GGRAsia – Pagcor ends contract with POGO auditor, flags legal action

Pagcor ends contract with POGO auditor, flags legal action

Mar 10, 2023 Newsdesk Latest News, Philippines, Top of the deck

The Philippine Amusement and Gaming Corp (Pagcor) says it has terminated the contract with a third-party auditor responsible for auditing the Philippine Offshore Gaming Operators (POGOs). Global ComRCI was found to be “in default of its obligations” and to “have committed unlawful acts,” said the country’s gaming regulator in a statement on Thursday.

Pagcor issued a notice to terminate the contract with Global ComRCI six months after it started a review of the consortium’s contract. The 10-year contract had been signed in December 2017, by then Pagcor chairman and chief executive Andrea Domingo. The regulator said at the time that Global ComRCI had the “technical and professional expertise required by Pagcor, and was able to comply with all the requirements of the public bidding”.

Pagcor’s decision to junk the contract comes two months after senators grilled the state-run corporation over the credentials of Global ComRCI. It then came to light that no financial institution had issued a bank certification for the auditing company, and that Global ComRCI was remiss in paying taxes.

Pagcor stated that the contract with Global ComRCI had been under review since September last year, following the change in leadership at the regulator.

In its Thursday statement, Pagcor said that in accordance with the “Government Procurement Act”, it had issued a notice to terminate the contract with Global ComRCI.

“Upon careful evaluation, Pagcor has determined the third-party auditor to be in default of its obligations and prima facie evidence to have committed unlawful acts,” it stated.

The regulator also said it had “endorsed the matter to the Office of the Solicitor General for the possible filing of administrative, civil and criminal cases against Global ComRCI”.

Pagcor flagged that it would “explore all legal remedies available” for the restitution of more than PHP800 million (US$14.5 million) “out of the partial amount released to Global ComRCI prior to the assumption of the current administration”. It would also seek compensatory damages, it added.

Pagcor stated that it would “temporarily” undertake auditing functions for the country’s POGOs, “until it is able to contract another third-party auditor through a transparent and strict bidding process.”

The regulator also disputed allegations that it had paid a total amount of PHP6 billion to Global ComRCI. “No payment has been made by Pagcor in the past four years due to the shortfall from the minimum revenue stipulated in the contract,” it added.