The “Euro Generals” Scandal: A Cover-up or a Lapse in Judgment?

The reports also mentioned former AFP comptroller Maj. Gen. Carlos Garcia, whose son was detained by U.S. customs officials at the San Francisco airport for failing to declare $100,000 he was carrying and possible implications on the country’s relations with Russia. But these were not detailed.

Failed opportunity
Before saying that the 105,000 euros were to be used to buy intelligence equipment, Dela Paz, interior and local government secretary Ronaldo Puno, and Versoza had offered different explanations in previous interviews.

All three earlier referred to the money as a “contingency fund” for the PNP delegation which Puno said he approved as a cash advance. Members of the PNP delegation denied knowing that there was such a fund.

Asked why they were given a contingency fund larger than the authorized P2.3 million, Abs-cbnNEWS.com/Newsbreak quoted Dela Paz saying in a phone interview last Oct. 16: “Don’t ask me. ‘Yun ang padala sa akin. Dala-dala ko ‘yun para sa grupo. Aboveboard naman ‘yan. It will be subject for liquidation pagbalik namin.”

In the Oct. 21 Senate foreign relations committee probe headed by Sen. Miriam Defensor Santiago, Puno contradicted himself by saying that he had not authorized the release of P6.9 million apart from the P2,314.096 requested and released in the amount of P2,192,056 to the PNP.
The repeated assurances of PNP spokesman Chief Superintendent Nicanor Bartolome as well as government officials like Puno that they are transparent and nothing irregular happened only focused on the larger problem of how well disbursing taxpayer’s money to the PNP and other government officials was being processed and monitored.

The press should have seized the opportunity to provide more explanatory reports on this process and could have provided context by recalling past PNP practices, as well as looking into the security checks at airports. The incident did not only involve Dela Paz’s forgetting to declare excessive cash or his alleged abuse of discretion by carrying a “contingency” fund larger than the P2 million PNP was authorized.

Some helpful reports
The Oct. 26 PCIJ report “Not a convincing ‘alibi’” was helpful in citing irregularities in the purchase of equipment from intelligence funds, which the PNP had been claiming what the money was intended for.
According to the report, the P434.3-million PNP budget for intelligence funds in 2008 was alloted for the conduct of intelligence and counter-intelligence activities but not the purchase of equipment. The report also quoted former budget secretary Emilia Boncondin who asked why Dela Paz was carrying a huge amount when cash transactions in government are only allowed for purchases not exceeding P50,000.

Leonor Magtolis Briones, professor at the University of the Philippines National College of Public Administration and Governance and former national treasurer, agreed that cash transactions are not allowed in government but said the government issues a check for purchases involving more than P10,000. Briones said the incident reflects “a very weak” PNP internal control system.

She told PCIJ that the PNP may have mistakenly thought that intelligence funds are not subject to purview of the Commission on Audit. “Intelligence funds are still subject to audit, but only by the Commission on Audit (COA) chairman,” said Briones, who also served as COA secretary.

“Whether an audit is done or not, or if the COA chairman’s findings and recommendations are seriously implemented, (Briones) adds, is another matter,” the report said.

An Oct. 29 24 Oras report  also provided context by reviewing the 2007 government foreign travel expenses and comparing them with the budget allotted for public service programs. It reported that the government spent P1.2 billion last year for foreign travel, or more than twice bigger than its annual P472-million allotment.

The foreign travel expenses were also almost as big as the P1.7-billion budget allotted for the Department of Education’s school-building program in 2007 and the P1.3-billion budget of the Department of Social Welfare and Development for its programs in 2008.

Using data from COA, it also listed the top 10 government offices with the highest foreign travel expenses. The Office of the President, which spent P588.49 million, placed first. But the report could have also showed if the country was gaining more returns than the expenses paid for in these trips.

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