Chief Justice Corona personally met with World Bank officials, bank documents show

Read the SC expenses rejected by the WB

 

My Exclusive by Raissa Robles

Last Monday January 16, Chief Justice Renato Corona denounced as “a huge lie” a leaked World Bank report stating that the WB had rejected the charging of plane fares, dinners, hotel expenses incurred under CJ Corona’s watch. These expenses amounting to US$199,900 were charged against a US$21.9 million WB loan to fund a project for speeding up justice and “enhancing institutional integrity.”

CJ Corona very categorically said:

This (alleged diversion of funds) happened before I became Chief Justice. I was not responsible for this. This happened a decade ago and I have been Chief Justice for just a year and a half.

However, the 97 pages of documents prepared by the WB – which I have obtained – shows that the questionable diversion of funds from the Judicial Reform Support Project (JRSP) took place only last year. The documents – consisting of an Aide Memoire and Annexes – detail the expenses for which the WB demanded reimbursement because these were not in line with the justice project.

Among the rejected expenses were meals of members of the judiciary of Guam and their Philippine counterparts.

Early last year, CJ Corona played host to his Guam counterpart, the Honorable Robert J. Torres Jr. See photo below:

The documents were made available to me by a source whom I can’t identify. All I can say is that these were not obtained from the WB. However, I’ve vetted their veracity and authenticity from two other sources, one of them overseas. Besides, the statement that the WB released today matches the conclusion in the documents.

UPDATE as of January 18,2012, 8:25 a.m.:

OOPS. I may have inadvertently contributed to the World Bank issuing that early Monday statement which caused many people to think that the World Bank had disowned its own Aide Memoire on the JRSP.

What happened was this: I received an e-mail early Monday of January 16 about a “report” detailing the anomalies in the WB-funded justice program. The e-mail came from [email protected] and was sent to many of my fellow FOCAP (Foreign Correspondents Association of the Philippines) members as well as diplomats in various foreign embassies in Manila, including the Russian embassy.

The e-mail address made me suspicious and so I forwarded the “report” to World Bank Manila asking for verification on its authenticity. At that time, the WB had kept quiet on the leaked Aide Memoire.

I was probably not the only one asking for verification.

Later that same day, I learned that Manila Bulletin had written a piece entitled “World Bank disowns JRSP report.” It said:

Erika Leann Lacson-Esguerra, World Bank program assistant for external relations, said Monday the bank did not release to the media a supposed memo regarding the “unsatisfactory” progress of the high court’s loan.

“This email message did not come from the World Bank. Any official statement from the World Bank will be posted online (www.worldbank.org.ph),” Lacson-Esguerra said. [Underlining and boldface mine.]

I was amused to realize that the e-mail that Erika Esguerra was referring to was probably the one I had earlier forwarded to them, asking for their verification.

However, when I woke up the following day, I realized that a different spin had been put in the media on this WB statement: Their denial of the e-mail containing the “report” had turned into a denial of the Aide Memoire itself.

Because of that, I guess, the WB issued another statement on January 17 confirming the authenticity of the Aide Memoire itself. You can view that statement here.

Actually, if you read the Aide Memoire itself, you will realize it has that vintage World Bank touch. It is couched in very respectful language while it relentlessly twists the knife in :)

Because the documents contained in the JRSP are just too many for me to share online and I’m chasing deadlines, I will share with you the most pertinent part – Annex 1 which lists the 19 Supreme Court officials with whom the WB officials met; and the expenses rejected by the WB. [UPDATE: ABS.CBN News has placed the entire Aide Memoire for download on its website. Their copy was separately sourced from my copy, but both are identical. You can access it here.] 

By the way, you will notice that CJ Corona did not disclose that he did meet with WB officials who were in Manila between October 24 and November 11, 2011. The WB mission consisted of Amit Mukherjee (Task Team Leader); Aisha Lanette de Guzman (Financial Management); Ramesh Silva (ICT); Sameul Haile Selassie (Procurement); Gerald Thacker (Phyical Facilities); Maya Villaluz (Environmental Safeguards); Zoi Melina Papoutsis (Results and Fiduciary Review); and Manilena Payos (Fiduciary Review.)

The leaked Aide Memorie was written following this review. In a tiny footnote, the Aide Memoire indicated that CJ Corona was told ahead of time about this October-November review which raised serious “fiduciary” concerns over the fund disbursements in this project. In fact, he knew about the Review in June 2011. The recent Review was to audit expenses since the project was winding down.

In a tiny footnote, the Aide Memoire said:

It was agreed with the Supreme Court that one of the priority ‘wrap-up’ activites under the JRSP would be an Expenditure Review of the judiciary, and such an activity was included in the June 2011 agreed Procurement Plan. At the request of the Honorable Chief Justice, the Bank team shared draft terms of reference for such a Review with the PMO (Supreme Court Program Management Office) for this particular project.

Two of the Review findings of the WB Mission struck me in particular:

First, while unauthorized disbursements for plane fares, hotel and entertianment expenses were charged, some key expenses that were a vital part of the justice project remained unpaid. For instance, again in a tiny footnote – [I just love these footnotes] – the WB Aide Memoire noted the “continuing delays in payments, and in several cases outputs have been delivered but billings appear to be incomplete. And there are activities where amounts to be paid to vendors are still unclear and issues have remained open for more than a year.”

Among the unpaid expenses the Aide Memoire mentioned were “the remaining payment (estimated by the task team to be between P16-21 million) to the previous works contract for the Angeles City hall of Justice, as well as other payments indicated in the Fiduciary Review.”

The second thing that struck me was this statement in the Aide Memoire’s “Fiduciary Reveiw”:

The PMO (Supreme Court Program Management Office) has developed a practice of ‘borrowing’ funds from the designated account to overcome reported dealys in naitonal budget cash releases even after receipt of the Notice of Cash Allocation (NCA) from the DBM (Department of Budget and Management. Funds were ‘borrowed’ to finance expenditures unrelated to the JRSP (e.g. “goodwill Games”, foreign travel, award of honorary degrees to foreign judges, etc.) and later – when such expenditures were questioned by the Bank – re-deposited to the Special Account (for the justice project).

I guess that was what the SC officials concerned told the WB – they merely borrowed from the project to pay for non-project expenses. In other words, they used the fund for the justice project as a form of interest-free bridge loan.

I’d like you to see for yourself the nature of these disallowed expenses. I am therefore reproducing below portions of the document which highlight the description of the expense; who incurred it; and how much was charged to the WB loan.

The reasons stated by the WB for the rejection were always either of the two:

Ineligible – Expenditure (a) not connected with project development objective and (b) activitiy not agreed with the World

Ineligible – Per Loan Agreement, Schedule 1, paragraph 2(c).

Frankly, I’m deeply embarrassed that the office headed by the nation’s top judge is being questioned over its use of borrowed money. Especially because it is the Supreme Court which rules with finality whether or not to uphold the court convictions of persons who have diverted state funds in a similar manner.

In this case, the WB loan can also be considered state funds because in the end, you and I will be paying back the loan.

Annex 1 of the Aide Memoire

Annex 4 Page 16: Table 5. List of Expenditures Declared Ineligible

Annex 4 Page 17, Table 5, List of Expenditures Declared Ineligible

 

Annex 4 Page 18, Table 5, List of Expenditures Declared Ineligible

 

Annex 4 Page 19, Table 5, List of Expenditures Declared Ineligible

 

Annex 4 Page 20, Table 5, List of Expenditures Declared Ineligible