MANILA, Philippines—Stradcom Corp., the information technology service provider of the Land Transportation Office, is disputing the findings of the Commission on Audit that it used the government agency’s database without authorization.
In a statement, Stradcom said the COA’s findings contained in its 2010 report on the LTO were “patently false.”
The COA report stated that Stradcom earned P2 billion from its interconnectivity deals with other agencies using the LTO database without authority. LTO did not get a cut from Stradcom’s earnings from these projects, either, the audit agency added.
Stradcom President Cezar Quiambao contended that the LTO had mandated Stradcom to open the LTO database for interconnectivity with other government agencies.
Quiambao said COA could have been given malicious information by those who wanted Stradcom’s contract with LTO, in order to sabotage the company.
“Stradcom has always operated legally, and has always been fair to the government and considerate of the public. In fact it was LTO that asked Stradcom to allow other government agencies to connect to the LTO database,” Quiambao said in the statement.
According to Stradcom spokesperson Margaux Salcedo, the LTO and the Department of Transportation and Communication had even issued various circulars and department orders directing the opening of the LTO database for interconnectivity.
These interconnectivity projects helped the national government earn billions, Salcedo said.
She said that before these interconnectivity projects were in place, 65 percent of registered motor vehicles did not go through emission testing, and over half of registered vehicles did not have the compulsory third-party liability insurance coverage.
She said that not all apprehended drivers settled their cases before the interconnectivity projects were implemented. The government was also losing potential earnings because for-hire vehicles had unconfirmed franchises, but the situation changed because of the interconnectivity projects.
With these improvements, the government earns additional revenue through respective taxes, Salcedo said.
“On the issuance of fake insurance policies alone, Stradcom’s interconnectivity facility has ensured the authenticity of over P 3 billion annually in insurance premiums for which government would have otherwise lost tax revenues due to unscrupulous practices of fake insurance agents,” she said.
The public also benefits because they are no longer prey to fake agents who leave them hanging in their time of need, she added.
Stradcom corporate secretary Eric Pineda also said in the statement that while the company had helped the LTO, the latter still owes it P1.96 billion.
In its 2010 report, the COA recommended that the LTO review the agreements between Stradcom and other agencies related to inteconnectivity fees, especially since the LTO’s consent was not sought before these deals were executed, and the LTO was not included in the agreements even though its own database was used.
The LTO should also take legal action against the agreements dealing with interconnectivity to determine their propriety and to establish the legal basis for imposing interconnectivity fees, the COA said.
The COA report said computer fees were collected from license applicants and vehicle registrants even though their transactions were manually processed. Of the P340.719 million collected, P266.093 million had been paid to Stradcom while the remaining P74.625 million remained in escrow.
The audit agency said the amount paid to Stradcom should be recovered.