LTO contractor charged with plunder for P2-billion 'illegal' fees

MANILA, Philippines - A group filed plunder charges before the Department of Justice (DOJ) yesterday against Stradcom Corp., information technology provider of the Land Transportation Office (LTO), for more than P2 billion in interconnectivity fees it collected from motorists that are purportedly outside its contract with the government.

In a complaint to Justice Secretary Leila de Lima, the Road Users Protection Advocates (RUPA) alleged that the interconnectivity fees collected by Stradcom are not covered by its build-own-operate (BOO) contract with the LTO.

LTO records show Stradcom has collected P1.273 billion in interconnectivity fees from private emission testing centers (PETCs) and P950 million in interconnectivity fees for verification of certificates of insurance coverage.

“These collections are not part of the original authorizations and undertakings in the LTO-IT (contract), and these are in amounts far in excess of the threshold for plunder,” RUPA representative William Obrero Jr. said in the complaint.

Obrero said Stradcom continues to collect these fees despite a notice of disallowance issued by the Commission on Audit (COA) in October 2005, which found the amendatory provisions and contract revisions in the BOO contract between the IT provider and LTO as “grossly disadvantageous to the public and to the government.”

He cited Stradcom’s alleged continued defiance of orders by the COA and Department of Transportation and Communications (DOTC) for the refund of P31 million in radiofrequency identification (RFID) fees collected from car owners in 2009.

Stradcom denied the allegation. In a statement to The STAR, the firm said “the road users’ group is misinformed. Interconnectivity fees are for operations that are beyond the scope of the primary LTO contract for computerization of driver’s license and motor vehicle registration.”

The firm said the interconnectivity charges were just “added services” upon the directive of LTO.

The firm said the Supreme Court only issued a status quo ante order stopping the RFID collection and did not explicitly order the refund of the P31 million collected for the pilot-testing of the RFID project.