Perfecto Yasay having his mugshot taken. Photo: Facebook
Source:
https://scmp.com/week-asia/politics/article/3024053/dutertes-former-top-diplomat-who-played-key-role-shaping-policy Politics
Duterte’s ex-top diplomat who smoothed over Philippine-China ties arrested for bank fraud
- Perfecto Yasay Jnr, Duterte’s college friend, was appointed as foreign secretary despite being implicated in criminal charges filed by the central bank in 2011
- During his eight-month stint, he helped to smooth ties between Beijing and Manila after the latter won the South China Sea arbitration case against China in 2016
Perfecto Yasay pictured in 2015 with his old college roommate Rodrigo Duterte. Photo: Facebook
Perfecto Yasay, Jnr, 72, President Rodrigo Duterte’s former college room mate whom he appointed as his first foreign secretary, was arrested in the Philippines on Wednesday in connection with a long-running bank fraud case.
He was appointed by Duterte despite being implicated in criminal charges filed before the Department of Justice by the Philippine Central Bank (BSP) in 2011.
Yasay played a key role “in crafting and articulating foreign policy”, a well-placed government source who spoke on condition of anonymity told the Post on Friday.
When Manila unexpectedly won the South China Sea arbitration case against Beijing before the Permanent Court of Arbitration in July 2016, it was Yasay who helped lower the temperature between both nations considerably and prevented a furious China backlash.
“[Yasay] was the one who explained the initial reaction to the arbitral award,” the source said, referring to the low-key approach taken by the administration on the landmark legal victory. “The China policy was crafted by a team of advisers that included Yasay, and he played a major role in explaining and implementing it.”
The source described Yasay as “articulate, eloquent and amiable as a foreign secretary” and “loyal to Duterte, since their friendship dated back to their youthful years, and he tried his best, despite his limitations, to develop and explain the strategic ideas that constituted the Duterte administration’s foreign policy”.
Yasay was not a fan of Beijing. In a 2013 Twitter post, he wrote: “China appears as the mighty predator in the food chain that pries on weaker nations to satisfy its insatiable greed for power and resources.”
But when he became foreign secretary, he posted a conciliatory note on Facebook: “Foreign relations is not about burning bridges. It is about building bridges.”
Yasay sparked controversy when he shared a photo of himself on Facebook posing with a mini assault rifle and saying he supported Duterte’s “all-out war against illegal drugs”.
Yasay also criticised the United States for treating Filipinos as “little brown brothers” and said Duterte is “trying to liberate us [from a] shackling dependency” on the US, which he blamed for failing to stop China from grabbing reefs in the South China Sea claimed by the Philippines, its former colony.
Yasay’s stint as Duterte’s top diplomat was cut short in March 2017 after only eight months, when the 15-member commission on appointments of Congress unanimously rejected his appointment over questions of his citizenship.
Yasay had previously told the commission he was never a US citizen. When the news website Rappler reported he had a US passport in 2006, Yasay admitted to taking his oath as an American citizen in 1986 and having a US passport in 2006.
He insisted, though, that his US citizenship was “voided” by his return to Manila in 1987. However, the US Internal Revenue Service only recognised his loss of citizenship in a February 2017 notice posted on its website.
It was only after Yasay left the Duterte cabinet in March 2017 when the Philippine banking regulator pursued the criminal charges it had earlier filed in 2011 against Yasay and nine others because they “repeatedly violated” banking laws.
The BSP, in a 2011 news release posted on its website, said that directors and senior officers of the Banco Filipino Savings and Mortgages Bank “approved an excessive number of weak and self-serving loans to its directors, officers, stockholders and related interests (DOSRI loans), equivalent to 2.192 billion pesos or 53.5 per cent of total loans”.
Yasay protested after his arrest on Wednesday that he was not yet a director when the loans were issued.
Yasay was included though, according to the BSP, when during his stint as board director: “Banco Filipino manipulated, falsified, and window-dressed its accounting records to conceal its true financial conditions to the great prejudice of its depositors, creditors, investors and stockholders.”
The bank, which had 177,652 depositors, half of whom had deposits of 5,000 pesos (US$96) and below, was closed by the BSP in 2011 to stop the bleeding.
Yasay vowed to fight this “abuse of process and travesty of justice”. He was rushed to the hospital hours after his police mugshot was taken due to high blood pressure.
Yasay posted bail on Friday, and said on Facebook: “Now the fight for justice and to prove my innocence begins.”
Duterte has not reacted to the arrest of his former room mate.