The United States government has accused the founder and president of
Visayan Forum Foundation Inc. (VFFI), a group that has won international
accolades for its campaign against human trafficking, of failing to account for
210 million pesos (US$5 million) in US aid, the National Bureau of
Investigation said.
Based on the complaint of the US
Agency for International Development (USAID), the NBI has recommended the
prosecution in the Department of Justice of VFFI president Ma. Cecilia
Flores-Oebanda, according to NBI antifraud chief Rachel Marfil-Angeles.
The VFFI provides education,
shelter and psychological help to victims of trafficking. It receives funds
from international donors such as the USAID, the US Department of State, Bill
Gates Foundation and Starbucks.
The NBI also recommended the
filing of charges against VFFI directors, finance officers, bookkeepers and
other employees.
Angeles said charges of
falsification of documents were filed against the respondents on September 6,
based on the complaint of Daniel Altman (special agent in charge of the [Europe
and Asia] Office of the Inspector General-USAID), the testimony of two
whistle-blowers and boxes of falsified documents seized in a raid on the VFFI
office in Cubao, Quezon City.
The whistle-blowers said VFFI
fabricated the receipts and contracts to justify the expenses charged against
the 300 million pesos donated by the USAID.
Fake receipts
Angeles said 210 million pesos of
the 300 million pesos from the USAID remained unaccounted for. “However, what
is clear at the moment, based on evidence, is that receipts for 41 million
pesos had been faked,” said the NBI antifraud chief.
Angeles said the NBI probe had
established that the order to manufacture the fake receipts came from the VFFI
president.
“In a meeting, the bookkeepers,
including the whistle-blower, were allegedly ordered by its president to fake
receipts to fill in the gap of unsubstantiated expenses,” she said.
Laurence Arroyo, lawyer of the
VFFI, denied the NBI findings and said that a former VFFI employee could be
behind the falsification of documents.
“The VFFI did not manufacture
fake receipts, and if ever there indeed was questionable receipts it must have
been the work of the bookkeeper who has responsibility over these papers,”
Arroyo said.
‘Ridiculous’
The lawyer also described as
“ridiculous” the statement of the bookkeeper that it was Oebanda who instructed
the finance personnel to manufacture fake receipts to meet USAID audit
requirements.
“Kalokohan, Cecile as president
approves expenses reports submitted to her by the bookkeeper and does not go
over all the receipts of expenses submitted to her,” Arroyo said.
“If ever, there was an anomaly it
was committed by the bookkeeper who we intend to cross-examine during the
preliminary investigation,” he said.
‘Betrayed’
The VFFI lawyer said his client
had expressed disappointment over what the USAID had done against her.
“She felt betrayed by the USAID
which she said was her partner for six years and had even given her awards for
her antihuman trafficking advocacy.” Arroyo said.
He said his client had filed a
motion to quash the NBI search warrant used to raid the VFFI office on August
31.
According to Angeles, 32 boxes of
various receipts were seized from the VFFI office during the raid.
Port project
Angeles described the
whistle-blowers as a former bookkeeper of the foundation and an auditor hired
by USAID to audit the funds funnelled into VFFI for its “Port” project for
2005-2011.
In her narration to the NBI, the
bookkeeper said that from March to April 2010, auditors from B.F. Medina and
Co. arrived in the VFFI office to conduct a field audit of the USAID funds.
The whistle-blower together with
two bookkeepers, finance officer and another employee were allegedly summoned
by Oebanda to her office and ordered to “fill the gap of the liquidation.”
The former VFFI bookkeeper said
“they were instructed by Oebanda to fill the unliquidated cash advances with
supporting receipts.”
Copy suppliers’ receipts
In her sworn statement, she said
that in 2006, Oebanda instructed her staff to copy official receipts from
different suppliers and vendors to be used for the liquidation of the US aid.
“Seventy per cent of the
disbursements of the USAID funds were not supported by documents, which
prompted the fabrication and tampering of the receipts to support the
liquidation,” the whistle-blower said.
She added that Oebanda had
instructed that “the amount to be indicated in the official receipts would
depend on the amount of cash advances needed to be liquidated.”
The whistle-blower said that if
the receipts were complete, a liquidation report was accomplished and
thereafter attached to the vouchers to indicate the amount taken from the
funds.
Provisional receipts
She also alleged that Oebanda had
ordered the purchase of provisional receipts from bookstores to cover minimal
expenses for such items as sanitary napkins, soaps and other personal needs,
and cell phone load.
“These provisional receipts form
part of the liquidation reports attached to the vouchers,” she said.
Scotch tape
The former VFFI bookkeeper
further said that receipts, which had been used in other audits, were being
recycled to be used for future audits.
“The dates and the amounts
indicated in the official receipts were altered by using scotch tape,” she
said.
Angeles said, “The tampering and
the alterations were very obvious and scotch tape marks were visible based on
our analysis.”
No beneficiaries
The other whistle-blower, an
auditor, said an initial audit found that funds from the operational budget
were disbursed without real beneficiaries, and lacked adequate supporting
documents, transaction authorisation and approval.
The auditor said purchases were
made without obtaining the required three quotations from potential vendors.
Also discovered was the lack of segregation of duties.
Report to DSWD
She noted that there were
alterations on receipts and invoices; inconsistencies with data submitted to
auditors and the Department of Social Welfare and Development (DSWD);
irregularities in the payroll system; and inefficient records retention.
The auditor added there were
disbursements without supporting original receipts and invoices from suppliers
and vendors.
The supporting documents for vouchers
were photocopied documents. In some cases, VFFI stationery, cash vouchers and
ordinary receipts that can be bought easily from bookstores were passed on as
receipts.
The auditor added that
alterations on supporting documentation (invoices and original receipts) for
liquidation forms were made.
Liquid erasers
She noted that certain VFFI
employees altered the dates of transactions using liquid erasers.
The employees altered the invoice
by adding another number to the amount paid, she added.
For cash receipts, she said, the
audit showed that certain employees intentionally cut the portion where the
date was indicated to avoid detection.
US$ = 41.7 pesos
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