Lacson suspects collusion, lack of due diligence in award of P8-B deals to firm for PPEs, test kits

There may have been a collusion or lack of due diligence by former Department of Budget and Management Procurement Service (DBM-PS) chief Lloyd Christopher Lao in awarding a multibillion-peso contract involving face masks, face shields, test kits and personal protective equipment (PPEs) to a newly incorporated company.

Former Budget Undersecretary Lloyd Christopher Lao addresses issues related to the purchase of medical supplies during an interview over Laging Handa public briefing on People's Television Network on August 20, 2021. (PTV screenshot)

Senator Panfilo M. Lacson raised these possibilities Friday, August 27, after grilling Lao during the Senate Blue Ribbon Committee's hearing on red flags raised by the Commission on Audit (COA) on the Department of Health's (DOH) transactions.

"Either there was lack of due diligence for reasons of collusion, or they are sloppy. I don’t know what to believe. Being the head of the PS-DBM, a trained and experienced procuring entity of government, yet not even detecting a fake address by the incorporators, I wonder how they were able to award the procurement of billions of pesos of items," Lacson said.

"You are dealing with billions of pesos worth of public funds," he pointed out.

Lacson questioned Lao's failure to do a due diligence check on Pharmally Pharma Corporation which Senate Minority Leader Franklin M. Drilon said got a whopping P8.6-billion contract despite being incorporated only in September 2019 and with a capital of some P600,000.

Senators also said that one of the incorporators gave an address that turned out to be nonexistent, even as the company had no track record.

Lao, in response, admitted that he "failed to check" the background of Pharmally.

"You did not follow proper procedure. You threw out of the window all the requirements. Either you did it on your own or someone ordered you to award the contracts...Clearly there’s a collusion. How can you award billions of pesos worth of contracts to nonexistent addressees?" he told Lao.

Lacson also chided Lao for supposedly being evasive during the committee hearing.

"Being evasive is a ground for citing in contempt... If anyone would move to cite him in contempt of this committee I will support, I will second the motion," he said.