The prosecution’s financial expert on Monday acknowledged that the Senate impeachment court must determine whether he was justified in treating income from companies linked to Vice President Sara Duterte and her husband as part of his unexplained-wealth computation, conceding that his report did not conclusively establish the legal basis for doing so.
Lawyer-accountant Alexander Cabrera, chairman emeritus of Isla Lipana & Co. (PwC Philippines), invoked the doctrine of piercing the corporate veil to explain why his forensic examination went beyond the companies’ separate legal identities and considered their financial records in assessing the couple’s alleged undeclared wealth.
But during questioning by Sen. Risa Hontiveros, Cabrera acknowledged that the application of the doctrine remained for the senator-judges to evaluate.
“Hindi naman conclusive yung aking report ng piercing of the veil,” he said on the 38th day of Duterte’s impeachment trial.
The issue goes to the heart of Cabrera’s report, which estimated that Duterte and her husband, lawyer Manases Carpio, had ₱817.87 million in allegedly undeclared assets and income from 2022 to 2025.
The figure includes income attributed to three companies — GenCorp Industries Inc., Metro City Chow Foods Corp. and Cale88 Foods Corp. — alongside alleged omissions involving personal assets and income.
Hontiveros questioned why Cabrera included corporate assets in his assessment when a corporation has a legal personality separate from its owners.
Cabrera said piercing the corporate veil allows that separate personality to be disregarded in circumstances where the corporate structure is used to perpetrate abuse.
“Yung legal basis na sinabi ko is piercing the veil of corporate fiction,” he said.
The doctrine does not automatically make a company’s assets the personal property of its shareholders. Its application depends on the circumstances and applicable legal requirements, a distinction central to the questions raised about Cabrera’s methodology.
To explain the principle, Cabrera cited hypothetical cases involving workers seeking unpaid wages and a restaurant customer who suffers food poisoning. He described how an owner might seek to limit liability to a corporation’s assets despite the harm caused.
“The corporation is only liable to the extent of its assets,” he said.
Cabrera argued that the corporate structure should not be used to shield abuse, while Hontiveros framed the doctrine as a means of preserving the legitimate purpose of corporations without allowing their separate identities to be misused.
Corporate financial discrepancies
Cabrera cited discrepancies between corporate bank inflows and amounts reflected in financial records as a key reason for examining the three companies.
“We’re talking of 87% under declaration for GenCorp, 69 for Metro City Chow, more than 50% for Cale88,” he said.
The percentages referred to average annual understatement measures in his report. They were not the proportion of all company funds personally received by Duterte or the share of each company’s total four-year bank inflows missing from its records.
GenCorp drew particular attention in the proceedings. Cabrera previously testified that the company had more than ₱1 billion in allegedly undeclared inflows and that he attributed a 20% economic interest in its undeclared income to Duterte. He based that attribution partly on her interest in Metro City Chow and her significant influence over GenCorp.
During Monday’s proceedings, Cabrera pointed to financial statements he considered difficult to reconcile with the companies’ activities, including substantial earnings alongside relatively small capital and businesses reporting losses despite significant receipts.
“Ito po ang mga telltale signs na may fraudulent reporting na nangyayari,” he said.
Deliberate concealment
Hontiveros also asked Cabrera when an asset omitted from a public official’s Statement of Assets, Liabilities and Net Worth (SALN) could support a finding of unexplained wealth.
Cabrera distinguished a mere omission from what he assessed as deliberate concealment, pointing to the extent of the disparity between a public official’s declared assets and lawful income.
He said the recurrence of substantial discrepancies over several years was significant to his conclusions.
“Hindi po ’yung fact that it was not declared, not that mere fact per se, but the deliberate concealment of the property,” he said.
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