Overall Deputy Ombudsman Liong, others put on preventive suspension over Pharmally mess
MANILA, Philippines (Update 2, 2:06 p.m.) — The Office of the Ombudsman has ordered the preventive suspension for six months of people it is investigating for alleged corruption in the procurement of pandemic response supplies.
At least one person named in the complaint — former budget department procurement service head Lloyd Christopher Lao — has left government but the suspension order also covers Overall Deputy Ombudsman Warren Rex Liong.
Lao and Liong were in the Procurement Service of the Department of Budget and Management when it entered into deals with Pharmally Pharmaceutical Corp., a little-known company that bagged the lion's share of government contracts for face shields, face masks and COVID-19 test kits.
RELATED: ‘Shortcut’: Senators call out incomplete, anomalous Pharmally procurement papers
The suspension order stemmed from complaints filed by Sen. Risa Hontiveros and then-Sen. Richard Gordon against Lao, Liong and dozens others from PS-DBM and from the Department of Health before the Ombudsman.
The administrative complaint cited three procurements of RT-PCR tests — two in April and one in June — in 2020 worth around P4.1 billion.
"The overwhelming documentary proof shows that respondents' evidence of guilt is strong," Ombudsman Samuel Martires said in the order, in laying down the justifications for the preventive suspension.
He also said that the respondents are accused of grave misconduct, gross neglect of duty, serious dishonesty and conduct prejudicial to the best interest of the service and that the gravity of these offenses, coupled with the seriousness of their participation would warrant removal from the service.
Given these, Martires said, his office "finds compelling reasons to place the respondents under preventive suspension pending investigation of the instant case."
Preventive suspension is not a penalty but a mechanism to prevent government officials and employees from interfering with or influencing an investigation.
The STAR newspaper reported in a tweet on Thursday afternoon that Liong said he will abide by the preventive suspension but also said that he was in no way involved in alleged anomalies at the PS-DBM.
Hontiveros: Ombudsman move validates panel findings
In a statement on Thursday afternoon, Hontiveros thanked the Office of the Ombudsman for "being true to its mandate" and for validating Senate committee findings on the Pharmally mess.
"My hope is that the investigation will also look into the masterminds behind this modus, well beyond the foot soldiers and mid-level officials," she also said. "Although the Ombudsman order only covers the COVID-19 test kits, we look forward to an investigation of the PPEs and other overpriced procurements."
She added that she is hopeful that a special audit by the Commission on Audit, whose initial audit report into DOH pandemic spending prompted the probe, would uncover more details of the alleged corruption.
"Any and all ill-gotten profit made from taxpayers' money should eventually be seized and turned back over to the government where it belongs," Hontiveros also said.
RELATED: BIR says probing suppliers who cornered deals worth P42-B with PS-DBM
Congressional hearings
The Pharmally transactions were the subject of a series of hearings by the Senate blue ribbon committee — chaired at the time by Gordon — into allegations that the deals were irregular and that the supplies bought from Pharmally were overpriced.
The hearings expanded to include businessman Michael Yang — a friend and former adviser of then-President Rodrigo Duterte — whom Pharmally Pharmaceutical Corp. chairman Huang Tzu Yen, a Singaporean businessman, told senators had stood as financier and backer of the poorly-capitalized medical supplies firm.
The probe into Pharmally, which was part of a bigger series of hearings on government pandemic spending, led to an open word war between Duterte and Gordon, whom the president accused of impropriety as chairman of the Philippine Red Cross.
READ: Duterte orders SolGen: Ask COA to audit Philippine Red Cross
The House also held hearings on government pandemic spending, with lawmakers there arguing that the Bayanihan to Heal As One Act gave the government emergency powers to do away with stricter procurement rules.
The House Committee on Good Government and Public Accountability later recommended criminal charges against Pharmally execs for "soliciting supply contracts from the government despite knowing it was grossly unqualified to do so and tantamount to fraudulent misrepresentation resulting in damage and disadvantage to the government."
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