Vice President Sara Duterte’s office failed to submit the required documents to the Commission on Audit (COA) on its use of ₱125 million in confidential funds, which was spent in 11 days in 2022, a COA auditor told the Senate impeachment trial on Monday, Aug. 3.
It even spent ₱50 million, which was not allowed under the guidelines governing the use of such funds, according to COA auditor Roderick Wamil.
The amount included ₱40 million spent on the “payment of rewards” to supposed informers in the form of medical expenses and ₱10 million on incentives and travel expenses, he said.
Wamil was the third witness presented by House prosecutors at the resumption of Duterte’s impeachment trial that centered on the allegation that she misused ₱612.5 million in confidential funds allocated to her office and the Department of Education (DepEd) when she served as its secretary.
He testified on how the Office of the Vice President (OVP) utilized the ₱125 million in confidential funds that were spent for 11 days or from Dec. 21–31, 2022.
“As of this time, [the OVP] has still not provided supporting documents [for the ₱50 million in medical and travel expenses],” Wamil told private prosecutor Lorna Kapunan.
Kapunan said the witness acknowledged the “discrepancies and insufficiencies” in the documents submitted by the OVP to the COA, particularly before its Intelligence and Confidential Fund Audit Unit (Icfau).
LandBank managers told the impeachment court last week about the “unusual” large cash withdrawals by the OVP and DepEd downloaded by the government Treasury from 2022 to 2023.
House prosecutors began presenting on Monday the testimony of state auditors on how the two offices under Duterte justified their spending of the ₱618 million in confidential funds.
Acknowledgment receipts
Kapunan told the senator-judges that Wamil will be testifying for the prosecution on the “15 boxes of the confidential funds,” including acknowledgment receipts (AR) from the OVP made up of 845 documents.
“These documents did not come from the prosecution but are liquidation documents of the OVP and the DepEd,” she said.
Defense lawyer Michael Poa said their panel was “willing to stipulate on the list of documents provided, except for the acknowledgment receipts for the period covering Dec. 21–31, 2022.”
“There are issues in the AR that will be touched on by witnesses in the future,” Poa explained.
In presenting Wamil, Kapunan said the COA auditor was the one who conducted the postaudit of the OVP’s liquidation of confidential expenditures covering the fourth quarter of 2022, particularly Dec. 21–31, 2022, as well as the first, second and third quarters of 2023.
“[Wamil] observed that the documents submitted by the OVP and DepEd were insufficient…and that is why he issued an audit observation memo (AOM) on Sept. 14, 2023, and Oct. 3, 2023, on the period covering Dec. 21–31, 2022,” Kapunan said.
With the OVP responding to the AOMs, Wamil audited its submitted documents and on Dec. 13, 2023, he issued a notice of suspension to the Vice President’s office. A notice of suspension is issued if a disbursement is found to be illegal, irregular, or improper.
An “anxious” Wamil said he is now the state auditor in Pasay City after spending 10 years since 2014 as state auditor of the COA-Icfau.
COA guidelines
He explained confidential funds as lump-sum appropriations from the national budget to a national agency for its confidential expenditures. His job was to evaluate the liquidation of both confidential and intelligence funds of national government agencies based on the criteria set in Joint Circular 2015-01.
The joint circular, he said, provides guidelines in the use, release, reporting, and auditing of intelligence and confidential funds.
Wamil said Duterte was the only Vice President and education secretary whom he postaudited since she was the only one who received confidential funds, compared to her predecessors.
He said confidential funds can be used for certain expenses, including programs for national security and peace and order, rental of vehicles and safe houses related to confidential activities, and rewards to informers.
On questioning by Kapunan, Wamil said the joint circular required strict compliance “since it involves public funds and that’s why there are strict accounting and auditing rules so these funds would not be misused.”
He said he audited the OVP’s ₱500-million confidential funds from 2022–2023, and DepEd’s ₱116.5 million.
Noncompliant
For the Dec. 21–31, 2022 liquidation by the OVP, Wamil said the physical and financial plan approved by Duterte was noncompliant because specific confidential activities were not stated as required by the joint circular. Also noncompliant was the disbursement voucher, he said.
This prompted him to issue an AOM, a written notification of deficiencies in the audit, which will then require the submission of necessary documents.
Wamil said the COA-Icfau tried to serve the AOM to the OVP in September 2023 but was told that no one was authorized to receive it. But on the same day, the OVP sent his office a response to their AOM.
