The Commission on Audit (COA) recently exposed the Armed Forces of the Philippines’ (AFP) failure to return unused funds and its deposit of these in unauthorized bank accounts controlled by military officers.

COA reported that the AFP holds six “unauthorized” bank accounts with a total balance of ₱72.86 million. COA said the AFP should have remitted this amount to the Bureau of Treasury (BTr). The balances came from unspent or undistributed funds intended for the AFP Medical Center (₱68.167 million), Presidential Security Command (₱4.358 million), and Eastmincom (₱335,386.40). The AFP had been ordered as early as December 2022 to close these accounts and return the funds to the BTr, as mandated by law. The AFP did not comply.

Meanwhile, COA demanded that the AFP General Headquarters account for ₱201.86 million in “unliquidated” funds—or expenses without submitted reports—for 2024. Part of this sum has remained unliquidated since as far back as 1981, or 43 years since the money was spent.

Irregularities involving illegal bank accounts and unliquidated funds in the AFP are not new.

In 2021, COA also criticized the AFP for maintaining 20 illegal bank accounts containing ₱1.813 billion. A large portion of this amount (₱1.346 billion) was earmarked for the AFP Modernization Act Trust Fund–Central Office. It should have been returned to the national treasury but AFP generals held on to the money.

COA can use the failure to remit unused funds as grounds to disallow further releases to the AFP and to impose administrative sanctions or file criminal charges such as malversation or technical malversation against the involved military officials.