SPECIAL REPORT: Where’s the money, PIDCI? (2nd in a series)

By Marivir R. Montebon & Cristina DC Pastor

Despite its accountability and transparency issues, PIDCI has continued to make it appear to potential sponsors who advertise in the souvenir program that their donations would be tax-exempt. In May 2018, a month before the 120th Philippine Independence Day celebration, its advertising form carried a note that said: “All donations are tax-deductible to the extent provided by U.S. law.”

A check with the Internal Revenue Service website found that PIDCI is no longer tax-exempt as of February 15, 2016 for failure to file its Form 990 return or notice for three consecutive years, starting in 2013.

There is a gap between narratives of people involved in the fundraising activities and PIDCI’s very own unaudited financial reports. Mrs. Kalayaan 2015 Rosita Mejia Richman, for instance, revealed that she personally raised $54,000 but in PIDCI’s 2015 report, Mrs. Kalayaan reported only $3,590 in gross income.

A dismal state of finances and reporting?
From its unaudited financial reports, PIDCI revealed that it spent more than what it earned, at least for 2014 and 2015.

Based on the narratives of those who have contributed to its finances, it has no system of recording and control of inflow and outflow of enormous incomes.

The general ledgers of PIDCI for the period 2013, 2014, and 2015 show PIDCI’s net income for 2013 at $68,384.81; for 2014, it suffered a loss of $28,534.29; and for 2015, another loss of $18,438.70. These unaudited documents were obtained from financial statements submitted to petitioners United Mindoro International and the Philippine Community Center Services for the Aging on orders of the Supreme Court of the State of New York in January 2018.

Summary of Income and Expenses
Year Income Expenses Net/Loss
2013 363,655.75 295,270.94 68,384.81
2014 388,911.62 417,445.91 (28,534.29)
2015 287,870.58 306,309.28 (18,438.70)

The years 2013 to 2015 was the time when PIDCI failed to file its Form 990 (the return for an organization that is exempt from income tax) with the IRS, thus resulting in the revocation of its 501 (C) (3) status. This was under the presidency of Fe Martinez, who led PIDCI for four consecutive terms.

How does PIDCI earn money?
In order to realize the annual Independence Day parade on Madison Avenue, PIDCI undertakes several programs to raise funds. The Grand Marshals are key to the raising of such funds. They are well-positioned and well-respected members of the Filipino community and can use their influence to mobilize financial resources for the parade. In 2013, the Grand Marshal was Dr. Dolly Rivera, followed by Drs. Emilio and Felicisima Quines in 2014, and Atty. Reuben Seguritan in 2015.

The sources of income of PIDCI include its journal or Souvenir Program, the Mrs. Kalayaan fundraiser, Diwa ng Kalayaan fundraiser, ConGen Night fundraiser, corporate sponsors, and the Cultural Festival which earns from booth rentals of food vendors, fees from parade contingents and floats on the day of the parade itself.

According to a former PIDCI director, only the Sponsorship Committee receives donations. During the years in question, the committee was composed of then treasurer Violeta McGough and president Fe Martinez. The director, who spoke on condition that he remain unnamed, said no one would have found out how monies came in and out of the coffers, because all the directors were busy with the tedious tasks they were assigned in preparation for the parade and other festivities. “We were all focused on our committees. Receiving of funds, which were mostly in cash, and disbursements were done by the Sponsorship Committee,” he revealed.

Suspicious 2013-2015 General Ledgers
Accounting experts sought for this report opined that general ledgers are not reliable sources of finance reports because they can be generated in the computers, through QuickBooks, for instance. General ledgers have to be substantiated by actual receipts and vouchers to make them reliable. Even then, receipts and vouchers can also be fabricated in order to create a semblance of order which is quite a common practice.

Additionally, each of PIDCI’s fundraising program does not have a systematic recording of income and expenses. Not all incoming monies are receipted and therefore it is uncertain whether these were recorded — according to the program they belong — and deposited in the bank.

A case in point is the Mrs. Kalayaan fundraiser. Candidates mobilize funds from the support of food vendors and corporate sponsors during the Cultural Parade and Festival. It also generates income for the journal through greeting advertisements. However, for the record, there is no cross-referencing what fundraising programs did the Mrs. Kalayaan candidates place the money they have gathered.

For instance, Mrs. Kalayaan titleholder 2014 Joji Rafael said she raised more than $40,000, through friends and from her own pocket, but was not issued receipts. This amount was gathered through the Kalayaan Ball where she invited her friends and family, greeting ads on the Souvenir program, and support from food vendors who vouched for her candidacy.

Mrs. Kalayaan FilAm 2014 Ruth Sityar echoed Rafael. She said she raised $36,400 for PIDCI and got no receipt.

Both Sityar and Rafael said, in two separate interviews, they were not issued receipts for these contributions. They also revealed that during the final counting and proclamation of Mrs. Kalayaan in 2014, the committee counted individual candidates’ cash and checks contributions in a public setting!

But after each counting, there had been no public announcement made as to how much each candidate raised, and there was no overall reporting of the total contributions made by the nine titlists. Hence, no one really knows, not even the fundraising ladies, how much total monies were mobilized during the final counting, except the Mrs. Kalayaan committee members in 2014.

Rafael and Sityar alone would have a combined contribution of $76,400 for PIDCI in 2014. But from its annual unaudited report in 2014, the entire income from Mrs. Kalayaan was recorded at $48,666.

How about the income from the seven other Mrs. Kalayaan titlists, aside from Rafael and Sityar? Where did it go? How were they recorded? The General Ledger for 2014 does not reflect it.

This report sought comments from current PIDCI President Antero Martinez and lawyer Manuel Quintal but got no response as of publication time.

Next: Staggering pay-to-cash disbursements

© The FilAm 2018