[OpEd Editor’s note: This is Part 2 of "The cat is out of the bag: Fire DOTr undersecretaries and indict former DOTC-LTO officials.” Part 1 appeared yesterday.]
Have you ever wondered why up to now we still don’t have the new car plates, although we have already paid for it? There are some things that we do not know and that they do not want us to know. Well, the cat is now out of the bag.
The Department of Justice (DOJ) in its Resolution dated August 26, 2016 (but which was released only in the second week of November) ordered the indictment of the officials of Power Plates Development Concepts, Inc. (PPDCI) and J. Knieriem B.V. Goes (JKG) for estafa through falsification of commercial documents, false testimony and perjury, and violation of the Government Procurement Act (RA 9184).
It may be recalled that the Commission on Audit (COA) disallowed the controversial P3.8-billion Motor Vehicle License Plate Standardization Program (MVLPSP)of the Land Transportation Office (LTO), under the previous Department of Transportation and Communications (DOTC).
However, up to this time, even under the Duterte administration, the new officials of the DOTr are exhausting all legal remedies to reverse the COA decision. Why are they doing this? Why not rescind the contract? What is behind this? Well, you guessed right.
The MVLPSP project
According to the LTO, the MVSPLP is “a program under the LTO quality management system which aims to aid law enforcement, improve the motor vehicle registration database and enhance the institutional capability of the government through the replacement of all existing motor vehicle license plates with new standardized plates bearing new designs with uniform look. The plate design includes new fonts that are more legible and comes with stainless security locks to attach the plate to the motor vehicle that is meant to prevent the illegal transfer and theft of plates.”
As planned, an invitation to bid (ITB) was published on February 20, 2013, in three major dailies, by then Usec Catherine Jennifer P. Gonzales as overall head of the bids and awards committee (BAC) secretariat. The ITB stated that, “the description of an eligible bidder is contained in the bidding documents, particularly, in Section II Instructions to Bidders and Section III Bid Data Sheet.”
On July 22, 2013, then DOTC Undersecretary Jose Perpetuo M. Lotilla recommended the approval of the notice of award (NOA) to joint venture partners Power Plates Development Concepts, Inc. and J. Knieriem BV-Power Plates (PPI-JKG Phil.). This was duly signed by then DOTC Secretary Joseph A. Abaya and accepted by Christian S. Calalang, managing director of the joint venture, on August 8, 2013.
On February 17, 2014, then Assistant Secretary Alfonso V. Tan, Jr., of the LTO, recommended the approval of the notice to proceed for the “Supply and Delivery of Motor Vehicle License Plates for the Land Transportation Office Motor Vehicle License Plate Standardization Program for a period of five years awarded to PPI–JKG Phil. in the total amount of P1,989,846,820.00 only, for Lot 1 – 5,236,439 pairs motor vehicle plates, and P1,196,162,040.00 only, for Lot 2 – 9,968,017 pieces motorcycle plates, you are hereby directed to commence the delivery of the items within seven (7) calendar days from the date of issuance of this notice.”
Again, this was approved and signed by Abaya and received by the same Mr. Calalang on February 21, 2014. Seven calendar days from February 21 is February 28, 2016. However, no deliveries were made on February 28, 2016–in direct violation of the NTP.
The contract for the project was signed on February 21, 2014 between DOTC, represented by Lotilla, and PPI-JKG Phil., again represented by Calalang, this time signing as its chief executive officer. It was signed in the presence of one Perpetua Camba and notarized by Atty. Ron Salo, legal counsel of PPDCI. Once more, the contract was likewise approved and signed by Abaya.
In the same radio interview with broadcaster Failon on November 16, 2016, Alvarez said the erring individuals should be charged and made to answer for appropriate offenses, because people paid P450 for a pair of regular plates and P120 for a motorcycle plate, all for non-existent plates.
The LTO promised that, “the standardized replacement plates shall be made available to vehicle owners not later than 45 days after the date of registration, at the LTO district office where the renewal of the motor vehicle registration was made.” Of course, just like any traditional politician, promises are made to be broken. The LTO, with the complicity of the then DOTC officials, broke their promise. Apparently, they committed estafa and swindled the vehicle owners.
Assuming that all plates would be disposed of, DOTC-LTO would have collected a staggering P3,552,559,590.00. Thus, making a profit of P366.5 million from the project. Wow, we thought that DOTC would be selling the plates “at cost” to the vehicle owners, meaning the government will not earn from the project. Where will this P366.5 million pesos go?
Admittedly, not all motorists were able to pay for the new plates since its implementation was stopped by the COA and the court. Assuming that 80 percent of motorists already paid for it, then the LTO would have collected some P2,842,047,672.00. Where did this almost three billion pesos go?
Assuming further that only 60 percent paid for the new plates, still this would amount to more than P2.1 billion. The public will just be left scratching their heads, wondering where this huge amount of money went.
The DOJ resolution
The Department of Justice’s resolution ordering the filing of informations against the officials of PPDCI and JKG stemmed from the complaint filed by the Anti-Trapo Movement of the Philippines against the former, docketed as NPS Doc. No. XVI-INV-13J-00363.
The resolution was based on several pieces of evidence, among which are the 2011 Annual Accounts of JKG issued by the Chamber of Commerce of The Hague, The Netherlands, the 2011 Consolidated Accounts of H3 BV, the news article regarding the submission of alleged false eligibility documents on the DOTC-LTO Supply and Delivery of Motor Vehicles License Plates for the LTO MVLPSP program, and the letter of respondent Christian S. Calalang refuting the news article.
