More than P9 million in PhilHealth benefit claims meant for hospitals in the Cagayan Valley Region was diverted to a rural bank in Bataan in May 2019, the state insurer’s resigned anti-fraud legal officer Thorrsson Montes Keith told a Senate investigation on Tuesday, August 11.

Keith said that between May 2 and May 22, 2019, a dozen transactions amounting to a total of P9,705,332 were credited by PhilHealth employees Editha Conel and Jerome Follante to the Balanga Rural Bank, Incorporated (BRBI) based in Balanga, Bataan.

Conel and Follante are both employees of PhilHealth Regional Office in the Cagayan Valley Region (PRO-2), according to Keith. Conel is the head of the Accreditation and Quality Assurance Section in PhilHealth-Cagayan Valley.

A Deutsche Bank branch in Cagayan Valley had been missing PhilHealth benefit payments worth P9,705,332 – the same amount that turned up at the Balanga Rural Bank, which is in Region 3, or Central Luzon.

“There is no way PRO-2 can pay banks situated in Region 3,” Keith said, adding that Conel and Follante claimed they inadvertently credited the amount to Balanga Rural Bank.

“This is not merely inadvertent, as the multiple transactions connote deliberate intent to defraud the government by embezzling P9,705,332,” Keith told the Senate panel.

When notified of the erroneous deposits, Balanga Rural Bank initially refused to return the money, but did so when compelled by PhilHealth’s internal legal department, Keith said.

However, Balanga Rural Bank demanded half of 1% of the amount or P49,123 as compensation for the trouble. Keith said Rogelio Pocallan Jr, a senior manager of PhilHealth’s internal legal department, told him Conel and Follante paid for this compensation, which Keith doubted.

According to Keith, Pocallan was one of several senior PhilHealth officials who met with officers of Balanga Rural Bank in Balanga on September 25, 2019.

“I was again wondering why they said the transfer was a mere error, yet it is clear that PRO-2 has no authority and access to banks located in other regions, in this case, Bataan in Region 3,” Keith said.

“I investigated Attorney Pocallan, and I learned that he was taking orders from Attorney Rodolfo “Jojo” del Rosario Jr. Because of this, I also investigated Attorney Del Rosario, and I learned it was supposed to be him who is responsible for conducting investigations on this kind of fraud, but he did nothing and sat on the case for more than a year, to this day,” Keith added.

Del Rosario is the PhilHealth legal sector senior vice president Rodolfo.

The incident was not reported to the PhilHealth Board of Directors or on any official document by executive committee members who knew about it, Keith said. He mentioned Del Rosario, Pocallan, and senior vice presidents Jovita Aragona, Dennis Mas, and Renato Limsiaco Jr.

Keith also noted that Conel and Follante were not officially authorized to pay Balanga Rural Bank its compensation, and it seemed odd to him that the two employees had the cash on hand when the bank demanded it.

“I concluded that P49,123 was actually paid by one of the officers from [PhilHealth] central office,” Keith said.

Keith also said he investigated then PhilHealth vice president Oscar Abadu Jr. “Some people whom I asked information from in PhilHealth believe that the Balanga Rural Bank case was just a decoy to cover up something bigger – corruption by Oscar Abadu and PRO-2 during his stint,” he said.

Meanwhile, Del Rosario “had plenty of travels” to Balanga at the time, Keith added.

“The only thing to do is to determine the real owner of the bank account in Balanga, Bataan, and it will open a Pandora’s Box. This case has established one of the modus operandi of the PhilHealth mafia untouchables, and I have identified some of them,” Keith said.

Senator Panfilo Lacson said the account in Balanga Rural Bank and the one in Deutsche Bank are owned by B. Braun Avitum Philippines Incorporated, a chain of dialysis clinics under question for having received P45 million in cash advances meant for healthcare institutions handling COVID-19 patients. Keith said B. Braun Avitum “might be owned” by Del Rosario.

Del Rosario disputed Keith’s allegations, and denied owning B. Braun Avitum or any healthcare institution. “I am not involved in any corrupt practices,” Del Rosario said.

He added that there was “no cover-up” in Balanga, and that the incident was investigated.

Conel and Follante were found liable for simple neglect of duty. Lacson questioned this punishment, considering the amount involved.

Meanwhile, BRBI president Ma Rosario Banzon said on Thursday, August 13, “That there was no instance that BRBI refused to return the erroneously credited amount, for it remained in the Bangko Sentral ng Pilipinas (BSP).”

She said the bank just waited for PhilHealth to pay the manual transaction charge of P600, and BRBI’s service charge of P48,523 or a total of P49,123.

Banzon also said that the amount credited by the Land Bank of the Philippines to their bank’s Demand Deposit Account with the Bangko Sentral ng Pilipinas were made in 4 remittances between May 3 to 22, 2019. The money was intended as PhilHealth’s payment to B. Braun Avitum Phils, Incoporated.

Banzon also reiterated that no Editha Conel and Jerome Follante of Philhealth Regional Office in Cagayan Valley stood as account holders, and that the transaction was only between BRBI and LBP.

Keith, a lawyer, resigned as PhilHealth anti-fraud legal officer on July 23. He cited “widespread corruption” in the government-owned corporations among his reasons for quitting. His resignation takes effect at the end of August.

He has since been a key witness in the Senate’s probe into the allegations against the state health insurer.

PhilHealth’s top officials have denied Keith’s earlier claims. – With reports from Randy Datu/Rappler.com