Metro Manila (CNN Philippines, August 24) — The Office of the Ombudsman has found probable cause to file graft charges against former Procurement Service-Department of Budget and Management (PS-DBM) Undersecretary Lloyd Christopher Lao, former PS-DBM procurement group director and now Overall Deputy Ombudsman Warren Rex Liong, and other officials for their involvement in the irregular procurement of COVID-19 test kits from Pharmally Pharmaceutical Corporation.
The Aug. 14 decision signed by Ombudsman Samuel Martires and released on Thursday called for the filing of three graft charges against Lao, Liong, and PS-DBM Procurement Management Officer Paul Jasper de Guzman, and Pharmally executives Mohit Dargani, Twinkle Dargani, Linconn Ong, Huang Tzu Yen, and Justine Garado,
Meanwhile, it recommended one graft charge against ex-PS-DBM executives Christine Marie Suntay, Webster Laureñana, August Ylagan, and Jasonmer Uayan and Pharmally employee Krizle Mago.
It also found Lao, Liong, De Guzman, Laureñana, Ylagan, Uayan, and Suntay guilty on administrative charges. They are facing dismissal from service with forfeiture of all their retirement benefits and perpetual disqualification from government work.
Lao resigned from PS-DBM in 2020, so he is required to pay a fine equivalent to a year’s salary.
An administrative case was filed against them for grave misconduct, gross neglect of duty, serious dishonesty, and conduct prejudicial to the best interest of the service for inking the three deals with Pharmally, which is accused of cornering billions of pesos in supply deals with the help of former and incumbent government officials.
The three transactions in 2020 were for a combined 51,400 units of RT-PCR test kits, with costs totaling ₱4.165 billion.
The Ombudsman said that without the individual acts of the respondents, the procurement of the test kits would not have materialized.
“Respondents’ concerted and conspirational acts enabled the award of a multibillion worth of contract to Pharmally notwithstanding the existence of other corporations that are financially and technically capable to supply and deliver test kits at an equal or lower prices,” a portion of the decision said.
The Ombudsman added that the award of the procurement contract to Pharmally despite the firm’s financial and technical incapabilities as well as lack of business experience, “amounts to respondents’ willful intent” to violate the Government Procurement Reform Act and the rules of the Government Procurement Policy Board.
It noted that Pharmally was incorporated in September 2019, barely seven months before the initial delivery of the test kits, and yet the contract for billions of pesos worth of test kits was awarded.
“Having a paid-up capital of only ₱625,000, the award to Pharmally of the contract to supply and deliver test kits worth over four billion pesos is highly improbable.” the Ombudsman wrote.
Martires said those implicated are allowed to challenge the recommendation by filing a motion for reconsideration.
Meanwhile, the office dismissed the charges filed against other respondents for insufficiency of evidence.
In February 2022, the Senate Blue Ribbon Committee recommended graft, corruption, and plunder charges against Pharmally executives and several public officials, including Lao and former Health Secretary Francisco Duque III, for transferring more than ₱41 billion from the DOH’s COVID-19 fund to the PS-DBM, a portion of which was used to purchase medical goods from Pharmally.
The subject of the Ombudsman’s preliminary probe only covered the procurement of test kits, but government officials and Pharmally were also linked to irregularities in the purchase of face masks, surgical gowns, personal protective equipment, and face shields.
No plunder charges?
Senator Francis “Chiz” Escudero welcomed the recommendation but questioned why plunder charges were not included.
“The wheels of justice may be slow but [continue] to grind nevertheless,” he said in a statement. “I wonder why plunder charges were not recommended given the amount involved which clearly exceeds the threshold of ₱50M for plunder.”
Senator Risa Hontiveros and former Senate President Franklin Drilon meanwhile commended the Ombudsman’s move, which it said serves as a warning to all corrupt individuals.
“Mahalagang hakbang ito tungo sa pagsingil ng accountability at hustisya laban sa mga taong nasa likod ng kahindik-hindik na pagsasayang at maling paggamit ng limitadong pondo ng pamahalaan habang naghihirap ang mga Pilipino sa gitna ng pandaigdigang pandemya,” Hontiveros said.
[Translation: This is an important step towards seeking justice and accountability from those behind the outrageous misuse of limited public funds while Filipinos were suffering during the global pandemic.]
Drilon also expressed hope that the development will lead to the unmasking of all those involved in the anomaly, “including Lao’s backer.”
Both Lao and Liong, as well as the Pharmally executives, have previously denied the allegations against them.
READ: Pharmally to challenge Ombudsman’s graft charges recommendation
