On the alleged misuse of confidential funds: What the prosecution has shown so far
MindaNews / 21 August 2026 – Article I of the Articles of Impeachment against Vice President Sara Duterte alleges misuse of confidential funds by the Office of the Vice President (OVP) and the Department of Education (DepEd) under Duterte as secretary.
The confidential funds in question totaled P500 million for the OVP and P112.5 million for DepEd.
As of August 17, the prosecution has presented five witnesses, with one of them, former OVP special disbursing officer Gina Acosta, declared a hostile witness on the grounds that in her counter-affidavit she said Duterte should not be held liable for the alleged misuse of confidential funds.
The Senate impeachment court has spent seven days listening to the prosecution’s witnesses for Article I, starting on July 29. The hearings scheduled for August 18 and 19 were canceled due to inclement weather affecting the National Capital Region.
In this article, MindaNews presents a recapitulation of what the prosecution, through witnesses and documents, has so far presented to the court.
July 29
Former Land Bank DepEd branch manager Violeta Constantino testified the OVP withdrew P500 million in confidential funds, while former Land Bank Shaw Boulevard branch manager Nenita Camposano confirmed the DepEd under Vice President Sara Duterte as secretary withdrew P112.5 million, also in confidential funds from December 2022 until July 2023.
Both Constantino and Camposano described the withdrawals by both agencies during their time as branch managers as “unusual” based on the amounts involved. Constantino, however, clarified that while the transactions appeared “unusual” they were legitimate based upon the bank’s standpoint.
Senator-judge Panfilo Lacson interjected that as far as the Anti-Money Laundering Act is concerned, there are no “unusual” transactions, only “suspicious” and “covered”.
August 3
The physical and financial plan on the use of confidential funds by the OVP did not comply with Joint Circular 2015-01 (Guidelines on the Entitlement, Release, Use, Reporting and Audit of Confidential and/or Intelligence Funds) requiring such a plan to indicate the actual use of confidential funds, according to Roderick Wamil, former state auditor of the Commission on Audit – Intelligence and Confidential Funds Audit Office (COA-ICFAO)
Item 4.2 of the joint circular requires every allocation for confidential funds to be backed by a physical and financial plan stating the amount proposed for each program and activity as a basis for the disbursement of the funds.
Wamil testified the OVP only submitted acknowledgment receipts without attaching documents attesting to the “success” of activities that would justify the payment of rewards using its confidential funds as required by the joint circular.
(Earlier on this day’s hearing, private prosecutor Lorna Kapunan sought the stipulation of 845 acknowledgment receipts bearing fictitious names for the release of OVP confidential funds, but the defense refused. However, both sides stipulated to the grants of confidential funds to the OVP and DepEd and their withdrawal in full by the two agencies.)
Wamil said that after receiving an explanation from the OVP about the documents, the COA issued a notice of suspension for non-compliance with the joint circular’s requirement to provide enough documents to prove that they “succeeded” in information-gathering activities using the confidential funds as payment to informers.
According to item 4.27 of COA Circular No. 2009-06, “Suspension is a temporary disallowance. It refers to transactions or accounts which appear illegal/improper/irregular unless satisfactorily explained or justified by the responsible officers or until the requirements on matters raised in the course of audit are submitted or complied with.”
In April this year, the COA issued a final notice of disallowance on P73.287 million in intelligence expenses incurred between December 21 and 31, 2022 by the OVP, citing insufficient documentary evidence to justify the transactions.
The COA-ICFAO issued on March 31 a separate notice of disallowance on the P375 million OVP confidential expenses for the first three quarters of 2023.
August 4
Like in the case of the OVP, the physical and financial plan for DepEd’s confidential funds during Duterte’s time as secretary had no specific activities that would justify spending such funds, in violation of the joint circular, Wamil confirmed during the continuation of his testimony.
He also testified that reward payments across DepEd’s four programs – counterinsurgency, abuse prevention and control within schools, anti-illegal activities operations, and anti-extremism and terrorism – violated the joint circular as well. He said that since their specific confidential activities were not enumerated, their physical target could not be matched to specific confidential activities on which the confidential fund would be used.
He further testified that DepEd’s three 2023 disbursement vouchers were approved by then-Finance Undersecretary Annalyn Sevilla rather than by Duterte as the agency head. He said this violated the joint circular, which provides that “the head of the agency shall be responsible for the approval of the cash advances.'”
Defense counsel Michael Poa showed a 1992 COA circular which says that requiring receipts or invoices for safe house rentals and other expenses incurred during intelligence operations is impractical and could leak information or endanger agents.
Kapunan objected on the grounds that the 1992 circular has been superseded by the 2015 joint circular.
