COA reports

COA flags AFP for P1.8 billion in unauthorized bank accounts

Jairo Bolledo
COA flags AFP for P1.8 billion in unauthorized bank accounts

FLAGGED. Logo of the Armed Forces of the Philippines.

The defense department says they are in the process of closing the bank accounts

The Commission on Audit (COA) has flagged the Armed Forces of the Philippines (AFP) for its unauthorized bank accounts, whose contents amount to ₱1,812,797,567.87 (approximately $36 million). 

In its audit report for 2020, the COA said that the P1.8 billion was divided into 20 bank accounts and deposited into different banks, including Land Bank of the Philippines, Development Bank of the Philippines, and United Coconut Planters Bank. 

The auditing commission added that the accounts are continuously retained by the military despite the absence of the Permanent Committee’s permission. The committee was created under the Administrative Code of 1987 and is headed by the finance and budget secretaries. Officials of the COA sit as members of the committee. 

Under Section 10 of the General Provisions of the Financial Year 2020 of the General Appropriations Act, the balances of all Special Accounts, Fiduciary or Trust Funds, and Revolving Funds to the General Fund which have no legal basis for their creation should either be closed or reversed. 

The breakdown of the accounts and their balances are as follows:

  • 1,346,059,600.33 billion ($26.9 million) in three bank accounts under the AFP Modernization Act Trust Fund-Central Office 
  • P347,483,190.39 million (around $6.9 million) in eight bank accounts under the AFP Educational Benefit System Office
  • P84,362,300.55 million (around $1.6 million) in two bank accounts under the AFP Real Estate Office
  • P37,744,283.45 million (around $755,000) in seven bank accounts under the General Headquarters Central Office 

The AFP Modernization Act Trust Fund has the highest remaining balance among the unauthorized bank accounts. The fund is administered by Defense Secretary Delfin Lorenzana and used for military modernization. 

The fund does not include military personnel’s salaries and allowances. It does include proceeds generated from the sale, lease, or joint development of military reservations. 

In a statement, the Department of National Defense (DND) said it is already processing the closing of the said accounts. 

“The DND-AFP has been processing the closure of these accounts in adherence to the COA guidelines. However, some accounts cannot be closed outright as these are the depository accounts for our current projects, most of which are multi-year obligations,” the DND said.

Unutilized COVID-19 fund

The COA also flagged the military for its unutilized COVID-19 funds.

Out of the P357,871,353.46 million (around $7.1 million) in pandemic funds of the AFP General Headquarters Central Office, only P133,153,963.62 million (around $2.6 million) was utilized. 

This means that a total of P224,717,389.84 million (around $4.4 million) was left unspent. –

$1 = P49.99

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Jairo Bolledo

Jairo Bolledo is a multimedia reporter at Rappler covering the police, crime, military, and security.