Press Release
February 3, 2006

Drilon dares Ombudsman to file graft charges versus execs in fertilizer scam

Senate President and Liberal Party head Franklin Drilon today challenged the Office of the Ombudsman to initiate its own investigation and file graft charges against Department of Agriculture (DA) and local government officials involved in the P728-million fertilizer scam.

In a statement, Drilon asked Ombudsman Merceditas Gutierrez to start her own investigation on the anomaly, saying that documents and testimonial evidence gathered by an ongoing Senate congressional investigation can be made available to government anti-graft prosecutors for scrutiny and evaluation.

The Senate President made the call after government auditors confirmed on Thursday that the fertilizer used in the Ginintuang Masaganang Ani (GMA) program was overpriced by at least P127 million.

The DA fund was reportedly managed by controversial former DA undersecretary Jocelyn "Jocjoc" Bolante, the alleged chief architect of the fertilizer fund program and a close associate of First Gentleman Mike Arroyo.

The opposition claimed the Arroyo administration allegedly diverted the fertilizer funds to ensure the victory of President Arroyo in the May 2004 elections. Documents from the COA showed that more than 100 House of Representatives members, 53 governors and 26 town mayors received between P3 million and P10 million each in fertilizer funds from the DA shortly before the May 2004 elections.

During the Senate hearing Thursday, the Commission on Audit (COA) confirmed that the overpricing was noted specifically in the P97-million fund for the purchase of fertilizers from suppliers and the P160-million budget allocated for non-government organizations and peoples organizations.

"Considering the gravity of this mind-boggling corruption scheme and the reckless paper trail it left behind for everyone to see, I think it is now incumbent upon the Office of the Ombudsman to take over this case," Drilon said. "The evidence is overwhelming. The COA itself said there was massive overpricing of fertilizer at the expense of our poor and starving farmers."

Drilon said he was confident the Office of the Ombudsman would prosecute those responsible for pulling off the fertilizer scam. "I remember that when Ombudsman Gutierrez assumed office, she vowed that she will spare no one in the campaign against corruption in government. I am confident she will be true to her word," Drilon noted.

During the hearing, a broker also exposed an alleged conspiracy between DA officials and local politicians to skim off the fund for liquid fertilizer. Witness Jose Barredo Jr. said he met with congressmen, governors and mayors in their homes to persuade them to avail themselves of the DA fund by dangling an offer -- a 30-percent commission.

Barredo said that between January and April 2004, he worked with one Maritess "Tess" Aytona, believed to be one of the owners of medical supplier Feshan Philippines Inc. and an "agent" of Bolante. He said it was Aytona who took care of getting the required papers signed, and having the necessary funds as well as the commissions released.

Citing a summary of the audit observation memorandum, COA auditor Flerida Jimenez said there was an overprice of P48.67 million from the purchases made from the P97-million fertilizer fund and P79.674 million from the P160-million NGO fund.

Jimenez told the Senate Committee on Food and Agriculture, chaired by Sen. Ramon Magsaysay, that P643 million of the P728-million fund allotted to the GMA project were allocated to the regional field units of the Department of Agriculture.

Malacañang , upon the request of Bolante, made available to the agriculture department a total of P2.8 billion, including P544 million that came from sequestered Marcos family assets which, under the law, should be used for agrarian reform. The funds were released between February and April last year.

Drilon explained that the Office of the Ombudsman need not wait for the Senate to finish its congressional probe on the fertilizer scam before conducting its own investigation on the matter. "It is the principal mandate of the Ombudsman to look into cases like this," Drilon said.

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