The Philippine business community is in synch with other sectors of Filipino society in condemning those responsible for the trillion-peso flood control projects scandal. Many industry groups, including the Financial Executives Institute of the Philippines, have expressed their outrage and disgust over the alleged misuse of public funds. They are demanding quick government action to hold the perpetrators accountable and to recover the stolen money.

Another traditionally reserved organization, the Federation of Filipino-Chinese Chambers of Commerce and Industry Inc. (FFCCCII), has joined the fray. In a strongly-worded manifesto released last week, FFCCCII urged the government and the private sector to “resolutely confront the cancer of corruption eroding our nation’s foundation” and go beyond mere rhetoric by undertaking profound institutional changes to eradicate graft.

All of these developments began when President Ferdinand Marcos Jr. brought the issue to the forefront during his fourth annual State of the Nation Address (SONA) on July 28. He publicly acknowledged that many flood control projects were substandard or even ghost projects. Since then, the executive branch has acted swiftly in its anti-corruption drive.

Immediately after the 2025 SONA, Marcos ordered the Department of Public Works and Highways (DPWH) to submit a comprehensive list of all flood control projects undertaken over the past three years for review and audit. The DPWH is at the center of the controversy, along with the top 15 private contractors that have cornered almost ₱100 billion, or approximately 20 percent of the total flood control budget, from mid-2022 to mid-2025.

Marcos accepted the resignation of DPWH Secretary Manuel Bonoan last Aug. 31 and replaced him with former Transportation Secretary Vince Dizon, who was mandated to conduct a massive revamp of the corruption-plagued agency. Dizon has dismissed and perpetually banned several DPWH officials from public office.

Among the private contractors, nine firms owned by the husband-and-wife team of Curlee and Sarah Discaya have been flagged for securing billions of pesos in flood control contracts. The Bureau of Customs (BOC) raided the Discaya compound, which yielded 30 luxury vehicles worth billions of pesos, now in the BOC’s custody.

Bulacan received the largest share of flood control funding in Central Luzon, making it a prime target for a fraud audit after public complaints were filed via the “Sumbong sa Pangulo” website, created at Marcos’ orders. On two occasions last month, Marcos inspected several uncompleted river protection projects in the municipalities of Calumpit and Baliwag, where he found out that no work had been done and no materials were on site.

Other government agencies have also responded. The Anti-Money Laundering Council (AMLC) froze the bank accounts and other assets of individuals linked to anomalous flood control projects. The AMLC is set to file more petitions for a freeze order in the coming weeks. For its part, the Bangko Sentral ng Pilipinas tightened its rules on large cash withdrawals, limiting such transactions to ₱500,000 per banking day, to reduce money laundering and other risks associated with the use of cash.

Trade Secretary Cristina Roque placed the Construction Industry Authority of the Philippines (CIAP) and the Philippine Contractors Accreditation Board (PCAB) under her direct supervision. She appointed new executive directors for both the CIAP and the PCAB to ensure the continuity of operations while a full overhaul is underway.

Immigration lookout bulletin orders have been issued by the Department of Justice, including a list of 61 DPWH officials and contractors linked to the scandal, while the Office of the Ombudsman directed the six-month preventive suspension of 16 personnel from the DPWH’s Bulacan 1st District Engineering Office. The National Bureau of Investigation is conducting fact-finding investigations in various regions, ensuring case build-ups for possible criminal complaints after uncovering evidence of bid-rigging by some of the top contractors.

All eyes are now on the Independent Commission on Infrastructure (ICI) established by Marcos through Executive Order No. 94. The ICI is composed of retired Supreme Court Justice Andres Reyes Jr. as chairperson, with former DPWH Secretary Rogelio Singson and SGV Country Managing Partner Rossana Fajardo as members. Baguio City Mayor Benjamin Magalong has been named as ICI special adviser.

According to Marcos, no one will be spared in the ICI’s investigations, including his first cousin, former House Speaker Martin Romualdez, and other allies. In a press briefing last Sept. 22, Presidential Communications Office Undersecretary Claire Castro said Marcos himself is open to being investigated by the ICI.

Systemic reforms must therefore be implemented to prevent such corruption from happening again. Mandatory asset disclosures and bank secrecy waivers should be imposed on public officials to promote transparency. The business community has warned that this scandal could damage investor confidence and tarnish the Philippines’ reputation internationally – unless drastic measures are taken.