By ARIES C. RUFO
abs-cbnNEWS.com/Newsbreak

(First of two parts)

Is Ombudman Merceditas Gutierrez ready to make war with the House of Representatives?

Documents submitted to the Ombudsman in 2006, copies of which were obtained by abs-cbnNews.com/Newsbreak, establish criminal liability of some members of Congress for active participation in the diversion of the P728 million fertilizer fund before and during the election campaign in 2004.

Just before the Senate terminated its probe on the fertilizer scam in March 2006, Gutierrez formed Task Force Abono to dig deeper into the anomaly. It was also formed in connection with the formal complaint filed by former Solicitor-General Frank Chavez and the militant Kilusang Magbubukid ng Pilipinas. The Task Force was composed of Ombudsman investigators.

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These investigators identified select transactions involving the use of fertilizer funds by House members and local officials. Their findings: purchased farm equipment were overpriced by as much as 200 to 300 percent, there was absence of public bidding, and public funds were used illegally.

Assistant Ombudsman Mark Jalandoni has said in a previous interview that the Ombudsman will soon start preliminary investigation on the scam. "We are just finalizing the initial report of the Field Investigation Office," he said. There was no mention however if some House members will be summoned.

In a separate inquiry, the Senate committee of agriculture and Blue Ribbon committee sought the indictment of agriculture officials, led by former Undersecretary Jocelyn Bolante, for plunder and graft in the dissipation of the funds. Bolante is now detained in the US pending an appeal for his asylum bid.

Don’t mess with the congressmen

During the Senate probe, a self-confessed runner, Jose Barredo Jr., identified one congresswoman and five congressmen who financially benefited from the fertilizer fund through the so-called "standard operating procedure." In his testimony, Barredo said the House members sought 30 percent commission from the amounts allocated to them.

The Senate committee report did not mention the culpability of the identified House members. The Senate report sought the filing of charges against local officials, "whether elected or appointed" for complicity in the scam.

But they left the congressmen out.

Former Senator Ramon Magsaysay Jr, who led the Senate probe on the P728 million fund, told this writer that the committee probe focused on the executive branch.

"We did not want to fight the entire government. We did not want to hustle with the members of Congress. There is such thing as parliamentary courtesy," he said.

Overpriced farm equipment

One of the transactions that TF Abono investigated involved the purchase of 14 farm implements and facilities amounting to P14 million in Region 4. Three members of Congress and one governor, at that time, were identified as the proponents of the transactions.

Records showed that as proponents, incumbent Quezon City Rep. Nanette Daza, then Malabon-Navotas Rep. Federico Sandoval II, then Batangas Rep. Oscar Gozos and then Marinduque governor Carmecita Reyes, endorsed the purchase of the farm implements to the DA Regional Field Unit Office-IV. Daza, Sandoval and Gozos were allocated P3 million each from the fertilizer fund while Reyes got P5 million.

Armed with letters of endorsement from the proponents, the DA RFU-IV purchased five towable shedders and one small shredder from LCV Design and Fabrication Corp (LCV). The five towable shedders each cost P750,000 while the small shedder cost P250,000.

But a special audit done by the Commission on Audit found that the five towable shredders purchased from LCV were grossly overpriced by more than 300 percent while a smaller shredder/chipper was overpriced by 200 percent.

A canvass with other suppliers showed that the towable shedders cost only P226,320 each while the small shedder cost only P121,055.

No public bidding

The audit team also noted that the 14 units of mechanical farm equipment, including the shedder, were not among those classified as the required farm equipment under the GMA Rice Program. Worse, no public bidding was conducted.

Based on the above circumstances, "the P14 million spent in purchasing farm implements from LVC was not properly used for its intended purpose" which "constitutes the felony of technical malversation," Task Force Abono said in its preliminary report.

The DA’s RFU-IV violated the Government Procurement Reform Act when it resorted to direct contracting with the LVC since the farm implements it sold were "equipment with similar functions which are available in the market."

In linking the House members and Reyes to the anomaly, the Ombudsman report stressed that the farm equipment was bought based on their letters of endorsement. "This clearly shows that the named public officials had a direct hand in the questioned transaction."

More irregularities

The liquidation accounts also show signs of more irregularities.

In the case of Daza, Ombudsman investigators observed that her letter request, the resolution of the Bids and Awards Committee, the purchase request and the purchase order all bore the same date (April 14, 2004). She signed the acknowledgement receipt, invoice receipt for property, purchase request requisition and issue slip.

In Sandoval’s case, the date of the purchase order (May 7, 2004) was ahead of the submitted quotation of the supplier (May 13, 2004). He signed the purchase request.

In the case of Gozos, the purchase order was undated, as well as the receipt of the purchase order. Gozos signed the acknowledgement receipt, invoice receipt for property, purchase request, requisition and issue slip.

As for Reyes, the date of the receipt of the purchase order was not indicated. She was also a signatory to all the other documents.

"The foregoing observations only manifest the existence of irregularity in the transaction entered by the DA-RFU IV, LCV and other public officials involved," the report said.

Daza is on her third term while Sandoval and Gozos are no longer House members. Sandoval ran but lost in the mayoralty race in Navotas in last year’s elections, while Gozos is now incumbent mayor of Lipa. Reyes is the present representative of the lone district of Marinduque.

Prima facie evidence

The Ombudsman probers said there is "prima facie evidence" to warrant the filing of criminal as well as administrative charges against the DA officials led by Bolante and the House members. The report sought the preventive suspension of the House members and Reyes.

We contacted the office of Reyes but a staff said she is out of the country. Daza’s office, on the other hand, gave no comment. We also contacted Gozos’s office in Lipa but we were told the mayor was not around. We requested for a return call but we did not receive any response yet as of this writing.

Based on the special COA audit, some 103 House members, 49 governors and 26 mayors were identified as proponents of the fertilizer fund. But Magsaysay said it appears some of the House members were merely used in the scam.

They include former Education Secretary and Batanes Rep. Florencio Abad, former Tarlac representative and now Senator Benigno "Noynoy’ Aquino Jr., and Muntinlupa Rep. Rufino Biazon.

Others who quickly denied receiving any amount from the fertilizer fund include Makati

Rep. Teodoro Locsin Sr. and Albay Rep. Edcel Lagman. The special COA audit showed there were 17 House members who were supposed to be proponents, or have made requests for allocation in the fertilizer fund, but did not actually benefit from the fund.

Illegal use of public funds

Of the 103 House members who were beneficiaries of the fund as reported by COA, 35 are incumbent in the present 14th Congress, a check by abs-cbnNews.com/Newsbreak showed. The figure includes the seven House members who were not among the original proponents based on the list prepared by Bolante but received actual releases of the fund.

At face value, an Ombudsman source said the seven House members can be held liable for the scam for violation of Article 220 of the Revised Penal Code or the illegal use of public funds.

The Ombudsman source could not say if more House members from the 103 proponents were sought to be indicted in other preliminary investigations conducted by TF Abono.

We sought comment from Assistant Ombudsman Mark Jalandoni but he ignored our text messages.