Thread by @cnnphilippines

THREAD: The Senate Blue Ribbon Committee resumes its investigation into the management of COVID-19 pandemic response funds.

Updates by our correspondent @eimorpsantos and digital producers @pplmanuel & @kristellimpot

@eimorpsantos @pplmanuel @kristellimpot Senate Blue Ribbon Committee chairman Richard Gordon: Malinaw na malinaw ang unwarranted benefits, advantage, preference or favoritism na binigay sa Pharmally na meron lamang ₱625,000.

@eimorpsantos @pplmanuel @kristellimpot Sen. Gordon: This grand conspiracy could not have happened without the executive's imprimatur from beginning to end.

@eimorpsantos @pplmanuel @kristellimpot Sen. Gordon on President Rodrigo Duterte: Bakit imbis na pagtanggol ang bansang Pilipinong nahihirapan, ang pinagtatanggol eh mga kaibigan niyang banyaga?

@eimorpsantos @pplmanuel @kristellimpot Sen. Gordon gives a "shoutout" to internet trolls trying to discredit the probe: Sana po ay magbagong buhay na po kayo. Marami pong trabahong marangal.

@eimorpsantos @pplmanuel @kristellimpot Sen. Gordon takes a swipe at Duterte's weekly addresses: Talk to the Senators na po, di na Talk to the People. 'Yun na ang programa niya: sumasagot sa Blue Ribbon [committee].

@eimorpsantos @pplmanuel @kristellimpot Health reform advocate Dr. Tony Leachon says the COVID-19 response fund controversy, if proven, is the "worst corruption in the history of the Philippines."

@eimorpsantos @pplmanuel @kristellimpot Dr. Leachon: It happens in the pandemic involving the lead health agency and DBM in charge of saving us from this and accountable for huge funds for health workers, medical supplies.

https://twitter.com/cnnphilippines/status/1450309265252519936

@eimorpsantos @pplmanuel @kristellimpot The Senate Blue Ribbon committee invited several health leaders who signed the letter of indignation and call to action addressed to the government. cnn.ph/news/2021/10/1…

@eimorpsantos @pplmanuel @kristellimpot Philippine College of Physicians President Maricar Limpin: We decry any attempts to cover up what really happened. We call for transparency and accountability. In particular, I hope dumating ito sa President, not to obstruct any investigation.

@eimorpsantos @pplmanuel @kristellimpot Dr. Limpin: Para maalis ang pagdududa na maaaring may cover-up, we like to suggest that it's time to create an independent body that will investigate COVID-19 supplies purchases.

@eimorpsantos @pplmanuel @kristellimpot Sen. Gordon tells doctors: We hear you loud and clear. We will do this without any color of politics... We support your activism because it favors the right of the people to be heard.

@eimorpsantos @pplmanuel @kristellimpot Tax expert Mon Abrea on TigerPhil Marketing Corp: Nasa ₱3.5M lang ang sales na dineklara nila sa BIR. Ibig sabihin hindi nila dineklara ang sinupply nila sa Pharmally. Ito ay grounds for tax evasion dahil higit 30% ang under-declared.

@eimorpsantos @pplmanuel @kristellimpot TigerPhil President Albert Sy tells senators they paid an amended VAT return worth ₱553,800 and ₱1.138M in annual income tax return on Sept. 24.

Sen. Gordon points out it was in the midst of the Blue Ribbon inquiry. Sy confirms.

@eimorpsantos @pplmanuel @kristellimpot Sen. Gordon: Noong lumabas, dali-dali kayong nagbayad at amend. May pakinabang pala ang Blue Ribbon committee. Napilitan kayong magbayad nang totoo.

https://twitter.com/cnnphilippines/status/1450322545136128005

@eimorpsantos @pplmanuel @kristellimpot TigerPhil President Albert Sy says his firm dealt with a "Mr. Tsai" to purchase face masks. When pressed, he says he doesn't know the details nor first name of the person.

@eimorpsantos @pplmanuel @kristellimpot Greentrends supplied face masks to TigerPhil, which then sold these to the country's top medical supplier Pharmally Pharmaceutical Corporation. bit.ly/3aRpUB2

@eimorpsantos @pplmanuel @kristellimpot Sen. Gordon to TigerPhil President Sy: Meron ka nang marka, kaya i-correct mo na yan. Tumulong ka na. Kaya mo ba tumulong o gusto mo ikaw managot sa lahat ng kasinungalingang nangyayari?