Wamil confirmed he is aware that the laws prohibit unauthorized disclosure of confidential information, but maintained that confidential funds are public funds that must be properly accounted for and liquidated.
He also confirmed there is nothing that prohibits using those funds in 11 days, that’s why it was not included in the audit findings but just a “statement of fact on the audit observation memorandum.”
Wamil identified as Duterte’s the signature below the printed line “Certified: expenses necessary, lawful and incurred under my direct supervision” in three OVP disbursement vouchers dated January 31, 2023, April 10, 2023 and July 13, 2023, and on the liquidation reports certifying that the purpose of the cash advance was duly accomplished.
Wamil’s testimony contradicted Duterte’s statement during a press conference on December 11, 2024, where she said she didn’t have a hand in the preparation of these documents.
Wamil also testified the OVP did not attach documents proving payments for medical or food aid for the period February 6 to March 29, 2023, and P40 million for the period April 25 to June 30, 2023.
He confirmed that the total for the two quarters is P82 million based on documents from the OVP, which he said had no attached payment documents for medical or food supplies.
He said COA’s audit observation memorandum flagged these items as these are not included under the joint circular on the use of confidential funds.
August 5
Under questioning from Senator-judge Imee Marcos on whether the COA disallowed the confidential expenditures because the acknowledgment receipts were fake or fictitious, Wamil said the COA does not have a finding on the receipts because it was not the focus of their audit.
He added that since what they did was a compliance audit, and the circular does not have a provision pertaining to the use of aliases, there is no finding too on the use of unusual names like Mary Grace Piattos and Andy Lim, and the names of the reward recipients were not raised in the audit observation memorandum and notice of suspension.
Wamil refuted Marcos’ assertion that the special disbursing officers, not Duterte, should be held accountable because there is nothing that says that the money is with her. He reiterated that Duterte is accountable as head of agency based on the joint circular.
The state auditor also testified prima facie evidence exists that Duterte spent her confidential funds for personal use after her office failed to properly liquidate the funds. He explained it is a presumption under the joint circular that need not be mentioned, and pointed out that the audit findings neither used the word “stolen” nor accused the OVP of faking acknowledgment receipts.
Wamil said the legal presumption is based on Item 8.3 of the joint circular Item 8.3 of which states: “Failure of the AO to liquidate any public funds for which he is accountable, upon demand by any duly authorized officer, shall be prima facie evidence that he has put such missing funds or property to personal use and benefit.” (AO stands for Accountable Officer.)
The provision was based on Antonio C. Martinez vs People of the Philippines and the Sandiganbayan, G.R. No. 123413, 20 August 1999.
In law, prima facie evidence, once established, shifts the burden of evidence from the party asserting a claim to the opponent to rebut it. However, the burden of proof does not shift, as the Supreme Court ruled in Jison v. Court of Appeals (G.R. No. 124853, 1998).
Wamil, again citing the joint circular, said that Duterte, as the head of agency, is responsible for the approval of the cash advances, overseeing the agency-wide utilization [of the funds], and ensuring compliance with the circular.
August 11
The COA had sent a notice of disallowance to the OVP for its P73 million in confidential funds, according to Xylene Mae Del Campo, state auditor of the COA-ICFAO.
The disallowed amount covers P69.5 million the payment of rewards for which the OVP only submitted acknowledgment receipts, and P3.5 million for items that were not enumerated under the joint circular such as furniture and computers. Del Campo said the purchases are not covered by invoices or official receipts which are required.
The OVP appealed the disallowance but COA in April this year affirmed it. The OVP filed a motion for reconsideration in May, which is still pending.
Del Campo testified that based on the Protective Intelligence Operations Reports, Duterte’s engagements from the first to the third quarter of 2023 were attendance in commencement exercises, tree planting activities, courtesy visits and coordination meetings.
She said these purposes are not compliant with the joint circular, and there is nothing in the accomplishment reports that would warrant the payment of rewards.
She testified that the activities on December 13, 15, 17, and 18 are not under the period of utilization of the cash advance covering the period December 21-31, 2022, a violation of the joint circular’s prohibition on the use of confidential funds for reimbursement.
Del Campo also testified that the findings raised by the COA with the OVP when it issued its audit observation memorandum included the following: absence of documented evidence of payments in the liquidation documents; absence of documents evidencing success of information-gathering to support rewards payments; the physical and financial plan of the OVP didn’t specify the specific confidential activities; and, unsigned disbursement voucher showing the receipt for cash advance.
She further testified that different sets of acknowledgment receipts for payments from DepEd’s confidential funds were disbursed in different places across the country on a single date. All disbursements were signed by Edwin Fajarda, DepEd special disbursing officer.
