Pharmally transactions tainted with 'badges of fraud' - Carpio

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Metro Manila (CNN Philippines, September 25) — Retired Supreme Court Senior Associate Justice Antonio Carpio said the transactions of embattled Pharmally Pharmaceutical Corp. with the Procurement Service of the Department of Budget and Management (PS-DBM) have what lawyers call "badges of fraud."

Carpio noted that PS-DBM issued inspection reports of the goods - which were still in China - even without seeing them first.

He said this is falsification of public documents under the Revised Penal Code - "making it appear in a public document that an event or act happened when it did not."

Carpio explained Pharmally is just a "paper corporation," being undercapitalized with a paid-up capital of just only ₱625,000.

"No track record - no previous sales to government or private sector; has no factory, has no store, no warehouse, no delivery vehicles, no salesmen, no office (Fort Victoria Tower B in Fort Bonifacio unit vacant since 2018); and no permit to import any pharmaceutical product in 2020, the former magistrate said in a forum organized by opposition coalition 1Sambayan.

Yet, Carpio pointed out that Pharmally bagged negotiated contracts with the government worth ₱8.9 billion in just three months in 2020.

"This is a record in the Philippines, if not in the world," he said.

The Senate Blue Ribbon Committee is currently looking into the "overpricing" of face masks and face shields purchased by the PS-DBM and the Department of Health.

An executive of Pharmally admitted in one of the hearings that former presidential adviser and Chinese businessman Michael Yang lent money to pay for COVID-19 supplies.

Carpio said Yang was the indispensable financier and bridge between Pharmally and the Philippine government.

Cabinet can't be prevented from attending hearings

Meanwhile, the President cannot bar Cabinet members from attending the Senate inquiry on Pharmally because the investigation is in aid of legislation and not the question hour, according to Carpio.

"In investigations in aid of legislation, the Cabinet members attend as ordinary witnesses or resource persons. In the question hour, the Cabinet members attend as heads of departments," he explained.

President Rodrigo Duterte earlier said he would require his alter egos to get clearance from him first before they can attend the Senate probe.

While the President can invoke executive privilege to stop his Cabinet from participating, it's only valid when it comes to matters of national security, state or diplomatic secrets, Carpio said.

"How can there be executive privilege in a face mask purchased by PS-DBM? There's possibly no way you can invoke privilege, so I cannot see any valid ground for the President to invoke executive privilege in the Pharmally investigation," the retired justice said.