Witness list in Duque graft case includes Gordon, Hontiveros

MANILA, Philippines —  The Office of the Ombudsman has listed Sen. Risa Hontiveros and former senator Richard Gordon as among its witnesses in the graft case it filed before the Sandiganbayan against former health secretary Francisco Duque III and former Department of Budget and Management Procurement Service (PS-DBM) executive director Lloyd Christopher Lao.

Based on the charge sheet, a copy of which was obtained by The STAR, Hontiveros and Gordon are among six people eyed by the ombudsman as witnesses in the case.

The other possible witnesses are Senate Blue Ribbon Oversight Office Management director general Rodolfo Noel Quimbo, state auditor Raymond Vallejo of the Commission on Audit (COA) Fraud Audit Office-Special Services Sector, PS-DBM Administrative Finance Group officer-in-charge director Arnold James Dupla and Department of Health (DOH) Accounting Division officer-in-charge head accountant Filipina Velasquez.

The ombudsman also included the words “and others” so it could present other individuals as witnesses, if necessary.

On Tuesday, the ombudsman charged Duque and Lao before the Sandiganbayan with one count each of violation of Section 3 (e) of Republic Act 3019 or the Anti-Graft and Corrupt Practices Act, which prohibits public officials from giving unwarranted benefit, advantage or preference to a private party or from causing any party, including the government, undue injury.

The case was raffled off yesterday to the Sandiganbayan First Division, chaired by Associate Justice Maria Theresa Mendoza-Arcega with Associate Justices Bayani Jacinto and Juliet Manalo-San Gaspar as members.

The ombudsman has recommended a P90,000 bail bond for each of the accused.

As of yesterday afternoon, Duque and Lao had not posted bail. A court staff of the First Division, who wished anonymity, said no arrest warrant had been issued as of closing of the Sandiganbayan office.

The staff, however, clarified that Duque and Lao may post their bond without waiting for any arrest warrant from the court.

The case stemmed from alleged irregularities in the DOH’s transfer of P41.46 billion to PS-DBM at the height of the COVID-19 pandemic in 2020.

The fund transfer was supposedly for PS-DBM’s procurement of medical supplies needed by the DOH for the government’s pandemic response.

Based on the charge sheet, prepared by Graft Investigation and Prosecution Officer III Napoleon Regan Malimas and approved by Ombudsman Samuel Martires on Aug. 16, the fund transfer of P4.4 billion was not supported by any valid Memorandum of Agreement between the DOH and PS-DBM.

Furthermore, the ombudsman said the fund transfer “did not hasten” the implementation of the procurement project.

The ombudsman said its investigation also revealed that the DOH “had the capacity and proficiency to undertake the procurement” itself.

No certification

The ombudsman said the DOH transferred the funds despite the lack of certification that the PS-DBM had already liquidated the funds received from the department, “in utter disregard” of procurement laws and government auditing rules.

The ombudsman said its investigation also revealed that the medical supplies and equipment needed by the DOH such as test kits, mechanical ventilators, surgical masks, personal protective equipment, nucleic acid extraction machine and cadaver bags were not even in the inventory of the PS-DBM.

“Lao accepted said transfer of funds by DOH for the procurement of COVID-19 medical supplies and equipment that are not available in the PS-DBM inventory and notwithstanding non-compliance with aforementioned procurement law, rules and issuances as well as the aforecited accounting and auditing rules on transfer of funds from one agency to another,” the ombudsman’s case information sheet read.

As a result of the unlawful transfer, the government lost P1.658 billion, representing the four percent service fee that the PS-DBM had charged the DOH for supposedly carrying out the procurements.

The ombudsman’s investigation on Duque, Lao and the other DOH officials stemmed from a 2020 COA report and from a complaint filed by Hontiveros and Gordon in 2022 following months of hearings by the Senate Blue Ribbon panel on the issue.

In its 2020 annual audit report on the DOH, the COA flagged several “deficiencies” in the health agency’s utilization of P67.32 billion in COVID-19 funds, including the unspent P11.89 billion intended for the procurement of various medical equipment and supplies and payment of benefits for health workers, and the P41.46-billion fund transferred to PS-DBM despite the lack of the required MOA and other supporting documents.

In their complaint, meanwhile, Hontiveros and Gordon said that of the funds received by PS-DBM from DOH, P11.5 billion was paid to start up Pharmally Pharmaceutical Corp., as well as fund the supply of face shields, face masks, test kits and other medical items for the government’s pandemic response.

The procured items were allegedly overpriced while some were already expired upon delivery. –  Rhodina Villanueva