TWO high-ranking officials of the Department of National Defense (DND) are allegedly in cahoots with some officers of the Armed Forces of the Philippines (AFP) in “fixing” contracts for favored bidders, such as in the case of the questionable procurement of 21 refurbished UH-1D helicopters.
The Senate and the House of Representatives are set to
investigate the alleged anomaly where “witnesses” are expected to surface and
“tell all” about the deal that was sealed with Rice Aircraft Services Inc.
(RASI) and its partner, Eagle Copters Ltd.
According to DND insiders, the “duo” has been on top of
big-ticket and “juicy” contracts awarded to favored bidders, among them a local
supplier of defense materials, a woman with the initials “J.M.” Sources said
the trader has a number of retired and active officials in her payroll.
Last week, The Manila Times columnist and veteran broadcast
journalist Erwin Tulfo wrote about another questionable DND decision to
purchase 28 M113 armored personnel carriers (APCs) for P880 million instead of
shipping in 114 units of M113 donated by the United States.
It turned out, Tulfo said, that the 21 M113s bought from Israel , each of which costs at least P31.4
million, are APCs previously used in Belgium ,
the United States and Israel
“In my Teleradyo 5 interview with Defense Undersecretary
[Fernando] Manalo, he could not justify the DND’s decision to purchase 28 M113
APCs from Israel instead of
spending less on transporting the 114 APCs from the US
The Manila Times sources provided several documents and
photos to back up their claim that the helicopter contract was “rigged” in
favor of RASI, owned and operated by US businessman Robert Rice.
They said biddings were declared a failure to pave the way
for a negotiated contract in favor of RASI.
Documents obtained by The Times showed that ranking
Philippine Air Force officers “guided” the contractor on how to skirt strict
rules on government procurement, which allows a negotiated deal after two
successive failed biddings.
To make the “drama” more convincing, the bidding for the 21
helicopters failed not only twice but thrice and on all occasions, RASI emerged
as the winner, only to be disqualified eventually because of a number of
“irregularities.”
The quickest and surefire way to bag the deal was to declare
a failure of bidding to relax the requirements for negotiation.
Interestingly, a bidder should have been declared
blacklisted if it was found out that it faked its requirements or lacked the
required facility and financial capacity as in the case of RASI.
The documents showed that there were two Post Qualification
(PQ) inspections conducted at the facility of Rice. The first was on March 1-8,
2013 by PAF Brig. Gen. Conrado Parra and Maj. Oliver Casuncad.
The two officials gave a very impressive Post Qualification
report but failed to satisfy government observers during deliberations on their
mission.
They found out from the first PQ that Rice has no qualified
facility and some of his documents were fake. The helicopter components were
discovered to be non-compliant with the requirements from the start but the
official report was favorable.
The second PQ inspection was conducted by on April 23-27,
2013 at Rice facility again by Parra and Casuncad, accompanied by two more PAF
officers whose findings differed from the findings of the first two officers.
The documents again showed that there were papers found to
be fraudulent but were kept away from view allegedly upon the instruction of
the two ranking DND officials. The favorable report was to avoid the
blacklisting of Rice.
Sources said Assistant Secretary Patrick Velez was informed
that the documents submitted by Rice–statement of ongoing contracts, whereby
contracts stated therein did not actually exist; audited financial statements;
and net financial contracting capacity– were fraudulent.
As a part of PQ procedure, Rice had to present all the
original documents and the individuals who signed them. In the audited
financial statements, Rice failed to present the Certified Public Accountant
who certified the report.
“They never mentioned the fake documents submitted by Rice.
This is relevant to the discussions between the PAF official and Rice’s former
representative on how to manipulate the bidding to arrive at negotiation. Velez
knew that the papers were fake but the DND resolution turned out favorable.
Rice should have been blacklisted on the second bidding,” one of The Times
sources said.
The Manila Times was given what seems to be a copy of an
authentic mail envelope addressed to Rice that contained a copy of a resolution
passed by the DND Special Bids and Awards Committee (SBAC) 1.
The resolution states that there were failed biddings and
that it was highly recommended that “Secretary of National Defense (Voltaire
Gazmin) to resort to the adoption of an Alternative Mode of Procurement through
Negotiated Procurement.”
Stating causes for the recommendation, it was dated May 13,
2013 and signed by Undersecretary Fernando Manalo as chairman; Velez, as vice
chairman; Director Nebuchadnezzar Alejandrino as member; and Army Col. Joselito
Reyes as member.
The other members of SBAC 1 who failed to sign the
resolution were Lt. Gen. Gregorio Macapagal and Maj. Gen. Gabriel Dimatatac.
A copy of the resolution was given to Rice, proof that he
was being informed to prepare to bag the contract under a negotiated scheme,
the sources said.
Rice, by his own admission through a lawsuit in the US
The Times sources said these “economic relationships” were
the beginning of his “partnership” with Philippine officials.
http://www.manilatimes.net/defense-military-officials-control-juicy-contracts/171980/
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