The COA takes a proactive stance in preventing, detecting, or responding to allegations of fraud in all government transactions, and encourages the public to report such transactions to the Commission. This is in line with the COA’s mandate to prevent, detect and report fraud and corruption in government transaction, and for the promotion of transparency, accountability and good governance.
In 2009, COA Memorandum No. 2009-028 dated June 15, 2009 was issued creating the Fraud Audit and Investigation Office (FAIO), now the Fraud Audit Office (FAO) pursuant to COA Resolution No. 2012-016 dated December 7, 2012, tasked to evaluate complaints/information/request for fraud audit as well as the conduct of fraud audit.
With the increasing number of reports from stakeholders alleging fraud committed by government officials/employees, as well as requests for fraud audit, COA Memorandum No. 2015-007 dated April 16, 2015 was adopted. Said Memorandum prescribed the disposition of complaints and/or request for fraud audit irrespective of source with the active participation of the Operating Sectors in the prevention and detection of fraud and corruption.
COA Memorandum No. 2020-014 dated September 30, 2020 then amended COA Memorandum No. 2015-007. It streamlined the procedures in the evaluations of complaints, simplified the actions to be taken by the auditors, operationalized the active participation or role of the Fraud Audit Services (FAS) in the COA Regional Offices, and delegated to the concerned Assistant Commissioners and Regional Directors a certain level of authority to act on complaints/information/request for fraud audit and conduct of fraud audit.
Accordingly, in line with the proactive stance of the Commission on fraudulent transactions, any official or employee of the Commission are required to ensure that any form of information obtained from any source that fraud or anomaly has tainted or is tainting the transactions is brought to the attention of the concerned Auditing Unit who shall take appropriate action thereon.
On the other hand, any person who has knowledge that the transaction of, or the project/program/activity implemented by any government agency is tainted with fraud or anomaly, or that public officials or employees have committed or are committing fraud or anomaly in transactions involving disbursement or receipt/collection of public funds or use of government properties and other government transactions, may file a written information, complaint or request for fraud audit before the FAO at the COA Central Office for agencies located in the National Capital Region or the Office of the COA Regional Directors for agencies located in the regions, either personally or through mail. They may also send the same to the COA Citizens Desk Reporting System at https://cdrs.coa.gov.ph.
It must be stressed, however, that due to some complaints/information/request for fraud audit which had been found to contain unverifiable allegations, involve insignificant amounts, non-auditable issues, or those beyond its jurisdiction, COA Circular No. 2020-005 dated January 31, 2020 was issued to establish the criteria on the actionability of complaints/request for fraud audit. To be actionable, complaints/information/requests for fraud audit: a) must in writing, whether on paper or in electronic form; b) must allege fraudulent or anomalous disbursement or receipt/collection of public funds and/or use of government property; c) the transaction/s or account/s involved must be described with sufficient particularity; and d) must not merely solicit a general audit of all transactions of agency complained of.
Otherwise, complaints/information/request for fraud audit will be dismissed or referred to appropriate government agencies for allegations that are not within the jurisdiction of the Commission.
For actionable cases it shall be further verified/evaluated by the concerned COA officials or employees. Upon receipt of complaints/information/requests for fraud audit, it shall be transmitted to the concerned Auditing Team of the agency implementing the programs/projects/activities stated in the complaints/information/requests for fraud audit for evaluation and preparation of the Evaluation Report. The concerned Auditing Team shall evaluate whether predication of fraud exist i.e., totality of circumstances that would lead a reasonable, professionally trained, and prudent individual to believe a fraud has occurred, is occurring, and/or will occur.
Also, the concerned Auditing Team is required to make a recommendation on the disposition on the complaint/information/request for fraud audit, either: a) to close/terminate the cases due to absence of predication of fraud; b) to conduct fraud audit due to existence of fraud; or c) not to conduct fraud audit as it is not necessary or not warranted in the meantime.
An Evaluation Report shall be submitted to the a) FAS if the total amount involved is P50 million and below, or cannot be quantified for government agencies in the regions; or b) the FAO Director if the total amount involved is above P50 million for government agencies in the regions and, regardless of the amount involved, for agencies in the NCR. (To be continued.)
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Roland Café Pondoc is a Commissioner of the Commission on Audit