@eimorpsantos @pplmanuel @kristellimpot Sen. Gordon points out that TigerPhil President Sy was looking at someone else while he was delivering his answer.

@eimorpsantos @pplmanuel @kristellimpot Sen. Gordon: Alam mo na hindi kayo nagbayad ng correct taxes, ng VAT?

TigerPhil Director Qingjin Ke: Yes, but we have also made an amendment.

@eimorpsantos @pplmanuel @kristellimpot Sen. Gordon: So there was a deliberate effort to avoid taxes, nung nahuli kayo sa Blue Ribbon, nagbayad kayo. Correct?

@eimorpsantos @pplmanuel @kristellimpot TigerPhil's Qingjin Ke: We are a legitimate company in the PH, so we will definitely pay the taxes...I apologize for this mistake, but it was really not our intention.

https://twitter.com/cnnphilippines/status/1450332534877790209

@eimorpsantos @pplmanuel @kristellimpot Abrea explains due diligence: Kahit sa anong pagkakataon, emergency man o hindi, dapat may pag-iingat po lalo na't taxpayers' money ang ginagamit dito sa pinagu-usapan.

@eimorpsantos @pplmanuel @kristellimpot Sen. Gordon asks the Blue Ribbon Committee's director-general to prepare a letter informing the Immigration Committee that charges should be filed against Chinese nationals in PH who do not pay their taxes.

@eimorpsantos @pplmanuel @kristellimpot TigerPhil's Qingjin Ke once again apologizes, adding it was because of the pandemic that they were not able to pay the taxes.

https://twitter.com/cnnphilippines/status/1450334995910774792

@eimorpsantos @pplmanuel @kristellimpot Abrea on Pharmally's submission of documents: Wala pa rin po ang subsidiary ledgers ng cash transaction pagdating sa paano sila binayaran, pano sila nagbayad sa suppliers.

@eimorpsantos @pplmanuel @kristellimpot Abrea: Kahit paulit-ulit natin tanungin ang mga involved, kung di natin makikita ang source documents, ang missing link natin yung ₱7.2 billion purchases, Totoo ba ito? Nasaan ang dokumentong nagsasabi? Sino nagsupply?

@eimorpsantos @pplmanuel @kristellimpot Abrea on fulfilling tax obligations: Hindi pwede maging excuse ang pandemya dahil online lahat ng transaksyon sa BIR.

@eimorpsantos @pplmanuel @kristellimpot Auditor Iluminada Sebial, who was paid ₱4,000 to audit Pharmally's multi-billion financial statement: Chineck ko lang po pero hindi ako nakakuha ng mga dokumento (supporting documents). Sabi po papadalhan nalang nila ako. Ngayon nag-investigation, hindi na ako nabigyan ng kopya

@eimorpsantos @pplmanuel @kristellimpot Sen. Pangilinan says Pharmally's refusal to submit some documents "can be likened to a refusal to answer, and therefore is contemptible behavior" and may warrant detainment.

@eimorpsantos @pplmanuel @kristellimpot Sen. Gordon: We try to avoid that as last resort...but I'm just the chairman here, and I would entertain any motion to that effect.

https://twitter.com/cnnphilippines/status/1450340564298186752

@eimorpsantos @pplmanuel @kristellimpot Pharmally treasurer Mohit Dargani says he is personally "not refusing" to provide the documents asked by the Senate, and that the firm is merely "invoking [its] right" as advised by their legal counsel.

@eimorpsantos @pplmanuel @kristellimpot Sen. Risa Hontiveros asks Pharmally's Mohit Dargani about the Ferrari being sold online under his name.

Dargani: I was not selling that. That's not my phone number on that post. I was pranked by a friend.

@eimorpsantos @pplmanuel @kristellimpot Sen. Hontiveros notes the differences between Pharmally's price list in its contract with DOTr's PNR in Aug. 2020, and its catalogue prices at around the same time. Figures show the firm sold medical supplies at a higher price to the government.

@eimorpsantos @pplmanuel @kristellimpot Sen. Drilon: This is why it is very important that we get hold of the support documents for [Pharmally's] financial statement on cost of sales. That is where it will be shown there is indeed an overpricing.

@eimorpsantos @pplmanuel @kristellimpot Sen. Hontiveros asks the basis for the higher prices charged to the DOTr.

Pharmally's Mohit Dargani: These are all determined by our cost. When we sold them to the gov't in April, then we must've purchased them in March, and the prices are really more expensive.

