COA says PCGG should seek legal action vs. PNB

The Commission on Audit (COA) has recommended that the Presidential Commission on Good Government (PCGG) seek legal action against the Philippine National Bank (PNB) for not submitting supporting documents on the P157 million spent for the recovery of the alleged ill-gotten wealth of the late dictator Ferdinand Marcos and his family.

"File and institute an appropriate legal action against PNB to compel submission of the supporting documents in accordance with Section IX of the Custodianship Agreement," state auditors said in their 2018 annual audit report on the PCGG.

The COA said the balance in the PCGG's foreign currency savings account for charges and disbursements worth P122.5 million was "unreliable" due to the PNB's lapses, with only $924.50 in "retainer's fee" duly supported with a sales invoice.

The PCGG, under the leadership of the late Haydee Yorac, authorized the PNB in 2004 to cover the expenses needed for the recovery and transfer and assets seized from Marcos's family and cronies.

This includes proceeds from the ARELMA account in the United States, which was organized by the Marcoses for the sole purpose of maintaining an account and portfolio in New York; and the WestLB Account in Singapore, where $25 million worth of alleged ill-gotten wealth was stashed.

The condition then was that PCGG retained five percent of the total amount seized from these accounts.

However, the COA said, P157 million worth of disbursements remained unsupported between September 2016 to December 31, 2018, despite the responsibility of PNB to provide the PCGG the documents it needs.

PNB 'fully cooperating'

In a statement to GMA News Online, PNB said that it is cooperating with the government agency on the matter.

"PNB is fully cooperating with the Presidential Commission on Good Government (PCGG) regarding the issues raised by the report. The bank does not have a copy of the full report. PNB will fully cooperate with the authorities on this," the bank said.

PCGG lapses

The COA also called out the PCGG for its lapses in ensuring its foreign currency account is reported correctly.

"Due to the failure of the management to: update the balance of the account; obtain the bank statements and its supporting documents; and convert the dollar amount to applicable exchange rate, the audit team cannot ascertain and verify the accuracy of the cash in bank-foreign currency savings account recorded in the financial statements," the COA said.

The COA thus issued a notice of suspension on the disbursement on April 11.

The commission instructed the PCGG to regularly update the balance of its account, submit all documents and authorizations for the disbursements in its disposal, and coordinate with PNB for the submission of bank reconciliation statements.

The PCGG management agreed to follow the recommendations of the audit team, according to the COA.

Points to past admins

In a statement, the PCGG pointed to previous administrations as those behind the disbursement. It said only $5 million was used under the term of acting chairman Reynold Munsayac, which was transferred to the national treasury.

“It should be noted that present administration of PCGG did not authorize any disbursement from the subject PNB account, aside from the 5 Million Dollars that was transferred to the Government Treasury,” the PCGG said.

The agency, nonetheless, said it has coordinated with PNB to obtain the documents needed by the COA. It also touted that the foreign currency account only started to be subjected to COA audit under the current leadership.

“Most of the disbursements from the account occurred during the past administrations but the PCGG is now communicating with PNB to turnover to COA the documents related to the fund,” the statement read. — with Jon Viktor D. Cabuenas/BM, GMA News