The government should not drag its feet in prosecuting Lloyd Christopher Lao, Michael Wang, Lincolnn Ong and the other executives of Pharmally, as well as their backers in the Senate, former health secretary Francisco Duque and, if evidence warrants, ex-president Rodrigo Duterte.
The Senate already amassed a mountain of evidence to throw the books at Lao, who formerly worked at the Housing and Land Use Regulatory Board (HLURB) before he was seconded to the Procurement Service of the Department of Budget and Management (PS-DBM) to the delight of HLURB employees and property developers, as the Covid-19 pandemic struck and offered opportunities for the worst elements of Philippine society to make a pile from the carcass of the P67.2-billion fund to battle the scourge.
Duterte fans at the Senate naturally did not sign the report of the committee that investigated the Pharmally scam, and they, too, should be made to account for the unjust action they did to coddle the gangsters who made huge piles of money as Filipinos died of Covid-19, all because it was a “shame” to prevent the virus carriers from Wuhan and the rest of China from entering the country. In his 18-page order dated May 2, 2024, Ombudsman Samuel Martires dismissed the plea of Lao to reverse his decision to charge him with graft for his perverse favoritism of Pharmally, a company that was capitalized at P625,000, since other bidders for the supply of surgical masks, face shields and personal protective equipment (PPE) had lower capitalizations, like One Top Medical System Resources and Biosite Medical Instruments, Inc.
Martires told Lao that Section 8 of Republic Act No. 1991 or the Foreign Investment Act of 1991, specifically states that “small and medium-sized domestic market enterprises with paid-in equity capital less than the equivalent of five hundred thousand US dollars ($500,000) are reserved for Philippine nationals.” However, Pharmally was populated by foreigners and Lao cannot invoke the law to justify his award of P8.7 billion to Pharmally, a corporation managed by foreigners, like Huang Tzu Zen, Lin Weixiong and even former Duterte economic adviser Michael Yang, who is Chinese. Two Indians were also employed as Pharmally executives. Under the law, no foreigner may be employed in a partially nationalized corporation without authority from the justice secretary.
The Lower House panel under DIWA Rep. Edgardo Aglipay spared Duterte crony Michael Yang from prosecution but recommended the filing of falsification charges PS-DBM’s Mervin Mendoza and Mervin Tanquintic, as well as syndicated estafa against the following Pharmally officials: Huang Tzu Yen – chairman and president; Linconn Ong – director; Mohit Dargani – corporate secretary and treasurer; Twinkle Dargani, president; Justine Garado, director, and; Krizle Grace Mago – former corporate representative. Mendoza and Tanquintic “received the goods” while the items were still in China.
The House panel said in January 2022 that it did not find enough evidence to recommend charges against Yang and Lao, who was a former aide to Senator Bong Go when he was still special assistant to Duterte. Go himself had been linked to Pharmally and the importation of items from China but he denied the allegations. Ong is also associated with Go and had claimed being close to the senator when he was still working to secure Manila Bay reclamation deals and dredging projects in heavily-silted Zambales rivers, industry sources said.
Martires said without the PS-DBM transactions, Pharmally would be swimming in red ink. “Its financial statements indicate that prior to the 2020 dealings with the PS-DBM, the company had no business activity from September to December 2019. For the year ended 31 December 2019, Pharmally even incurred a net loss of P25,550.00,” he added. “But in 2020, when PS-DBM irregularly awarded procurement contracts to Pharmally, the corporation earned a net taxable income of P318,337,099.00 with a declared net sales/ revenues/ receipts/ fees of P7,485,401,046.00,” the Ombudsman argued.
Aside from the Pharmally mess, the Commission on Audit (COA) also reported that the Department of Health (DOH) had deficiencies in the P42 billion of the P67.32 billion COVID-19 funds it had managed, including its fund transfers to the PS-DBM. Duque claimed the department’s transactions with PD-DBM were “aboveboard” but the documents and records of COA show otherwise. The Ombudsman’s task now is to see beyond the Lower House panel’s recommendations, review the Senate committee’s recommendations and investigate Lao deeply to find out who actually masterminded the Pharmally scam now that Rodrigo Duterte is out of Malacanang.
