OSG affirms LTO's temporary control of Stradcom

MANILA, Philippines - The government has opposed a bid of one of the warring factions of Stradcom Corp., the information technology provider of the Land Transportation Office (LTO), to control the facility pending resolution of the intra-corporate dispute highlighted by the failed takeover of their building last month by the other group.

The Office of the Solicitor General (OSG) affirmed the legality of LTO chief Virginia Torres’ move to temporarily control the Stradcom facility until it is determined which group between Cezar Quiambao and Bonifacio Sumbilla should be recognized as the legitimate board of directors of the firm.

“Considering that the LTO has taken over the operations of Stradcom, it would be more prudent for the LTO to continue the same pending the resolution of the dispute within Stradcom. Because there are two sets of directors, each claiming to be legitimate, the Stradcom must first resolve the dispute among its ranks. They must litigate or the LTO can file an inter-pleader to settle the controversy,” said the letter signed by Solicitor General Joel Cadiz obtained by The STAR.

The OSG also stressed that “the Quiambao group, which prior to the failed Dec. 9 takeover had control of Stradcom, cannot demand restoration of the Stradcom Facility and operation on the justification of payroll processing” simply because it remains “unclear as to which group has the authority and control over Stradcom.”

OSG’s position was submitted to the fact-finding investigation of the Department of Justice tomorrow to determine if LTO officials could be held liable for the failed takeover of the Stradcom last month that had disrupted operations of agency for almost seven hours.

The Sumbilla group also tried to get control of the facility by applying for temporary protection order against LTO, which the Quezon City Regional Trial Court Branch 91 had earlier denied.

The confusion as to who really are the legitimate officers of Stradcom started when Sumbilla group presented themselves as the newly elected board of directors of the company.

Sumbilla submitted a certified true copy of Stradcom’s General Information Sheet (GIS) from Securities and Exchange Commission dated Dec.1, 2010 naming him and his supporters as elected board of directors and officers of the firm.

Quiambao’s group, on the other hand, also presented a GIS from SEC naming them as board of directors. But their document was dated May 31, 2010, or older than the document presented by Sumbilla’s group.

Torres, who was handpicked by President Aquino for the task of cleaning LTO that has been long beleaguered by talks of anomalies and inefficiency, believes the bottomline in the conflict is the almost P12-billion profit of Stradcom.

The LTO chief, however, stressed that this amount is just an estimate because only a portion of this figure is being remitted by LTO to Stradcom, the rest is paid directly by Private Emission Testing Centers (PETCs) and Insurance Companies to Stradcom.

Torres explained that this figure was estimated using the exact figure from LTO payments to Stradcom of P 9,713,363,142.47 for computer fees for 2002 to 2010. The remaining amount was estimated as P1.273 billion from connectivity fees collected by Stradcom from the PETC and P950 million for connectivity fees for verification of certificates of cover (of insurance).

Torres, who has been with the LTO for 32 years, hopes the President would not be swayed by an apparent attempt to oust her from office due to the controversy.

In an earlier hearing of the DOJ panel, she claimed that she was “a victim caught in the crossfire of wrangling businessmen.”

“I have always maintained neutrality in this war. Mr. Quiambao directed his battery of attacks on us, perhaps hoping that in doing so, he could gain leverage and win over his adversary,” she told the probe panel chaired by Justice Undersecretary Francisco Baraan III.

Torres said the accusation that she had aided Sumbilla’s group in the takeover attempt as shown by the video footage showing them entering the building together was part of a “colorful story attached to my actions before, on the day, and after the events and conjured by malicious minds.”

She maintained that her actions were “protective of the interest of the public” and “consistent with my sworn obligation to advance the interest of the public.”