News update Philippines charges former minister with graft

MANILA, July 16, 2010 (AFP) – Philippine prosecutors on Friday charged a minister in former president Gloria Arroyo's administration with graft over a murky deal with a Chinese Internet firm, officials said.

Former economic planning secretary Romulo Neri immediately pleaded not guilty at an anti-graft court.

"I am saddened," the Philippine Daily Inquirer newspaper's website quoted Neri as saying shortly after filing his plea.

State prosecutors alleged Neri profited from a 329-million-dollar contract awarded to Chinese firm ZTE Corp. in 2007 to set up an Internet broadband network for Arroyo's then-government.

A mid-level official charged in 2007 that Neri helped broker a deal where Arroyo's husband and a political ally would get millions in dollars in kickbacks from ZTE Corp. in exchange for the contract.

The deal with ZTE Corp. collapsed that year due to the allegations, with Arroyo stepping in to cancel it following a wave of bad publicity.

The Senate later recommended that graft charges be filed against Arroyo's husband, Neri and other officials.

The state prosecutors said last year that there was evidence to charge Neri, but not Arroyo or her husband.

Neri's lawyer, Paul Lentejas, said he was confident his client would be found innocent, pointing out that the former secretary had already been questioned extensively by legislators.

"He revealed everything about the deal already. There is nothing more for him to add," Lentejas said in an interview with ABS-CBN television.

President Benigno Aquino, who took over from Arroyo on June 30, has vowed to look into the ZTE contract and other allegations of massive corruption during Arroyo's nine years in office.

He has created a "truth commission" headed by a former Supreme Court justice to investigate allegations which left Arroyo as one of the most unpopular presidents in memory.

The decision to pursue Neri was independent of the truth commission.