Accordingly, in order to participate in the bidding for the project, PPI and JKG entered into a joint venture agreement. In the joint venture, Power Plates and JKG agreed to pool their resources, manpower, and expertise, and to be held jointly and severally liable towards the undertaking and participation in the public bidding of the DOTC-LTO MVLPSP project.
The DOJ found that, “In the bidding, the respondents submitted a document purporting to be the Audited Financial Statement of JKG. Such audited financial statement is one of the requirements for them to qualify as bidder. However, upon careful examination of the said document, it turned out that it is not the audited financial statement of JKG. What the respondents submitted during the bidding were the 2011 Annual Accounts of the Respondent JKG issued by the Chamber of Commerce of The Hague, The Netherlands, the 2011 Consolidated Accounts of H3 BV.”
“In respondent Calalang’s letter refuting the news article regarding the submission of alleged false eligibility documents on said DOTC-LTO Supply and Delivery of Motor Vehicles License Plates for the LTO Motor Vehicle License Plate Standardization Program, he did not refute the allegation that JKG and PPDCI submitted a document, which is not actually an audited financial statement of JKG. It is also noteworthy that he admitted that they submitted the financial statement of H3 BV, the parent company of JKG.”
“The 2011 Consolidated Account of H3 B.V. shows the following data:
“A negative €215,068.00 as net income”
“A gross margin or gross income of €5,003,546.00 for calendar year 2011”
“The Current and Total Assets of all seven (7) subsidiaries H3 B.V. only amounted to €6.264.360 or P338,275,440.00 and €11.250.093 or P607,505,022.00, respectively.”
“The 2011 Consolidated Accounts of H3 BV shows that the Net Income for 2011 of all its seven (7) subsidiaries, which include JKG, yielded a negative amount of €215.068. The negative Net Income and Gross Income therein declared do not only pertain to JKG but likewise includes that of the other six (6) subsidiaries under the holding company H3 BV.”
“Thus, JKG and PPDCI submitted a falsified 2011 Annual Report and claimed it to be the audited financial statement of JKG because none such audited financial statement exists. Or if one exists, the contents will show that JKG is not qualified to bid for the DOTC-LTO project. This would be the reasonable conclusion especially since the respondents did not submit their countervailing evidence showing their financial capability to undertake the project.”
“The respondents then submitted and used the said falsified document to the DOTC-BAC to qualify as a bidder in the DOTC-LTO project and eventually they were awarded with the contract for the Supply and Delivery of Motor Vehicle License Plates for the LTO Motor Vehicle License Plate Standardization Program.”
“The respondents thus committed falsification and use of falsified documents during the bidding of the said DOTC-LTO project when they issued in an authenticated form a document purporting to be a copy of an original document when no such original exists, or including in such a copy a statement contrary to, or different from, that of the genuine original.”
“But it does not end there. The falsification committed by the respondents was only a means of committing another crime, which is estafa. They falsified the audited financial statement not only for purposes of bidding at the project but also to be able [t[to]fraud the government and the public. Through falsification, the respondents were awarded the project, manufactured or will manufacture the license plates, and sold or will sell the same to the public. That way, the government and the public incurred damages.”
“In the instant case, it appears that the respondents submitted falsified documents and false information to the BAC of the DOTC-LTO’s project to supply and deliver motor vehicles license plates for its LTO Motor Vehicle License Plate Standardization Program. Hence there is probable cause to charge them with violation of the said section of RA 9184.”
The justice department further established that conspiracy existed among the respondents, PPI and JKG, and the DOTC-BAC. The DOJ reckoned that in conspiracy, the act of one is the act of all, and all of the respondents should be charged for the offenses where probable cause had been established.
DOTC-LTO Officials should be included
The DOJ stressed that the conspiracy of the car plate manufacturers to commit the offenses, as charged, would not have succeeded without the knowledge, intervention, act of omission of the members of the BAC. The latter, however, were not charged in the complaint.
Still, it is not yet too late for the former DOTC officials to be indicted. The DOJ emphasized that John Does had also been named as respondents.
“If in the course of the subsequent proceeding in this case or during trial on the merits of the cases filed in the proper court, the identities of the other conspirators are unmasked, then, considering that public interest is involved hereof, they should be accordingly charged and made to answer for appropriate offenses that will be established,” it said.
The DOJ resolution was written by Assistant State Prosecutor Ricardo C. Estrabo, recommended for approval by Senior Deputy State Prosecutor Richard Anthony D. Fadullon, and approved by the Prosecutor General Claro A. Arellano.
Clearly, other personalities should be charged in this fiasco. These include the PPI-JKG counsel who notarized the contract, the LTO Chief who issued the notice to proceed, DOTC-BAC members who qualified the joint venture, and all other former DOTC officials who approved and signed the pertinent documents.
Somebody asked me if the current officials of the DOTr can similarly be charged in court for these same offenses. My quick answer is in the affirmative–if they will continue to pursue this contract.
What has been written in this column should now serve as a judicial notice to the officials of the DOTr. Knowing fully well the events leading to the motor vehicle plates fiasco, the DOTr should now rescind the contract and abandon their appeal to the COA.
Speaker Alvarez could not have put it more bluntly: “Ang problema diyan marami silang tinatago sa Kongreso.
My insight tells me that DOTr officials are hiding something and it is about time they answer a lot of questions.
As I have stated, there are some things that we do not know and that they do not want us to know. However, the cat is now out of the bag.