Ombudsman dismisses plunder, malversation raps vs Recto over PhilHealth funds

MANILA, Philippines (Updated 6:47 p.m.) — The Office of the Ombudsman has dismissed the complaints against Executive Secretary Ralph Recto and several others in connection with the transfer of reserve funds of the Philippine Health Insurance Corp. (PhilHealth) to the national treasury.

In a consolidated resolution dated June 2, 2026, the anti-graft body ruled that there was a lack of prima facie evidence to indict the officials for technical malversation, plunder and violations of the Anti-Graft and Corrupt Practices Act.

The case stemmed from the transfer of PhilHealth's excess reserve funds, which complainants alleged was an illegal use of public money that risked the country's healthcare program. The Supreme Court ordered the return of the funds on Dec. 3, 2025.

The transfer was executed following Department of Finance (DOF) Circular No. 003-2024, when Recto was still finance secretary, to implement a special provision in the 2024 General Appropriations Act (GAA) regarding the use of unprogrammed appropriations.

In its resolution, the Ombudsman found that Recto's actions were undertaken in good faith and were "incidental" to his ministerial duty to comply with a legislative mandate.

The Ombudsman emphasized that criminal liability for technical malversation requires proof of intent to perpetrate a prohibited act, which the complainants failed to establish with reasonable certainty.

"The DOF Circular No. 003-2024 attached to the Taton et al. complaint, which is the only evidence provided by the complainants, is insufficient to prove respondents' intent to perpetrate the offense considering that the act of issuing the said circular is not illegal having been done within the authority and functions of DOF Secretary Recto," the Ombudsman's resolution read.

Furthermore, the Ombudsman also dismissed the plunder charges, stating there was no evidence that any portion of the P60 billion was used for personal enrichment by the respondents.

The anti-graft body pointed out that for a charge of plunder to prosper, there must be proof of amassing ill-gotten wealth, an element that was clearly absent in this case.

"Thus, the return of the PhP60 billion to PhilHealth militates against the allegation that respondents took advantage of their positions for 'personal enrichment,'" the Ombudsman's resolution read.

Regarding the administrative aspect, the Ombudsman dismissed the complaint for grave misconduct against Recto also due to insufficiency of evidence.

The administrative complaint against Ledesma was also dismissed on the grounds of lack of jurisdiction, as he had already separated from government service by the time the complaints were filed in March 2026.

Philstar.com has reached out to Recto for comment on the dismissal of the complaint against him, but he has yet to reply.

Several individuals and groups have also filed complaints against Recto before the Ombudsman, also in connection with the transfer of PhilHealth funds.