One set dated Feb. 21, 2023, listed addresses in Danao, Malolos, Davao City, Negros Occidental, Agusan del Sur, Makati, and Negros Oriental.
Another set, all dated Feb. 25, 2023, were disbursed in Olongapo, Samar, Masbate, Pangasinan, Compostela Valley, Davao City, Nueva Ecija, Batangas, Kalinga-Apayao, Southern Leyte, and Abra. Several signed receipts had no names.
A third set, all dated Aug. 9, 2023, were also disbursed across the country by Fajarda.
Del Campo pointed out that the addresses on the receipts refer to where the money was paid, not where recipients live. She said that under the joint circular only the special disbursing officer is authorized to release the funds, and that this authority is not transferable.
The defense objected when the prosecution stated that Fajarda could not have visited all these locations in one day.
Senator-judge and presiding officer Francis Escudero told the prosecution to let the documents “speak for themselves,” although he noted that if Fajarda is the only authorized officer, “clearly it’s physically impossible to be in all of these locations in one day.”
August 12
The use of fictitious names by the supposed recipients of payments charged to the OVP’s confidential funds was not among the grounds for the notices of disallowance on the funds, del Campo testified during the cross-examination by defense counsel Kristine Ferrer.
Del Campo said the joint circular is silent on aliases, and neither allows nor prohibits their use in acknowledgment receipts.
Ferrer presented the names the prosecution flashed during the examination, and got a confirmation from del Campo that none appears in the notice of disallowance dated March 31, 2026.
Kapunan objected when Ferrer asked whether a funny-sounding name automatically means it is fictitious, saying “that the names were funny or fruit salady or names of congressmen or senators is immaterial,” citing that during the direct examination, the acknowledgment receipts were shown to illustrate how the funds in question were used.
Asked by Senator-judge Bam Aquino why names like “Piattos” and “Bacon” in the acknowledgment receipts did not raise red flags, del Campo said COA’s compliance audit does not verify the identities of the recipients, and presumes regularity based on the special disbursing officer’s certification under oath that the funds were used for necessary confidential operations and for legal purposes.
Aquino said some of their lawyers consulted former COA Commissioner Heidi Mendoza, who said that unusual names can trigger a fraud investigation.
Del Campo said a fraud audit remains possible, but is still being studied with the [COA] chairperson considering that transactions by the OVP and DepEd “contain voluminous documents with sensitive information that might be exposed if turned over to another agency.”
Asked by Aquino what “fraudulent” means and whether the use of aliases is prohibited and illegal, del Campo said the joint circular is silent on the use of aliases, but added that the money should be given to a real person and used on the proper confidential operations.
Under cross-examination by Ferrer, del Campo maintained the reports submitted by the OVP were not enough to justify reward payments from confidential funds. She said the reports were insufficient as evidence showing success of its information-gathering activities.
Asked by Escudero which payments were disallowed, del Campo clarified that only the reward payments require evidence of success, not the payment for information. She said reward payments require an outcome like an arrest, for instance, while payment for information can cover confidential operations that result in no untoward incidents.
After Ferrer pointed out that the arrest requirement is not specified in the joint circular and Escudero sought clarification on it, del Campo explained that it is based on her own professional judgment and on the attached documents of other agencies she audited which showed arrests to support rewards payments.
August 17
Gina Acosta, former special disbursing officer of the OVP, said physical and financial plans involving confidential funds are “generic” and don’t need to specify targets and activities, arguing the joint circular does not require specific activities.
The testimony of Acosta, who was presented by the prosecution as a hostile witness, contradicted the testimonies of state auditors at the impeachment trial that physical and financial plans should indicate specific activities as required under the circular.
Acosta also testified that the inputs to the OVP physical and financial plan came from Col. Raymund Lachica, then-chief of the Vice Presidential Security Group.
She added that upon Duterte’s instruction she turned over the confidential funds to Lachica, whom the Vice President had designated as security officer, and that it was Lachica who disbursed the funds as the “expert” on confidential activities.
She said she relied on Lachica’s utilization report as evidence that he has implemented the various confidential activities or operations on the ground “because he is the expert.”
Acosta acknowledged she could not find any provision in the joint circular allowing a security officer to disburse such funds, although she earlier cited the document as her basis for turning over the money to Lachica.
She also confirmed Lachica’s name does not appear anywhere in the OVP’s physical and financial plans, accomplishment and liquidation reports or certifications submitted to COA despite providing all the inputs for those documents and being the one who implemented the plan. (H. Marcos C. Mordeno/MindaNews)
No comments:
Post a Comment