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Bacolod City, Philippines Thursday, January 20, 2011
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Ombudsman to proceed
with former mayor’s case

The Office of the Ombudsman (Visayas) has found enough basis to proceed with the preliminary investigation of the Anti-Graft and Corrupt Practices Act complaint filed against former Murcia Mayor Esteban Coscolluela and Julieta Cunanan, president of the Systems and Plan Integrator Development Corp.

Deputy Ombudsman for the Visayas Pelagio Apostol has ordered Coscolluela and Cunanan  to file their counter affidavits and controverting evidence  to the criminal complaint filed against them by  Murcia Mayor Andrew Montelibano, in connection  with a P16.8 million  computerization project in Murcia, Rayfrando Diaz, counsel of the Montelibano, said yesterday.

A motion to dismiss, motion for bill of particulars and similar dilatory motions are prohibited pleadings and will accordingly be stricken off the records of the case, Apostol said in his order.

Montelibano, in his criminal complaint, said Coscolluela in 2009 applied for a P16.8 million loan with the Land Bank of the Philippines  to finance the computerization project of Murcia.

Unknown to LBP, the project was not listed as a priority program under the Medium Term Development Plan  and the  Annual Investment Plan or Murcia for 2009 by the Municipal Development Council, the complaint said.

On Oct. 28, 2009 Coscolluela asked the SP  to approve the loan agreement between LBP and Murcia  under the MTDP and AIP , which they did, the complaint added.


Coscolluela did not disclose to the SB members  that the computerization project  was not included in the MTDP and AIP for 2009, Montelibano said.

On Nov. 12, 2009, on the initiative of Coscolluela, the Murcia SP enacted Appropriation Ordinance No. 6, Series of 2009, allocating P16.8 million as capital outlay under a Special Purpose Appropriation and it stated that the source of fund was “borrowings”.

When he submitted Supplemental Budget No. 4 to the SP for approval, Coscolluela did not disclose to the SP members  that there was no loan agreement entered  into by Murcia and the LBP yet.

The loan agreement between LBP and Murcia was signed on Nov. 16.


The complaint said SPIDC has no patent over the applications software that it was offering to Murcia; and its choice as supplier  should have been done through competitive public bidding.

What is clear is that Coscolluela took  advantage  of his public office  and pre-arranged a contract with SPIDC  that resulted to the damage  and prejudice of Murcia, the complaint said

The deliberate haste  in which the loan facility and the procurement of the project were obtained and executed, as well as the clearly intentional violations and wanton disregard of several provisions of the Local Government Code and Procurement Reform Act  by Coscolluela clearly show  his manifest partiality for SPIDC, it added.


The contract entered into by Coscolluela and SPIDC was clearly for a consideration that was excessive, exorbitant and overpriced to the advantage of SPIDC and the disadvantage of the municipality of Murcia, Montelibano added.

Montelibano said that, immediately upon his assumption as mayor of Murcia, and without any action on his part, Cunanan made representations to offer a discount of P1.47 million for the project.

“This offered discount clearly shows that the consideration of the contract was overpriced and Murcia could have obtained the project at a more reasonable price,” Montelibano said.


Coscolluela, when asked for his reaction to the finding of enough basis by the Ombudsman’s to proceed with the preliminary investigation on the matter, said it is part of Montelibano’s game plan to try to discredit and malign him, which  is his only accomplishment to date.

The case will not prosper because Montelibano is not divulging all the facts, no one complained when the project was implemented, the former mayor said.

It is simple harassment, he said, noting that that SPIDC  had also supplied similar projects to Silay, Talisay and Bago cities.

Not a single centavo from Murcia has been paid for the project nor has the loan with LBP been consummated, Coscolluela added.

Montelibano said SPIDC started bringing in the supplies for the computerization project in Murcia even before LBP approved the loan of the town and paid it.

But, Montelibano said that even before he joined politics, there were already complaints over the Murcia computerization project.


He said that when he became mayor, he stopped the project because of questions of overpricing and non-compliance with loan requirements. He also noted that the LBP did not release the loan Coscolluela sought.

Filing the case against Coscolluela was not for political reasons but to protect the interests of his constituents, Montelibano added.

He also pointed out that the Ombudsman  has found that there is enough basis to proceed with the preliminary investigation proceedings.*CPG




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