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Press Release

Ex-DSWD Secretary, Cotobato lawmaker charged for P9M PDAF scam
04 January 2017

      Former 2nd district North Cotobato representative Gregorio Ipong is facing a second set of charges for his involvement in the Priority Development Assistance Fund (PDAF) scam. In a 32-page Resolution, Ombudsman Conchita Carpio Morales ordered the filing of two counts of violation of Section 3(e) of the Anti-Graft and Corrupt Practices Act (Republic Act No. 3019), one count each of Malversation and Malversation thru Falsification of Public Funds, against Ipong and former Department of Social Welfare and Development (DSWD) Secretary Esperanza Cabral.

      Also charged before the Sandiganbayan are DSWD Undersecretary Mateo Montaño, Chief Accountant Leonila Hayahay and Roberto Solon of the Economic and Social Cooperation for Local Development Foundation, Inc. (ECOSOC).

      Ipong, currently the Vice-Governor of Cotobato, was found responsible for the anomalous utilization of his P9.4million PDAF issued thru a Special Release Allotment Order in January 2007. The fund was supposed to target the poor and marginalized sectors of Ipong’s constituents in the 2nd district thru medical missions, health materials and various medicines worth P400,000.00; and capacity building/livelihood capital assistance for 75 marginal families in extremely difficult circumstances pegged at P9million, or P120,000 per family.

      Ombudsman field investigators found that Ipong instructed that the fund be downloaded to the DSWD, as implementing agency, thru the ECOSOC, as NGO-partner. Actual on-site field verification conducted by the Ombudsman reveal that “a majority of the supposed beneficiaries denied receipt of the purported assistance.” Certifications and affidavits from city, municipal and barangay officials were obtained by the Ombudsman to prove that the PDAF was used to fund Ipong’s “ghost projects.”

      Key documents were obtained showing the absence of due diligence audit of the NGO as ECOSOC was financially incapable of implementing multi-million peso projects due to its measly capital of only P56,000.00. Respondents also failed to comply with the requirement of public bidding as explicitly required under the Government Procurement Reform Act.

      Medicine supplier, Ace Pharmaceuticals, denied engaging in any business transaction with ECOSOC relative to the supply of medicines. The Board of Trustees of ECOSOC also denied any knowledge of the transactions entered into by ECOSOC with DSWD. The NGO issued a letter to the Commission on Audit stating that “the persons involved must have used their NGO for their own personal and unauthorized purpose.” The Resolution also pointed that “Cabral, as then DSWD Secretary, prepared, reviewed and entered into the Memorandum of Agreement governing the implementation of the projects.”

      According to Ombudsman Morales, “instead of using the PDAF disbursements received by them to implement the livelihood projects, respondents diverted these sums amounting to P9.4 million to their own pockets.”

      “The role played by each of them was so indispensable to the success of their scheme that, without any of them, the same would have failed,” added Morales.

      In the related administrative case, the Ombudsman also found Ipong and Montaño guilty of Grave Misconduct, ordering their dismissal from the service and perpetual disqualification from holding public office with forfeiture of all retirement benefits. In case of separation from the service, the penalty is convertible to a fine equivalent to respondents’ salary for one year.

      Earlier in October, the Ombudsman found Ipong also liable for the misuse of his P10million 2007 PDAF coursed thru the Aaron Foundation, Inc. He was charged with violation of Section 3(e) of R.A. No. 3019 and Malversation. ###