“They attached documentary evidence of payments,” he said, but added that these were only “acknowledgment receipts instead of sale invoices and official receipts.”
Purchases of supplies
Wamil said the OVP made payment to rewards in cash but in the form of medicines and goods. There were “no documents supporting the success of the intelligence-gathering or surveillance activities on the account of the informer,” he said.
He noted various purchases of supplies, including tables, chairs, desktop computers and printers.
“With respect to the payment of chairs, they also did not indicate whether the purchases were really intended for confidential operations of the OVP,” Wamil said.
Asked by Kapunan whether the location of these goods and supplies should be treated as confidential, whether in drugstores, grocery or hardware stores, Wamil said in Filipino: “What is confidential is the purpose for which the funds are used, not where the purchases are made. Those are two different things.”
Following this exchange, defense lawyer Poa then asked Senate presiding judge Francis Escudero to strike out Wamil’s answers from the record, saying the state auditor was not competent enough to testify on what should be treated as confidential because the latter did not state any provisions in the joint circular.
Kapunan, in turn, said Poa had not objected to the questions she asked Wamil three times. Moreover, she said the prosecution panel had pointed out specific provisions in the joint circular, which enumerated allowable and prohibited uses of confidential funds.
Escudero overruled Poa’s manifestation, saying Wamil was competent to evaluate the documentary evidence submitted by the OVP.
Kapunan and Poa also tangled anew during the discussion of ARs that the OVP submitted to COA-Icfau as part of its liquidation evidence, when she presented selected ARs for Wamil’s perusal.
The private prosecutor first asked about the ARs, and Wamil said this served as proof that a payee received the reward payment.
Piattos, other ‘informers’
She then pointed to the AR showing a ₱70,000 “payment of rewards” was given to Mary Grace Piattos, which the 2025 House investigations on Duterte’s confidential funds said was a fictitious name made up by the OVP, particularly being a combination of the name of a restaurant (Mary Grace Cafe) and a popular potato chips brand (Piattos).
Wamil acknowledged that the payment for Piattos came in the form of medicine.
When asked by Kapunan if he looked into the identity of Piattos, he replied in the negative.
Kapunan also named a Renan Piattos in the AR, and Wamil said the “payment of rewards” was given to the former on Dec. 27, 2023, but he said this was made outside the period of December 2022.
Similarly, he said, the ₱295,000 reward of supplies granted to a Nico Harina “outside the disbursement period” of Dec. 21–31, 2022, as the AR showed it was issued on Dec. 31, 2023. No additional document was submitted, he said.
Kapunan mentioned Patty Ting, who was paid ₱150,000 for the “purchase of information” based on the AR. Wamil said he observed nothing here because this was allowed under the joint circular.
When the witness was asked about Andy C. Lim, Kapunan remarked that it sounded like “ang dilim” and “kaya pala hindi ko mabasa, kasi ang dilim.”
This prompted Poa to raise objections in the way the private prosecutor was “coloring the content of the documents more than what is shown.”
Escudero then interjected, telling Kapunan: “I think you know what he’s talking about. Please proceed accordingly.”
Wamil said he noticed that the ARs of Sisfronio Balsac and Gabriel Bisaya, who both received ₱70,000 each in rewards, were issued outside the disbursement period.
When Kapunan asked him about the action he took after getting the additional documents from the OVP, the state auditor said he issued a notice of suspension.
Other findings
Among his findings were:
• Some expenses presented in the ARs but not in the accomplishment report of the OVP.
• There was a discrepancy in the total expenses liquidated. While the total liquidation for the Dec. 21–31, 2022 period should have been ₱125 million, the OVP liquidated ₱125,150,000, or an excess of ₱150,000.
• The payment of rewards in cash was not properly supported with other documents, and the purchase of supplies did not indicate whether these were intended for confidential activities.
• Some ARs did not indicate the date the payee received it.
For ARs dated Dec. 23, 2022, Wamil said the liquidated payment amounted to ₱25,606,000, while the confidential funds with undated ARs amounted to ₱3,276,000, or almost ₱29 million in total.
Asked what happened after he issued the notice of suspension, he said he had no personal knowledge as he had then transferred to the COA office in Pasay City. CS
Read more: Ex-bank managers say large OVP, DepEd cash withdrawals ‘unusual’
