Something terrible is happening with Philippine courts. ACT Teachers Rep. France Castro and former Bayan Muna Rep. Satur Ocampo were convicted of child abuse after rescuing children threatened by the paramilitary Alamara in Davao del Sur. Lloyd Christopher Lao, who figured in the Pharmally mess and is charged with the illegal transfer of the P41.4-billion fund of the Department of Health (DOH) to the Procurement Service (PS) of the Department of Budget and Management (DBM) for the procurement of supplies to battle Covid-19, was recently arrested but set free after posting a measly P90,000 bail.
Castro and Ocampo, along with the Talaingod 13, complained that they got a raw deal in the Davao court as they were not afforded the opportunity to present evidence and witnesses on their behalf. This is an odd case where those rescuing students and teachers were found to have committed a crime but not the Alamara paramilitary men backed by the Philippine Army (PA) who boarded up the school and ordered all the children and teachers to leave or else. Castro’s conviction was used by Sara Zimmerman Duterte Carpio to demand her ouster from the Lower House panel deliberating on the P2.037-billion budget of the Office of the Vice President (OVP) for 2025. The case is under appeal.
In the case of Lao, a lawyer, he was shunted off to the Department of Budget and Management (DBM) to head its Procurement Service (PS) after a controversial stint as chief executive officer and commissioner of the Housing and Land Use Regulatory Board (HLURB) from 2017 to 2019. A complaint against Lao for extortion was lodged before the Presidential Anti-Corruption Commission (PACC) in 2019 by socialized housing developers. Before being sent to HLURB, Lao was appointed to the Presidential Management Staff (PMS.) It appears that the Duterte government considers Lao to be a big asset and is thus indispensable. Moreover, he is regarded to be very close to former Duterte special assistant and now Sen. Christopher “Bong” Go.
HLURB insiders noted that property developers were made to contribute to a fund ostensibly to finance socialized housing projects to be undertaken by contractors allegedly chosen by Lao. They claimed the money ended up in a private account, with some claiming the fund increased but as much as P800-million could not be accounted for anymore. The complaint was sent to Lao and nothing has been heard about it since 2019. With the arrest of Lao, the Office of the Ombudsman could take cognizance of the PACC complaint and subject it the investigation by its fact-finding bureau to determine whether the missing P800-million could be a valid ground to slap a plunder charge against him.
Lao was arrested in Davao City after the Office of the Ombudsman filed a graft case against him and former DOH secretary Francisco Duque III before the Sandiganbayan. The graft case is about the transfer of P41.4 billion worth of DOH funds to Lao’s office in 2020 to procure COVID-19 supplies when the PS-DBM still had vague ideas about purchasing such supplies. Ombudsman Samuel Martires also found Duque and Lao guilty of grave misconduct and conduct prejudicial to the best interest of the service in May 2024. Forthwith, the Ombudsman dismissed them from service, forfeited all their retirement benefits and perpetually disqualified them from public service.
The Ombudsman claimed Duque and Lao allegedly gained from the transaction as it charged a 4% service fee totaling P1.659 billion. Duque acted in bad faith when he approved the fund transfer while Lao accepted the funds in bad faith as well as he did not have the supplies needed by DOH. This case is not about the anomalous PS-DBM purchases of COVID-19 supplies from Pharmally, which was financed by Chinese businessman Michael Yang, President Rodrigo Duterte’s erstwhile presidential economic adviser. Lao’s transfer to head the PS-DBM came as the World Health Organization (WHO) declared COVID-19 to be a pandemic.
Aside from proving that Due and Lao profited from the fund transfer, the Ombudsman ought to pursue the Pharmally case with passion since the company organized by Michael Yang cornered P10 billion in pandemic deals between 2020 and 2021 despite it being capitalized at only P625,000 and thus lacked the financial resources to handle big-ticket government procurement. The Commission on Audit (COA) also found that the DOH poorly spent P67 billion of pandemic funds in 2020. The Davao group apparently shared part of the supply deals, with the wife of a politician securing practically all imports of face shields. Yet, the Duterte regime killed the Pharmally case, with the former president attacking the Senate probers who found his key role in enabling the Pharmally executives, Lao and others to complete the scam.
The members of the cast in the Pharmally scandal all belong to the Duterte playhouse. There is, of course, the peripatetic Duterte valet and now senator Bong Go, Lao, once a volunteer election lawyer for Duterte, who was assigned as PS-DBM chief just as COVID-19 pandemic raged in late January 2020. Lao signed off on all the deals between the government and Pharmally. The way it looks, businessmen said, there was self-dealing all over the place, some kind of directors, officers, stockholders and related interests (DOSRI) partaking of billions of pesos gained through price gouging of medical and health supplies. The dramatis personae included Linconn Ong, who had declared himself to be close to Go, and has for a time been involved with reclamation and dredging projects. They may just be responsible for the recurrent flooding in Metro Manila.
