MANILA, Philippines (AP) — The World Bank says it wants a refund of a portion of its $21.9 million loan to the Philippine Supreme Court to support judicial reforms after a review uncovered the misuse of funds.
A bank memorandum submitted to Philippine officials last month says the Judicial Reform Support Project is a "high risk" and its financial statements "can no longer be relied upon."
A copy of the bank's report, released Wednesday by the Philippine Finance Department, asks that $199,900 "ineligible expenditures" be refunded by the end of the month. They include objectionable disbursements for travels and purchases of computers.
The World Bank has acknowledged the document's existence but has not released it to the public.
Midas Marquez, a spokesman for the court, said its Project Management Office has been directed to address the report.
The report specifically identified Marquez and impeached Supreme Court Chief Justice Renato Corona by their position but not by name.
According to the report, Marquez headed the bids and awards committee for the project and was authorized by Corona to approve payments of up to 500,000 pesos ($11,442). The report called the arrangement a "conflict of interest" that "eliminates internal checks and balances" needed for procurement and disbursement functions.
In four contracts under the project, Marquez requested the services, approved the terms of the contracts, authorized contract extensions and payments to the contractor, and was the end-user of services provided, the bank report said.
The arrangement presents a "conflict of interest" and eliminates internal checks and balances, it added.
The World Bank loan was approved in 2003 to improve the speed in resolving cases and to give the public greater access to justice. But the bank said decision-making and implementation of contracts has been limited to a few personnel, leaving the process with diminished internal controls.
Presidential spokesman Edwin Lacierda told reporters the document is the surest evidence that funds meant for judicial reforms were wasted and basic rules of governance were ignored.
"The findings are scandalous as they are shocking," he said.
Finance Secretary Cesar Purisima said "the leadership of the Supreme Court cannot simply dismiss these very serious observations" and urged it to swiftly respond.
Corona is currently undergoing impeachment trial at the Senate for corruption allegations and accusations he tried to block the prosecution of former President Gloria Macapagal Arroyo, who is detained on vote rigging charges.
He has denied wrongdoing.