MANILA (UPDATED) – The Office of the Ombudsman has ordered the preventive suspension of Marikina Mayor Marcelino Teodoro and several Marikina City local government officials in relation to the alleged misallocation of P130 million funds for the Philippine Health Insurance Corporation. 

The order stemmed from the complaint filed by Marikina resident Sofronio Dulay last year, claiming the LGU's PhilHealth funds were appropriated to "various budgetary items" which were non-health items, contrary to Republic Act No. 11223 or the Universal Health Care Act. 

The complainant alleged the funds were allocated to IT equipment, repair and maintenance of infrastructure assets, and other supplies and materials.

 Dulay lodged a complaint for violation of Article 220 of the Revised Penal Code or technical malversation and violation of Section 3 (e) of the Anti-Graft and Corrupt Practices Act. He also filed an administrative case for grave misconduct and conduct prejudicial to the best interest of the service.

 Teodoro earlier maintained that the PhilHealth funds in question remain intact and are fully accounted for.

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In the 10-page order approved by Ombudsman Officer-in-Charge Dante Vargas, Teodoro and 18 other local officials were placed under preventive suspension without pay until the termination of the investigation, but must not exceed six months.

"The Office finds sufficient grounds to grant complainants' prayer for the issuance of an Order for Preventive Suspension against respondents…. Considering that there is strong evidence showing their guilt; the charges against them for Grave Misconduct and Conduct Prejudicial to the Best Interest of the Service may warrant their removal from the service; their continued stay in office may prejudice the investigation of the case filed against them; in order to preserve documents and evidence pertaining to this case which they have control and custody; and in order to avoid respondents' commission of further malfeasance and/or misfeasance in office," the order stated.

The Ombudsman OIC cited the Commission on Audit Fraud Audit Office (COA-FAO)'s Marikina City Special Health Fund Fraud Audit Report.

Key findings from the COA's SHF Fraud Audit include: 

    - Confirmation of Diversion - substantial amounts from the SHF were expended on items outside the intended scope of health programs with itemization of transactions funded by the PhilHealth reimbursements and matching them to the enabling Ordinance Nos. 066-2023 and 002-2024

    - Non-Compliance with Law - the expenditures lacked legal basis and flagging them as "irregular or unauthorized use of public funds"

    - Evidence of Misconduct - clear audit trail linking the decisions and approvals made by respondents resulting improper disbursements

"Clearly, there is no legal justification for the diversion of the SHF (Special Health Fund). The diverted expenditures were not emergencies related to health, nor transfers to another health program," the order stated.

It said the acts committed above fall under the crime of Technical Malversation.

"Clearly, the collective actions before, during and after the commission of the Technical Malversation show the implied conspiracy among respondents," it said.

"The SHF Fraud Audit provides an independent, authoritative verification of the exact fact in issue - whether PhilHealth-derived public funds were misapplied. Notably, respondents never disclosed that any such audit was in progress or made any interim findings available," the order added.

Aside from the Marikina Mayor, included in the suspension order are City Treasurer Nerissa Calvez San Miguel, City Accountant Erlinda Gutierrez Gonzales, Assistant City Budget Officer Rodriguez Nepomuceno, Sangguniang Panlungsod Secretary Noralyn Tingcungco and 14 members of the Sangguniang Panlungsod.

"In case of delay in the disposition of these cases due to the fault or negligence or any cause attributable to the respondents, the period of the delay shall not be counted in computing the period of the suspension in accordance with Sec. 9, Rule III of AO No. 7, as amended, and Sec. 24 of RA No. 6770," the order read.

"In accordance with Sec. 27 (1) of RA No. 6660, this Order is immediately executory. Notwithstanding any motion, appeal, or petition that may be filed by respondents seeking relief from this Order, unless otherwise ordered by this Office or any court of competent jurisdiction, the implementation of this Order shall not be interrupted within the period prescribed," it further stated.

'POLITICALLY MOTIVATED'

 In a statement on Tuesday, Teodoro reiterated his earlier claim that the preventive suspension is "politically motivated."

 "I strongly believe that the preventive suspension issued against me is politically motivated and part of a broader effort to derail my candidacy in the May 12, 2025, midterm election. I am a casualty of political persecution, plain and simple," he said.

 "In a desperate attempt to besmirch my name, they’ve filed numerous trumped-up charges against me before the Ombudsman, COA, Comelec, Civil Service, and other government agencies," Teodoro added.

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The Marikina mayor alleged the multiple complaints are "clearly part of a pattern of political harassment."

 He also questioned the timing of the order, which came out three days before the start of the local campaign period on March 28.

 Teodoro is running for Marikina 1st District representative, but the Commission on Elections 1st Division canceled his certificate of candidacy for material representation.

 "I REMAIN A CANDIDATE in the upcoming mid-term elections. I will NOT be intimidated," he said.

 "We are confident that we have a strong defense and will prove that these allegations have no basis or merit. We will face this head-on, with full transparency and accountability," Teodoro added. 

Comelec earlier said Teodoro's name will remain on the ballots until there is a final an executory ruling.

 With several Marikina LGU employees part of the suspension order, Teodoro assured they will continue their fight for good governance and a clean and honest service. 

"It’s unfortunate that City Hall will be left largely dysfunctional with the suspension of most city officials. I hope this won’t lead to any disruption in services for our residents," he said.

 "I urge everybody to remain calm as we will defend not just our name and reputation, but the progress we’ve worked and fought so hard to achieve together," Teodoro added.