Ombudsman probers ask bosses: indict Abaya too

Though small in build, Neal H. Cruz was big in stature in Philippine journalism. That is why his passing last week, at age 85, was like the felling of a mighty tree, leaving a gaping hole in the forest canopy. The only consolation is that more sunlight penetrates, to quicken somewhat the growth of those who from Manong Neal drew lessons and inspiration. A teacher of the profession and of life, he shall be missed.

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An old Jewish legend disses lawsuits. Two farmers, fighting over a cow, asked a lawyer-neighbor to settle the ownership dispute. While one farmer was pulling the head of the cow and the other was pulling the tail, the lawyer was milking the cow.

The Philippine Charity Sweepstakes Office would do well to heed that, in its long-running tiff with info-tech provider DFNN.

The publicly listed DFNN recently won a P27-million arbitration. PCSO must pay up for hastily terminating in 2005 DFNN’s contract to enable lotto players to buy tickets electronically (via mobile, Internet, etc.).

DFNN is unsatisfied with the award, though. Citing its very deal with the PCSO, it filed suit to collect a portion of the amount it had spent to develop the on-line lotto betting, plus two-percent interest per month. With the case dragging for 127 months now, the collection accrues to an astounding P310 million as of June 2015.

Yet even before the arbitration win and present civil suit, DFNN showed preference for amicable resolution. It had proposed to PCSO mere reinstatement as exclusive electronic-service provider, as the old contract states – forget all monetary raps. The Office of the Government Corporate Counsel, lawyer of all state agencies, had advised the PCSO to use DFNN’s compromise offer as starting point for final resolution.

Newly appointed PCSO chairman Ireneo Maliksi and director Florencio Noel see wisdom in avoiding any more costly court battles. The agency has lost all its cases against DFNN since 2005. It is under legal order to pay P27 million, and could end up forking out the higher claim. No harm in talking.

But a complication arose. A news item (not in The STAR) quoted an anonymous PCSO staff lawyer as saying DFNN must take the P27 million or none at all – even if its chairman Tony Lopa is an uncle of the President. Slighted, the traded firm said it has been exhausting ways to settle the dispute in court, outside if possible, since five years before Noynoy Aquino came to office.

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Indict Sec. Joseph Emilio Abaya for the MRT-3 maintenance scam. Ombudsman investigators are asking that of higher-ups who earlier cleared the transport chief on flimsy grounds.

The examining lawyers also want charged six transport officers who supposedly rigged the half-billion-peso contract for unqualified but crafty company PH Trams. The six are Undersecretaries Ildefonso Patdu, Rene Limcaoco, Jose Perpetuo Lotilla, and Rafael Antonio Santos (now Appellate Court justice), Asst. Sec. Dante Lantin, and LRT-1 and -2 boss Honorito Chaneco.

They say Abaya and his six direct subordinates were principals in the corrupt contracting of PH Trams, which reportedly led to the MRT-3’s deterioration starting late 2012. Yet the Ombudsman higher-ups had exonerated them last June 26, inciting outrage in social media.

In a memo last July 6 the probers state why graft raps should not be limited to former MRT-3 general manager Al Sanchez Vitangcol III and five accomplices. The five are PH Trams incorporator-directors Marlo dela Cruz, Wilson de Vera, Manolo Maralit, Federico Remo, and Arturo V. Soriano.

It was bad enough that Vitangcol and PH Trams’ owners hid the conflict of interest in Soriano being Vitangcol’s uncle-in-law. That broke the Anti-Graft and Corrupt Practices Act, which bars public officers from contracting relatives up to the fourth degree of consanguinity or affinity. (An uncle-in-law is in the third degree.) Abaya, Lotilla, and Vitangcol signed the deal.

Worse, Abaya’s six subs criminally were negligent in checking the backgrounds of the PH Trams owners, relying solely on what the latter preferred to disclose.

Aside from the Vitangcol-Soriano kinship, PH Trams also was financially unqualified. At the time, two-month-old untried PH Trams had mere P625,000-capital. The ten-month maintenance contract totaled $12.2 million, or P535.5 million, 857 times more. Even PH Trams’ partner CB&T’s P9-million paid-up and P50-million bank credit line was inapt with the enormity of the contract.

The investigators belittle Abaya’s claim of innocence in being only two days in office when he signed PH Trams’ contract on Oct. 20, 2012. Documents show that the first contract was for six months, Oct. 20, 2012-Apr. 19, 2013. Yet Abaya extended it thrice: first Apr. 20-June 19, 2013; then June 20-Aug.19, 2013; and lastly Aug.20-Sept. 4, 2013.

Abaya and Lotilla signed not only the three extensions (the last with Chaneco). They also signed the prior Notices of Award for each to PH Trams.

Abaya had full knowledge of the illegality. The P535.5-million deal, ten months including the three extensions, anomalously exceeded the P350-million budget.

The investigators say the transport officers contrived an emergency – by suddenly not extending the 12-year-long maintenance servicer Sumitomo Corp. in Oct. 2012, to justify closed-door negotiating in lieu of public bidding.

“The DOTC could have easily conducted the public bidding in year 2011, or early 2012,” the Ombudsman lawyers say. “It opted not to because there was no yet emergency then. The genius of the design was to make emergency look more convincing.”

They want Abaya et al punished for grave misconduct, and conduct prejudicial to the best interest of the public service. They also seek other penalties, likely dismissal and disqualification from public office, and civil damages.

The investigators deserve applause for steadfastness in fighting graft: Ryan O. Silvestre, Associate Graft Investigation Officer III; Philip Daniel B. Mathews and James Arnor Borbon, Associate Graft Investigation Officers I; and Francisca A. Maullon-Serfino, Acting Director, Assets Investigation Bureau, Field Investigation Office 1.

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