Authorities Service Insurance coverage System (GSIS) president and normal supervisor Jose Arnulfo “Wick” Veloso.
Authorities Service Insurance coverage System (GSIS) President and Common Supervisor Jose Arnulfo “Wick” Veloso on Thursday defended the pension fund’s alleged dangerous funding in renewable power firm Alternergy, saying the P1.45-billion deal complied with all relevant guidelines and rules.
Veloso issued the assertion after being positioned underneath 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 grievance.
The grievance additionally implicated six different GSIS officers and triggered a probe into the due diligence, threat publicity and using 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 firms that “don’t have any confirmed observe file of profitability over the past three years.”
State auditors warned that the transactions—together with the cope with 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 belongings quantity to P1.83 trillion.
‘Unverified grievance’
Veloso maintained that the cope with 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 grievance in preventively suspending me and different hardworking officers of GSIS,” Veloso mentioned.
“Definitely, the skilled judgment of those consultants holds considerably higher 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 stop any potential interference with the continued investigation. The probe facilities on administrative expenses they face for grave misconduct, gross neglect of obligation, and violation of affordable workplace guidelines and rules.
Apart from Veloso, the order covers Government Vice Presidents Michael Praxedes and Jason Teng; Vice Presidents Aaron Samuel Chan and Mary Abigail Cruz-Francisco; officer Jaime Leon Warren and appearing officer Alfredo Pablo.
Alleged violations
In keeping with the Ombudsman’s decision, an investigation launched in January revealed that the GSIS acquired 100 million perpetual most popular shares in Alternergy at P14.50 every, underneath a subscription settlement signed on Nov. 7, 2023. The whole transaction amounted to P1.45 billion.
The Ombudsman discovered that the deal violated the GSIS’ personal 2022 Funding Coverage Tips. Particularly, the probe discovered that the acquisition was made with out the required approvals from the GSIS Property 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 fulfill the minimal market capitalization requirement and exceeded the cap on the allowable public float.
No want for board nod
Makati-based Alternergy, which was included in June 2009, is chaired by former Power 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 underneath present GSIS insurance policies.
“Beneath 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 popular shares—was effectively inside 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 popular or widespread 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 underneath full regulatory oversight.”
Veloso mentioned the foundations on market capitalization and public float don’t apply on this case, saying these requirements have been designed for investments in publicly traded widespread shares, the place liquidity issues are an element.
“The Alternergy funding was not for widespread shares. GSIS subscribed to non-traded most popular 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 grasp each the character of the instrument and the aim of the coverage.”
Finally, 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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“It is a concrete return that strengthens the GSIS fund and instantly advantages our members and pensioners—clearly disproving any suggestion of monetary loss or mismanagement,” he mentioned.
