MANILA, Philippines – The Commission on Audit (COA) has demanded the refund of P45 million worth of confidential and intelligence funds of the Makati City local government under former mayor Jejomar “Junjun” Binay Jr for the years 2011 and 2013.

As such, the COA is holding Binay liable for the disallowance, together with former city administrators Eleno Mendoza Jr and Marjorie de Veyra, and former budget officer Lorenza Amores, according to two notices of disallowance (NDs) released by COA on September 5.

As the liable people, Binay and his former officials are directed “to settle immediately the said disallowance” or to return the funds to the government.

An ND is subject to appeal.

Why the demand for refund? Recomputation by COA showed that there was an excess for the intelligence and confidential funds (ICF) of the city for 2011 and 2013.

Both disallowances have to do with the city’s peace and order programs (POP). Under existing rules, the allowable intelligence funds should not exceed 30% of the POP.

For both years of 2011 and 2013, COA found that the city’s POP included hundreds of millions to pay for personal services or salaries, allowances and benefits of the personnel of the Makati Public Safety Department or MPSD.

State auditors said that according to the interior department’s Memorandum Circular No. 99-65, personal services of the MPSD “are not allowed to be part of the peace and order programs.”

By taking out the MPSD’s personal services funds, the POP shrank, resulting in the decrease of the 30% allowable intelligence and confidential funds. Given the adjusted peace and order funds, the cash advances were found to be excessive: specifically by P20 million in 2011 and by P25 million for 2013.

Moreover, the COA found another deficiency in the 2013 ICF.

When Makati requested P50 million for ICF, state auditors said the local government was able to secure only the required approval of the Office of the President (OP) to disburse only P25 million applicable to the 2013 1st semester ICF needs of the city.

“Hence, the release and disbursements of P25 million for the 2nd semester 2013 intelligence and confidential expenses has no basis due to lack of the approval of the President of the Philippines, in violation of Section 2 (V) – Documentary Requirements of Circular No. 2003-003 dated July 30, 2003 and COA Circular No. 85-245 dated September 12, 1985,” said COA.

Both notices of disallowance were issued by the office of chairperson Michael Aguinaldo, but signed by Director Mario Lipana “by authority of the chairperson.”

Can Binay be criminally charged? The COA’s notices of disallowance are not enough basis to start criminal charges, unless someone files a complaint before the Office of the Ombudsman.

COA and the Office of the Ombudsman created in 2017 a Joint Investigating Team (JIT), where transactions found to be irregular shall be prioritized for prosecution.

“The JITs shall investigate fraud audit-related complaints or reports arising from the same or closely-related transactions or acts involving at least P100 million; graft and corruption cases investigated by Congress and other JIT cases imbued with public interest regardless of the amount involved,” said COA. (READ: COA to Binays: Refund P2.29B used for Makati parking building)

It remains to be seen whether this mechanism will kick in.

Binay, along with his father and mother, are already facing charges before the anti-graft court Sandiganbayan for anomalous projects in Makati, most infamous of which are the allegedly overpriced Makati City Parking Building, and the Makati Science High School. – Rappler.com