52 Criminal Charges Filed In RMI Hospital Bribery Case

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Pharmacy owner allegedly attempted to win medical contracts

By Giff Johnson

MAJURO, Marshall Islands (Marianas Variety, March 31, 2014) – The Marshall Islands attorney general filed 52 criminal charges against the owner and manager of a Majuro-based pharmacy who, the AG said, bribed Majuro hospital officials on multiple occasions to win bids for medical equipment, supplies and maintenance.

Attorney General Jack Jorbon said charges against Marshall Islands government workers involved in the scheme will be filed in the coming weeks.

Genesis Island Enterprises RMI owner Herminio Alfonso and manager Ariane Jay Demayo were both charged Thursday with 52 criminal counts — 13 each of bribery, theft by deception, securing execution of documents by deception, and criminal conspiracy.

Only Demayo was on island and present at an initial hearing Friday before Chief Justice Carl Ingram. He was ordered to hand in his passport to the clerk of courts and a preliminary hearing is scheduled for April 3.

Private attorney Witten Philippo was initially retained by Demayo, but Deputy Public Defender Karotu Tiba took over handling the initial hearing minutes before it started.

Chief Public Defender Russell Kun said he will be representing Demayo going forward.

The charges list 13 instances between June 26, 2012 and June 26, 2013 when Genesis staff are said to have paid bribes ranging from $500 to $5,000 to associate hospital administrator Francis Silk in exchange for his "using his influence to steer bids toward Genesis by communicating confidential information to Demayo, usually by email, regarding potential MOH orders, and Genesis in turn would provide a ‘padded’ price quotation for the needed item. Silk also aided Genesis by using his influence as associate hospital administrator to recommend sole sourcing to Genesis and not provide an adequate number of price quotations from other vendors."

Financial documents from Genesis that are included as evidence with the charges against Alfonso and Demayo include a check register that lists payments to people under the headings, "incentives to Dr. Eleuterio Magtangob," or "Sir Francis incentive," or "activity for Sir Baines."

A Genesis "profit and loss" statement for 2013, included as AG’s evidence exhibit number two, lists nine individuals receiving over $93,000 as "incentives" in 2013.

The 52 charges against Alfonso and Demayo state that Genesis bribes were used to accomplish orders from the hospital for x-ray film and numerous laboratory supplies and equipment.

One of the a bribes was for a maintenance contract, the AG said, adding: "although the contact was paid in full, the CT scan was not properly working."

The charges stated that the Genesis pair "deceived other health officials who signed on purchase requisitions" to believe the documents were "legitimate and urgently needed."

If Chief Justice Carl Ingram finds good cause to move to trial at the April 3 preliminary hearing, the two will be asked to enter pleas of guilty or not guilty at that time.

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