick” Veloso, president and general manaager of the Government Service Insurance System (GSIS) from his golden days– when he held the distinction of being the first Filipino CEO of HSBC Philippines, his 30 years banking experience and steering several companies of the Lucio Tan Group as director, especially heading the former state bank beginning 2018 until July 2022 (the first of appointees by President Marcos) to run the GSIS.
At GSIS, though, his sterling reputation as a banker/CEO seemed to have been thrown away when he ventured into very risky, gambling ventures that included the highly-unknown but legally-created Maharlika wealth fund which caused huge outcry from its members and the public at large, then the Altenergy of former Energy Secretary Vince Perez (for which the Ombudsman meted him and other GSIS officials with suspension without pay for at least six months), investing in private companies (probably old clients) like Figaro and now the P1- billion investment in DigiPlus Interactive, a diversified gaming company and casinos, which is being grilled by neophyte Sen. Erwin Tulfo.
PNB, under Veloso, solidified its sustainability vision and roadmap, focusing on sustainable financing and profitability. Two years after the pandemic broke out, PNB posted 57 percent year-on-year growth in its net income for the first quarter of 2022 – a good indicator that the profit-making potential of PNB’s businesses continues to improve as the overall economy improves. Among Philippine banks, PNB is currently at No. 5 in terms of assets, with consolidated resources at Php1.1 trillion as of end-March 2022. The Bank also maintained its position as the Philippine bank with the largest global footprint, serving the financial needs of Filipinos abroad.
‘GSIS has already suffered a ₱251.37-million valuation loss on these equity bets and the COA has since ordered GSIS to craft a recovery plan to contain the damage and avoid further bleeding.’
MUKHANG MAY KUMITA!
Sen. Erwin, who is investigating GSIS investment in DigiPlus– sans board approval, was quick in declaring “mukhang may kumita” and wants Veloso to be charged,which could involve kickbacks, a criminal offense, Bilyonaryo said.
“Ako din po ay nagagalit at naiinis dahil ito po ay pinagpaguran ng mga empleyado ng pamahalaan. Dugo at pawis ang pinuhunan po nila dito para pagdating po ng panahon ng kanilang pagre-retiro, may mahuhugot ang mga empleyado,” Tulfo said in speech.
He expressed full support for Sen. Risa Hontiveros’ exposé on GSIS transactions, calling Veloso’s investment decisions questionable and unacceptable.
“Kaisa niyo po ako, Senadora Risa, hinggil po dito at nais ko po talagang maimbestigahan ito. At kung may pagkakataon po, maghahain po ako ng panukalang batas… na kailangan imbistigahan po ito at makasuhan po si Ginoong Veloso,” he said.
DIGIPLUS SHARES
Bilyonaryo reported that sank over ₱1 billion into DigiPlus Interactive (PLUS) shares—right around its peak of ₱65.30. The said shares were offloaded by a playboy billionaire in the middle of a messy divorce, it added.
Weeks later, PLUS—once tipped to join the Philippine Stock Exchange Index—plunged to as low as ₱13.68 on July 18, as lawmakers ramped up calls to ban online gambling. The crash has triggered a storm of criticism over GSIS’s timing, lack of due diligence, and exposure to high-risk bets.
Now, the pensions of government employees are staring at steep paper losses. The scandal adds to a string of controversial investments linked to Veloso, who is already under investigation by the Ombudsman.
A whistleblower complaint flagged GSIS’s ₱1.44 billion investment in Alternergy—a firm associated with former Energy Secretary Vince Perez—as another questionable deal.
In 2023 alone, GSIS poured ₱2.308 billion into three publicly listed firms.
The Commission on Audit (COA) flagged the transactions for targeting companies with no profit history from 2019 to 2022 and no dividend payouts.
COA warned that the investments could undermine the actuarial solvency of the pension fund and place members’ savings at risk.
TO AVOID FURTHER BLEEDING
GSIS has already suffered a ₱251.37-million valuation loss on these equity bets and the COA has since ordered GSIS to craft a recovery plan to contain the damage and avoid further bleeding.
Tulfo said he would ask the Senate Committee on Games and Amusement to lead the probe into what he described as reckless and suspicious use of public pension funds.
“Ito po ay aking paiimbestigahan kung may kumita. Mukhang may kumita po rito, mayroon pong commission o kickback at hindi po ito karapat-dapat at katanggap-tanggap,” Tulfo said.
Bilyonaryo was the first to report GSIS purchase of DigiPlus shares whose value dropped by as much as 80 percent a few weeks later.
ALTENERGY PROBE
Veloso and six other officials have been slapped with a six-month preventive suspension by the Office of the Ombudsman over GSIS’s ₱1.44-billion investment in Alternergy Holdings Corp., a renewable energy firm owned by former Energy Secretary Vince Perez, who later claimed they have repaid P100 million.
The Ombudsman said the deal, which allegedly bypassed board approval and key internal controls, “breached” the 2022 GSIS Investment Policy Guidelines.
Along with Veloso, suspended were: Michael Praxedes, Jason Teng, Aaron Samuel Chan, Mary Abigail Cruz-Francisco, Jaime Leon Warren, and Alfredo Pablo.
ANOTHER RISKY DEAL
In April 2024, Bilyonaryo reported a “risk, illiquid, potential for capital wipeout” P5.7-billion investment deal in Neuberger Berman Credit Opportunities Fund (NBCOF) that Veloso was about to plunge in but was stopped by the staunch opposition by Merceditas Gutierrez, former Ombudsman.
NBCOF used to be owned by Lehman Brothers, the fourth largest investment bank in the US with 25,000 employees worldwide, which filed for bankruptcy in 2008.
Veloso’s management team (through his righthand man Praxedes presented the investment plan) was unable to answer queries and present documents for their planned $100 million investment into NBCOF, which was turned down by the GSIS board of trustees, particularly Gutierrez.
His team had a follow-up meeting where they continued the presentation without addressing the concerns raised by Gutierrez on the profile of the entities involved, anticipated rate of returns, adherence to foreign and domestic laws, and the terms and conditions of the placement.
It was Gutierrez that found the answers to all her questions when her staff stumbled upon the private placement memorandum (PPM) on the table of one of Veloso’s henchmen.
The PPM highlighted that investments in NBCOF II carry substantial risks, as the fund is designed for sophisticated investors with the financial capacity and risk tolerance to handle high-risk ventures.
NBCOF investors should be prepared for prolonged risks without guaranteed capital returns, liquidity assurance, and the potential for complete loss of investment.
VELOSO’S RISKY PLAN
The Office of the Government Corporate Counsel weighed in on the deliberations by reminding the Board that it must explicitly approve GSIS’ waiver of immunity from liability, suits, and enforcement as required under the NBCOF II subscription agreement.
However, the OGCC warned the Board to exercise exceptional care in fulfilling its fiduciary duty. Legal actions against GSIS, where it could have claimed legal immunity, might spell trouble for the fund’s liquidity, security, and actuarial solvency.
This is why the OGCC said GSIS management should engage foreign legal experts to understand the applicable foreign laws governing the transaction before committing the pensioners’ hard-earned money into NBCOF II.
When Gutierrez intensified her opposition to Veloso’s risky plan of investing GSIS money into the New York-based fund manager, Veloso abandoned the planned investment. NBCOF II was just one of the questionable investments that Veloso had aggressively pushed for approval in the GSIS board, Bilyonaryo said.
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