Philippine Government Indicts Prominent Independent News Site on Tax Charges

November 13, 2018
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by Patrice Taddonio Digital Writer & Audience Development Strategist

Maria Ressa, executive director of Rappler Media, pictured in an interview for the FRONTLINE documentary, "The Facebook Dilemma."

In a blow to the independent news landscape in the Philippines, the country’s government has indicted the parent company of Rappler and its president, Maria Ressa, on tax evasion charges.

Rappler, a prominent Philippine news site, has critically covered Philippine President Rodrigo Duterte, whose drug war has resulted in the deaths of thousands of Filipinos, including through extrajudicial killings by the country’s police force. The site has also been a leading voice in reporting on how Facebook has been weaponized to spread disinformation in the Philippines and target the Duterte regime’s critics.

The Philippine Department of Justice alleged that Rappler Holdings Corporation’s 2015 tax return didn’t disclose the equivalent of approximately $3 million in gain related to a transaction involving the Omidyar Network, a philanthropic investment firm led by eBay founder Pierre Omidyar; and NBM Rappler, a fund based in Washington, D.C. The Department of Justice charged the site’s parent company, its accountant, and Ressa with “willful attempt to evade or defeat tax and willful failure to supply correct and accurate information.”

“The issue simply is: Has Rappler violated the law?” Salvador S. Panelo, a Duterte spokesman, said in a statement on Monday. “The Department of Justice (DOJ) has found probable cause hence a case was filed against the media outlet …No one is above the law.”

In a post, Rappler argued that the case “has no legal basis.”  “Let me reiterate that Rappler Holdings has not evaded the payment of any tax obligations in relation to its sale of Philippine Depositary Receipts (PDRs) to two foreign entities in 2015,” Francis Lim, Rappler’s legal counsel, said in the post. “Clearly, this case has no legal leg to stand on because it presumes – wrongly – that Rappler is a dealer in securities that profited from a sale.”

In a speech on Friday, Ressa renounced and denied the charges, saying they were a “clear form of continuing intimidation and harassment,” The New York Times reported. 

Duterte’s government had previously accused Rappler of violating foreign ownership laws in connection with support from the Omidyar Network, and withdrew the organization’s license to operate — an action decried by U.N. experts, Human Rights Watch, and Amnesty International. Duterte had also banned Ressa and a Rappler reporter from his palace, and claimed the site was funded by the CIA.

In the October FRONTLINE documentary The Facebook Dilemma, Ressa detailed harassment she has endured in connection with Rappler’s reporting on Duterte — and told FRONTLINE she had been warning Facebook since 2016 that Duterte was using a network of paid followers and fake accounts to spread lies about his policies and attack his critics.

“There were attacks on the way I look, the way I sounded, that I should be raped, that I should be killed,” Ressa tells FRONTLINE in the below excerpt from the documentary. “We gave it a name: ‘patriotic trolling’ — online, state-sponsored hate that is meant to silence, meant to intimidate. So this is an information ecosystem that just turns democracy upside down.”

“President Duterte was targeting anyone who questioned the drug war, anyone who questioned the alleged extrajudicial killings,” she tells FRONTLINE in the above excerpt. “Anyone on Facebook who questioned that would get brutally bashed.”

As the excerpt recounts, Ressa traced disinformation being distributed on Facebook to a network of 26 fake accounts, and reported it to the company at a meeting in Singapore in August of 2016.

In April of this year, Facebook created a news verification program and hired Rappler as one of its fact-checkers, though Ressa told FRONTLINE the problems are ongoing. Facebook ultimately took down the accounts Ressa identified, and just last month removed dozens more.

Watch The Facebook Dilemma in full online.

 

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