Audit

A Senate hearing was called to look into allegations about a local pharmaceutical company employing multi-level marketing schemes to push its sales. The practice has been justly criticized as unethical – the company doing this being owned by doctors.

In an ideal world, doctors must be able to prescribe medicines without any conflict of interest. Most of our doctors adhere to the standing conventions forbidding any conflict of interest – or even any hint of it.

The Senate summoned Bell-Kenz Pharma Inc. to answer allegations it provided doctors involved in its marketing scheme with financial incentives and expensive give-aways. Specimens of checks issued were presented to the hearing. In some of the documents, the payouts were described as “rebates” to doctors who issue prescriptions of the company’s drugs.

Bell-Kenz denies it is involved in a multi-level marketing scheme. It is their word against the claims of whistleblowers who have issued affidavits detailing the company’s dubious marketing schemes.

As it always happens during legislative hearings, the inquisitors tend to come to the hearings unprepared. To cover up lack of preparation, they browbeat resource persons or deliver long-winded oratory. In the most severe instances, legislators order witnesses detained for failing to answer to the inquisitor’s satisfaction.

There are more conclusive methods for arriving at the truth. But the more efficient methods will not give the legislators a platform to grandstand or gain television face-time.

The Department of Health has joined the inquiry into allegations of unethical practices. Secretary Ted Herbosa called for more witnesses and whistleblowers to step up and report what they know. This will help advance the department’s own investigation.

On the allegations made against Bell-Kenz, there is a really simple method for arriving at the truth. It is called a “forensic audit.”

A forensic audit should enable the authorities to see whether financial incentives were indeed given out to doctors. A forensic audit simply follows the money trail from the time the company earned them to the time the cash was dispensed. A simple forensic audit, without need for excessive drama, should establish whether Bell-Kenz’s business model indeed runs on payouts to doctors.

Audits are not appealing to politicians. They involve doing a lot of paperwork in the backrooms without the circus atmosphere that a legislative hearing tends to generate. But a competent audit brings out the hard facts.

Politicians and bureaucrats who reassure us that “investigations” are being conducted ought not to rely on titillating public confessions. The word of the auditor is far more conclusive.

Scare tactic

The Supreme Court took the Comelec to task for its arbitrary ban on another potential bidder for the huge P18-billion elections automation program. The poll body’s high-handedness ran counter to both due process and the spirit of the procurement law.

The Court, however, stopped short of nullifying the bidding conducted that was won by South Korean firm Miru. The company’s systems turned in spotty performance in recent elections elsewhere. Lawmakers have pointed to Miru’s disastrous performance in elections held just last December in the Congo where 45.1 percent of its machines failed.

Recently, former Caloocan representative Egay Erice filed a case at the Supreme Court precisely calling for the contract with Miru to be scrapped. He  says the award clearly violated the Election Automation Law of 2007 that explicitly requires “the system procured must have demonstrated capability and been successfully used in prior electoral exercise here or abroad.” The counting machines considered for the bidding were, by Miru’s own description, “prototypes.”

Erice vividly described the contract awarded Miru as a “robbery in progress.”

When the Supreme Court admonished the Comelec for their arbitrary handling of the bidding, the poll body could have opted to cancel the bidding (where Miru was the singular bidder) on their own and initiate a rebid. They could have done this at the very least to erase any public anxiety about the fairness of the award and the reliability of the system contracted.

Instead of doing that, however, the poll body chose to ignore the admonition of the High Court. Beyond that, the Comelec treated the public to scare tactics to defend its award, claiming that the country could be forced to manual counting if a rebid is conducted late in the day.

The scare tactic has no basis in fact.

We now have 12 months before the next elections. That is ample time.

For the 2016 presidential elections, the Comelec published the bid for new vote counting machines as late as June 2015. The contracts was signed September of that year, eight months before elections.

To complicate matters, just two months before the elections, the Supreme Court ruled that the voter-certified paper audit trail (VVPAT) should be implemented. The contractor had only weeks to update the system accordingly and reconfigure the counting machines. Despite all these, the 2016 elections emerged the most successful in our history with the manual audit confirming 99.98 percent accuracy.

In addition, the Comelec forgets to mention there are 97,000 vote counting machines in their Laguna warehouse. Each of these are backed by comprehensive parts and service warranties valid until 2025. The poll body could opt to use these machines and save our taxpayers billions of pesos while dispelling all suspicions of irregularity.

But the poll body seems too infatuated with Miru to properly weigh all the risks assumed for this contract.