House panel recommends charges vs Pharmally execs, absolves govt of overpricing

Metro Manila (CNN Philippines, January 31) — Lawmakers sought syndicated estafa charges against six officials of a controversial government medical supplier over the purchase of COVID-19 response items, while the Procurement Service of the Department of Budget and Management (PS-DBM) was deemed off the hook for overpricing allegations.

The House Committee on Good Government and Public Accountability announced on Monday recommended charges against Pharmally President Huang Tzu Yen, Director Linconn Ong, Mohit and Twinkle Dargani, Justine Garado, and Krizle Grace Mago for allegedly soliciting government contracts even if their company lacked the financial capability to meet its obligations.

“The act of Pharmally officials and employees in soliciting supply contracts from the government despite full knowledge that it was grossly unqualified to do so and tantamount [to] fraudulent misrepresentation resulting in damage and disadvantage to the government,” committee chairman and Diwa party-list Rep. Michael Aglipay said, quoting the committee report.

He added Pharmally “gravely abused” the system by taking advantage of rules under the Bayanihan to Heal as One Act on the government’s pandemic response and “misappropriated” P8.68 billion in public funds.

The panel also recommended the filing of charges for falsification of public documents against Jorge Mendoza II and Mervin Ian Tanquintic of PS-DBM. They allegedly signed inspection documents for COVID-19 supplies that came from China even before the items were delivered.

No recommendation for charges vs. Yang, Lao

Aglipay said they found no overpricing in the PS-DBM purchase of COVID-19 response supplies.

He said procedures done by the agency previously led by former PS-DBM chief Lloyd Christopher Lao to procure supplies and equipment in behalf of the Department of Health were in line with the law that guides the government's pandemic response.

Aglipay said there was "insufficient evidence" to sue Lao and former presidential economic adviser Michael Yang, who is the supposed financier of Pharmally which bagged billions worth of government contracts despite the company's insufficient capital.

"The evidence does not warrant or is not enough for cases to hold," Aglipay said.

Despite absolving Lao, the committee recommended the abolition of PS-DBM to streamline government functions and services.

"PS-DBM has outlived its purpose considering that all agencies now have their own procurement department and BAC (Bids and Awards Committee," the report read.

The House panel conducted investigations on the government’s purchase of COVID-19 supplies from September to October last year.

The committee's recommendations will be submitted to the plenary for adoption by the House.

CNN Philippines correspondent Xianne Arcangel contributed to this report