MANILA, Philippines — A chief executive officer of an esports firm will face an investigation by the Department of Justice (DOJ) for allegedly creating “dummy corporations” in a 15-year-old tax scheme that defrauded the government of P50 billion.
The National Bureau of Investigation (NBI) Anti-Organized and Transnational Crime Division yesterday filed the complaint and asked Prosecutor General Benedicto Malcontento to conduct a preliminary investigation into the scam allegedly perpetrated by Bernard “Bren” Chong’s wholesale business Brenterprise International Inc.
Chong is also CEO of Bren Esports, which has teams taking part in international gaming tournaments.
According to the NBI, Chong’s “fraudster company” created “dummy corporations” that serve as “ghost suppliers” to client companies that use the services of Brenterprise to fake receipts.
The NBI described Chong’s company as an “organized crime group involved in the nationwide tax fraud and economic sabotage through the use of several dummy or ghost corporations” which ran from 2008 until last year, when the NBI raided its office in Eastwood, Quezon City.
The NBI called the “modus operandi” an “input value-added tax receipt for sale” in which Brenterprise would invent details of the ghost supplier company for its clients.
In a press briefing yesterday, DOJ Secretary Jesus Crispin Remulla described it as an “elaborate scam” that defrauded the government of “P50 billion in income taxes” over 15 years.
Remulla said the NBI was able to look into the computers of Chong’s company after it raided its Eastwood office in December last year.
The NBI found several food and real estate businesses that employ the fraud company’s services for fake receipts.
Chong’s company imposes a 0.8 percent commission or “regular fee” on the total amount “fictionally purchased” by the ghost supplier for the client company, according to the NBI.
Chong’s company can also impose a 1.5 percent fee on the total amount in the procured receipt if the receipts were facilitated by an “agent” who refers the clients to ghost suppliers, with the 0.8 percent “retained” by Brenterprise.
The secretary, however, said Chong’s P50-billion tax scam is different from the P10-billion pork barrel scam of convicted entrepreneur Janet Lim-Napoles, even though both schemes employed dummy corporations.
At least 1,000 big and small businesses engaged the service of Brenterprise to fabricate official receipts, an NBI source had told The STAR.
Brenterprise personnel fabricate receipts to jack up the actual expenses against gross income in order to lower the income tax to be paid to the government, the source added.
Chong, whose family owns sports apparel World Balance, was earlier cleared by the Court of Appeals in a drug smuggling case before the Manila Regional Trial Court involving P1.8-billion shabu that was intercepted at the Manila International Container Port in 2019.
However, Chong remains a “fugitive from the law” as he has yet to return from abroad, Remulla said.