A graft complaint has been filed against Bureau of Fisheries and Aquatic Resources (BFAR) Director Eduardo B. Gongona and four others before the Office of the Ombudsman (OMB) for alleged anomalous purchase of Vessel Monitoring System (VMS) transceivers worth P2.09 billion from a British company in 2018.
Also charged in the complaint, which was officially received by the OMB last March 1, were Department of Agriculture (DA)-BFAR bids and awards committee chairpersons Demosthenes R. Escoto and Hansel O. Didulo, and private individuals Chief Executive Officer Simon Tucker and Chief Financial Officer Richard Hurd of SRT Marine Systems Solutions Ltd.
The complainant, lawyer James Mier Victoriano, asked the OMB to charge them with violations of Sections 3(e), 3(g), and 3(j) of Republic Act No. 3019 or the Anti-Graft and Corrupt Practices Act.
He also wants them held liable for violations of Sections 30, 34, 65(c), and 65(d) of Republic Act No. 9184, the Government Procurement Reform Act, and Section 23.6 of the Revised IRR (Implementing Rules and Regulations) of RA 9184.
Victoriano alleged in his complaint:
“The illegal acts of the respondents in knowingly (1) awarding the Project to an ineligible bidder, in violation of the terms and conditions of DA-BFAR’s own Invitation to Bid, which resulted in the loss of foreign assistance loan and consequently the increase in the needed costs for local funding of the Project; (2) modifying the terms of the procurement of VMS Transceivers for the Project, in contravention with the relevant provisions under R.A. No. 8550, as amended, which result in an excessive purchase requirement; and (3) the apparent unsustainability and excessiveness of the awarded procurement, are bases enough to hold the Public and Private Respondents criminally liable for the violation of Section 3, subparagraphs (e), (g), and (f) of R.A. No. 3019; Sections 30, 34, 65(c), and 65(d) of R.A. No. 9184; and Section 23.6 of the Revised Implementing Rules and Regulations (“Revised IRR”) of R.A. No. 9184.”
(Efforts to contact those named in the complaint were futile. It has been Manila Bulletin’s policy to publish the answer of the respondents in the complaint once filed with the OMB.)
Victoriano said the purchase of VMS was made for the BFAR's Integrated Marine Environment Monitoring System (IMEM) Project Phase II, which was aimed at safeguarding the country's marine resources by monitoring illegal, unreported, and unregulated fishing activities.
He said that the government needed VMS transmitters to be installed in catcher vessels, and it was SRT that got the winning bid of P2,096,989,000 on Nov. 26, 2018. He added that the BFAR issued the Notice to Proceed on Dec. 4, 2018, with the term expiring on Dec. 4, 2022.
In his complaint, Victoriano said there were four payment tranches -- the first payment of P50 million was made in the first year, followed by P672,639,000 for the second year, P1,1113,924 for the third year, and finally P261,256,000 for the fourth year.
He cited in his complaint the 2019 audit of the Commission on Audit (COA), which flagged the BFAR for the payments made to SRT -- amounting to P738,124,000 as of Dec. 31, 2019 -- which were “not supported by complete documents.”
He alleged that SRT was not eligible to bid because of the Loan Agreement with France, which required bidders to either be a French national or with a joint venture with a French national.
SRT was not eligible, Victoriano alleged, because it is a British company. Despite this fact, he alleged that BFAR allowed SRT to join the bidding and even awarded the contract to the firm.
He said: "Due to the respondents’ intentional illegal acts, the said financing did not push through when they knowingly and intentionally violated the terms of the Loan Agreement and DA-BFAR’s own Invitation to Bid for the Project. Consequently, the project had to be funded locally and solely by the government, requiring it to allot bigger budget for the project."
He also complained of the service provider’s cost of satellite subscriptions required for tracking and electronic reporting system (ERS) information.
"SRT’s winning bid is proverbially a 'foot in the door' to a captive market with the assurance that future charges for software maintenance, network charges, satellite service subscriptions are guaranteed to it owing to the limited flexibility in replacing devices and satellite service providers," he alleged in his complaint.
"If the controversy as to whether DA-BFAR or the fishing operators shoulder the cost of satellite services past the project duration is not resolved, the project is projected to die a natural death as satellite service providers would naturally terminate or suspend the subscription for non-payment," he said.
“Worse, in the event that the cost to sustain the Project is passed on to the fishing operators, who are left with no choice but to continue with SRT’s system, the cost would have a direct impact on the cost of fishing operations, and eventually increase the price of the poor man’s fish...,” he alleged.
“These are all in clear contravention to the government’s policy of ensuring food security and the DA and BFAR’s mandate of protecting, conserving, and properly managing the country’s marine resources. These undeniably show DA-BFAR’s gross negligence in the performance of their duties,” he added.
Also in his complaint, Victoriano alleged what he called as "excessive" number of VMS ordered. He claimed that the BFAR required 5,000 units when it should only be 1,800 units.
"The excess 3,200 units undeniably represent an excessive purchase requirement and would necessarily increase the ABC (approved budget for the contract) for the project. The incremental cost of the excess VMS transponders would range between P250 million to P320 million, representing taxpayer’s contributions and government funds which could have been set aside for other important and pressing requirements," he alleged.
“Considering all the foregoing, it is clear that Public and Private Respondents should be held liable under Section 3(e) of R.A. No. 3019 for causing undue injury to the Government and for giving unwarranted benefits, advantage, and/or preference to SRT at the expense of the people’s taxes. DA-BFAR entered, on behalf of the Government, into a transaction with SRT that is manifestly and grossly disadvantageous to the government,” Victoriano also alleged in his complaint.