Ombudsman suspends LTFRB, OTC chiefs over LTO P13-B fee mess

MANILA, Philippines — The Office of the Ombudsman on Tuesday announced the preventive suspension of Land Transportation Franchising and Regulatory Board (LTFRB) chief Vigor Mendoza II and Office of Transportation Cooperative (OTC) chairman Teofilo Guadiz III over a move during both of their stint as former Land Transportation Office (LTO) chiefs which, according to state auditors, caused over P13 billion in additional fees to the public.

Assistant Ombudsman Mico Clavano said the Aug. 17 suspension of Mendoza and Guadiz over the continued use of the Stradcom-operated LTO information technology system despite the implementation and acceptance of its replacement, the Land Transportation Management System (LTMS).

“Then LTO chief Guadiz, and later Mendoza, both pushed for the use of the Stradcom IT system with the LTMS,”  Clavano said in a press conference.

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READ: Current, ex-transport execs face graft rap over LTO ‘computer fees’

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Citing the findings of the Commission on Audit, Clavano said the additional fees amounted to a total of  ₱13.3 billion in computer fees from 2019 to 2025. 

According to Clavano, COA said it caused “an additional burden and expense for the transacting public.”

“The Ombudsman found sufficient grounds for their preventive suspension, citing strong evidence showing their guilt,” Clavano said.

However, Clavano said the preventive suspension is “intended not as a penalty but to preserve documents and evidence and prevent possible further malfeasance or misfeasance in office.”

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Mendoza and Guadiz said they fully respect the Office of the Ombudsman’s suspension order. 

“I have yet to see the copy of the official order and once received, this will serve as the basis to reiterate my position, and present evidence-backed legal arguments that all my actions when I was still the LTO chief were all for the protection and interest of not only the motorists but also the Filipino people,” Mendoza said in a statement. “This will be a good opportunity for me to prove it, and eventually clear my name, in the proper forum.”

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Guadiz also said he has yet to receive a copy of the order.

“Upon receipt, I will carefully review its contents and, in consultation with my counsel, take the appropriate legal steps to protect my rights and formally address the allegations,” Guadiz said.

“I remain confident that the evidence and the official records will show that the actions I took during my tenure as Chief of the Land Transportation Office were lawful, undertaken in good faith, and guided by my duty to serve the public interest,” he continued. “I welcome the opportunity to present my side, clarify the circumstances, and establish the facts through the proper legal process. I have full faith that, in due course, the truth will prevail and my name will be cleared.”

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In 1998, the then-Department of Transportation and Communication (DOTC) and Stradcom entered into a build-own-operate agreement which covered the establishment and operation of computer systems and other infrastructure used to process LTO transactions nationwide.

Then, a final certificate of acceptance was issued by the DOTC, now the Department of Transportation, to Stradcom in February 2003. This original 10-year concession period expired on Feb. 10, 2013 and was subsequently extended on a month-to-month basis.

In 2016, the LTO and Stradcom entered into a phaseout agreement allowing the arrangement to continue while the LTO had no new or replacement IT system that was fully operational nationwide.

In 2018, the government contracted a joint venture led by Dermalog Identification Systems for the creation of LTMS.

The LTMS was institutionalized as the government’s principal platform for motor vehicle registration, licensing and related transportation transactions, with LTO operations directed to gradually transition away from the Stradcom-operated system.

However, during Guadiz’s term in 2022, he “favored Stradcom,” with him saying “the old IT System provides a better solution,” according to the Ombudsman order.

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And in 2023, the order noted that Mendoza issued several memoranda “effectively reviving and institutionalizing the continued use of the LTO IT System through a parallel utilization alongside the LTMS.” /das