Authorities Service Insurance coverage System (GSIS) president and normal supervisor Jose Arnulfo “Wick” Veloso.
Authorities Service Insurance coverage System (GSIS) President and Basic Supervisor Jose Arnulfo “Wick” Veloso on Thursday defended the pension fund’s alleged dangerous funding in renewable vitality firm Alternergy, saying the P1.45-billion deal complied with all relevant guidelines and laws.
Veloso issued the assertion after being positioned below a six-month preventive suspension by the Ombudsman, which he mentioned was imposed with out contemplating the counteraffidavit he submitted in response to an nameless criticism.
The criticism additionally implicated six different GSIS officers and triggered a probe into the due diligence, threat publicity and the usage of pension funds within the controversial inventory funding.
The transaction was flagged earlier by the Fee on Audit (COA), saying that the GSIS invested a complete of P2.3 billion within the shares of three corporations that “haven’t any confirmed monitor document of profitability during the last three years.”
State auditors warned that the transactions—together with the take care of Alternergy—uncovered a “important quantity of members’ contributions to excessive threat” and will hurt the monetary well being and stability of the pension fund. As of March 2025, the GSIS has a complete of two.74 million members and pensioners. Its complete property quantity to P1.83 trillion.
‘Unverified criticism’
Veloso maintained that the take care of Alternergy “underwent rigorous analysis and endorsement by the GSIS funding workforce.”
“With out ready for my counteraffidavit, which was well timed filed, the Ombudsman determined to rely solely on the naked allegations contained within the nameless and unverified criticism in preventively suspending me and different hardworking officers of GSIS,” Veloso mentioned.
“Definitely, the skilled judgment of those specialists holds considerably larger credibility than the unverified assertions of an nameless supply,” he added.
Ombudsman Samuel Martires, in an order signed on July 11, suspended the GSIS officers with out pay to forestall any potential interference with the continued investigation. The probe facilities on administrative prices they face for grave misconduct, gross neglect of responsibility, and violation of cheap workplace guidelines and laws.
Apart from Veloso, the order covers Govt Vice Presidents Michael Praxedes and Jason Teng; Vice Presidents Aaron Samuel Chan and Mary Abigail Cruz-Francisco; officer Jaime Leon Warren and performing officer Alfredo Pablo.
Alleged violations
In accordance with the Ombudsman’s decision, an investigation launched in January revealed that the GSIS acquired 100 million perpetual most well-liked shares in Alternergy at P14.50 every, below a subscription settlement signed on Nov. 7, 2023. The overall transaction amounted to P1.45 billion.
The Ombudsman discovered that the deal violated the GSIS’ personal 2022 Funding Coverage Pointers. Particularly, the probe discovered that the acquisition was made with out the required approvals from the GSIS Belongings and Liabilities Committee, the Threat Oversight Committee, and the Board of Trustees.
The decision additionally famous that the funding breached key GSIS funding guidelines, because the shares weren’t listed on the Philippine Inventory Alternate (PSE) on the time of the settlement and fee. Furthermore, Alternergy failed to satisfy the minimal market capitalization requirement and exceeded the cap on the allowable public float.
No want for board nod
Makati-based Alternergy, which was integrated in June 2009, is chaired by former Vitality Secretary Vicente Perez Jr. With a market capitalization of P4 billion, the corporate is into wind photo voltaic, run-of-river hydro energy, in addition to battery storage.
Veloso argued that the Alternergy deal didn’t require board approval below present GSIS insurance policies.
“Below GSIS coverage, board approval is required just for investments exceeding P1.5 billion,” he mentioned. “The Alternergy funding—P1.45 billion for 100 million most well-liked shares—was properly throughout the authority delegated to the president and normal supervisor.”
Veloso additionally cited Republic Act No. 8291, which permits the GSIS to spend money on most well-liked or frequent shares of listed companies. The regulation, he mentioned, “doesn’t require that the particular shares be listed on the time of purchase-only that the issuing firm be listed and controlled.”
Early returns
Alternergy, he famous, has been listed on the Philippine Inventory Alternate (PSE) since March 2023 and “stays below full regulatory oversight.”
Veloso mentioned the foundations on market capitalization and public float don’t apply on this case, saying these requirements had been designed for investments in publicly traded frequent shares, the place liquidity considerations are an element.
“The Alternergy funding was not for frequent shares. GSIS subscribed to non-traded most well-liked shares, that are fixed-income devices designed for yield, not for buying and selling,” he mentioned, “Making use of market capitalization and public float standards right here displays a failure to know each the character of the instrument and the aim of the coverage.”
In the end, Veloso cited the early returns as proof of the deal’s deserves, saying the GSIS had already earned P117.9 million in money dividends from Alternergy lower than a yr after the funding.
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“This can be a concrete return that strengthens the GSIS fund and immediately advantages our members and pensioners—clearly disproving any suggestion of economic loss or mismanagement,” he mentioned.
