The Office of the Ombudsman’s Special Panel of Investigators (SPI) has formally accused former House Speaker Martin Romualdez and former Ako Bicol Party-list Representative Zaldy Co of orchestrating a massive ₱56-billion corruption scheme involving national flood control funds.
In a complaint currently undergoing preliminary investigation, the anti-graft panel recommended that the two former lawmakers face charges of plunder, direct and indirect bribery, money laundering, and violations of the Anti-Graft and Corrupt Practices Act. The SPI characterized the operation as a highly organized setup designed to subvert the national budget process for personal gain.
“This opportunistic corruption was carried out with a brazenness that speaks not only of immense greed, but of a complete disregard for consequence,” the Ombudsman panel said.
According to the investigation, Romualdez and Co maintained a strict division of labor to run the operation. Romualdez allegedly wielded executive control over project selection, budget allocations, and the collection of commissions, while Co managed the operational maneuvers within the congressional budget deliberations.
“These coordinated acts are not isolated or coincidental. Rather, they reveal a synchronized and interdependent operation: Romualdez provided the authority, direction, and ultimate control, while Co executed the operational aspects of the scheme within the budget process and facilitated the collection and delivery of illicit proceeds,” the panel said.
The SPI based its findings heavily on video admissions from Co and corroborating affidavits from former Philippine Marines personnel, including Senate witness Orly Guteza, Christopher Esquivel, and Gil Natividad Jr.
Co previously claimed he was ordered to amass a monthly quota of ₱2 billion in kickbacks from Department of Public Works and Highways (DPWH) projects, which were initially dropped off at a residence on McKinley Drive in Forbes Park, Makati City. As the volume of cash grew, Romualdez allegedly ordered the deliveries redirected to another Forbes Park property at 30 Tamarind Street.
Guteza and the other former employees confirmed regularly transporting suitcases of cash between the properties. The Ombudsman panel defended the credibility of these witnesses, stating their accounts showed no signs of ulterior motives.
“To disregard the testimonies of those who had direct participation in, or personal knowledge of, the scheme on this basis alone would be to accord impunity to precisely those offenses most carefully engineered to avoid trace,” it added.
The complaint also implicated businessman Jose Raulito Paras, an Upsilon Sigma Phi fraternity brother of Romualdez, as a central figure in a money laundering and dummy arrangement.
Paras allegedly used Golden Pheasant Holdings Corporation to purchase the Tamarind Street property to conceal the illicit funds. Investigators noted that while the holding firm possessed billions of pesos in real estate assets, it lacked actual operating income and had minimal paid-up capital.
To further establish the connection, the SPI highlighted a financial anomaly regarding a $2 million donation publicly credited to Romualdez for Harvard University.
Confidential financial records revealed that no such funds left Romualdez’s personal accounts; instead, Paras transferred ₱109.865 million to the institution. Senate testimonies from former tenants of the Tamarind Street house further supported the panel’s conclusion that Paras acted as Romualdez’s nominee.
“This conclusion is reinforced by his relationship with Romualdez, which reveals circumstances indicative of a nominee or dummy arrangement in relation to the transaction,” the SPI said.
Following the SPI’s complaint, the Sandiganbayan anti-graft court issued a precautionary hold departure order against the former House Speaker.
Romualdez has vehemently denied the accusations, asserting that he is being used as a scapegoat for the corruption of others.
He argued that Co and former Senate President Francis “Chiz” Escudero were the primary figures directing the 2025 national budget allocations, noting that he was excluded from the small committee that finalized the General Appropriations Bill.
“If this is a political play to push me out and close the story, tarnishing my name and my reputation, then I am telling everyone now, I will not go quietly, and I will not go alone,” the former House leader said in an earlier statement.