@eimorpsantos @pplmanuel @kristellimpot Pharmally's Mohit Dargani has left the virtual hearing while still in the middle of questioning.

This was after the Senate committee directed that he and Twinkle Dargani immediately be detained until they answer questions on source documents for the firm's financial statements.

@eimorpsantos @pplmanuel @kristellimpot Sen. Hontiveros presents a list of top suppliers bagging a cumulative 42% of pandemic supply contracts.

But COA chief Aguinaldo says more than the percentage, the amounts listed are something that should be look at more closely.

@eimorpsantos @pplmanuel @kristellimpot COA chief Aguinaldo: Just the sheer amount involved would already be what we would call one of those areas where there is a great audit risk.

@eimorpsantos @pplmanuel @kristellimpot Sen. Gordon: Kailangan magdagdag pa tayo ng hearing because hindi pa nga natin nakikita yung cost of goods sold. Magkano nila binili sa China?... Why will you go to China, at papayag ka bang patungan nang dalawang beses kung may available dito?

@eimorpsantos @pplmanuel @kristellimpot COA chief Aguinaldo says the higher price list provided by Pharmally to the gov't is a "red flag" and should be examined closely.

But he adds: Whether it is overpricing or not, of course, it's another issue.

https://twitter.com/cnnphilippines/status/1450349221383585798

@eimorpsantos @pplmanuel @kristellimpot Xuzhou Construction Machinery Group, the govt's 2nd top pandemic supplier next to Pharmally, says it also supplies medical items to China, Singapore, Malaysia, Indonesia, Australia, & Thailand.

Asked if it is an accredited importer of the PH Bureau of Customs, it says it is not

@eimorpsantos @pplmanuel @kristellimpot Xuzhou Construction Machinery Group: We do not directly import. It's the DBM who gets from us... The clearance with Customs is handled by the DBM.

Sen. Gordon: That's the first time I ever heard DBM handling clearances for a Chinese company.

https://twitter.com/cnnphilippines/status/1450362908286742528

@eimorpsantos @pplmanuel @kristellimpot Xuzhou Construction: We are an international trading company, we don't have a local office. The clearance is done by the company which buys from us.

The firm says it has had only two transactions with the PH government.

@eimorpsantos @pplmanuel @kristellimpot Sen. Gordon asks how long it took Xuzhou Construction to get its first contract with PS-DBM. The firm says around one week, adding the first order was made in April last year.

@eimorpsantos @pplmanuel @kristellimpot Xuzhou Construction says its main line of business in the Philippines is exporting machineries and that it was only in 2020 that it began providing medical supplies to the country.

@eimorpsantos @pplmanuel @kristellimpot Sen. Drilon: Do you have a license to do business in the Philippines?

Xuzhou Construction: We don't need that because our transactions are based on CIF or FOB.

@eimorpsantos @pplmanuel @kristellimpot Xuzhou Construction says for the first order, it provided PS-DBM with medical supplies worth ₱446M, while the second order amounted to over $33.12M (or around ₱1.6B).

@eimorpsantos @pplmanuel @kristellimpot Xuzhou Construction clarifies it has been supplying medical items even before 2020 but not to the Philippines.

@eimorpsantos @pplmanuel @kristellimpot Sen. Drilon: You entered into a transaction in PH where you made income, and therefore under PH laws, you are liable for income taxes.

@eimorpsantos @pplmanuel @kristellimpot Xuzhou Construction says it is a state-owned company in China, and therefore pays income taxes there. "Because we don't accept payments in PH, we also don't pay income tax in PH."

https://twitter.com/cnnphilippines/status/1450383605545373697

@eimorpsantos @pplmanuel @kristellimpot Sen. Drilon maintains Xuzhou Construction should pay income taxes to PH gov't for supplying medical items here. He then proceeds to ask BIR to examine how it can collect the taxes on the nearly ₱2B sales the firm made from its contract with the PS-DBM.

@eimorpsantos @pplmanuel @kristellimpot Sen. Gordon blames Pres. Duterte's order, which blocks executive officials from Senate probe, for inability to immediately determine if the firms being probed have paid taxes. "The interest of the gov't is being hampered by this stupid order issued by the President," he says.

@eimorpsantos @pplmanuel @kristellimpot The Senate Blue Ribbon Committee suspends the hearing until 11 a.m. of Oct. 28.