PUBLIC ADMINISTRATION: Requirement for collateral from staff performing

functions of management and custody of public resources.

Taking into account the broad interpretation of

public official, performs functions that
involve the management, custody, and safeguarding of
public resources referred to in article 161 of
the Organic Law on Financial Administration of the Sector
It is believed that such personnel is required.
provide a bond before the Office of Internal Audit
corresponding.

The bond is a measure that the legislator adopts to ensure or guarantee in

sufficiently shapes the results of the committed official's management, for
with the State, in order to guarantee the results of its management.

In this regard, the Organic Law of Financial Administration of the Public Sector in
Article 161 states:

Article 161. The officials in charge of the administration and

settlement of national revenues or of the reception, custody and
management of public funds or assets, will provide collateral before
enter into the exercise of their functions, in the amount and manner that
determine the regulations of this Law. The bond is established for
respond to the quantities and goods handled by them
employees and the damages they cause to public assets
for failure to comply with their duties or for negligence or
incompetence in the performance of their duties.

On the other hand, articles 51 and 52 of Regulation No. 1 of the Organic Law of the
Financial Administration of the Public Sector, regarding the Budgetary System,
establish

Article 51. The appointment of the officials responsible for

the administrative units that are part of the structure for the
financial execution of the expense budget will be carried out by
the highest authority of the corresponding body and published in the
Official Gazette of the Bolivarian Republic of Venezuela.

Article 52. Before commencing the exercise of their functions

The officials referred to in the previous article will provide a guarantee.
before the Internal Audit of the respective body for an amount up to
equivalent to one hundred fifty tax units (150 U.T.),
through the establishment of guarantees provided by an institution
 banking or insurance company domiciled in the country, of
recognized solvency.

As we appreciate, the transcribed article 161 of the Law in question establishes that
broad and general obligation that officials in charge have to
administration and settlement of national revenues or the receipt, custody and
management of public funds or assets, and complementarily, devices 51 and
52 of the referred Regulation No. 1 regulates, in a specific and special manner for a
part, the designation of responsible officials for the managing units
members of the structure for the financial execution of the expenditure budget
by the highest authority, and on the other hand, the obligation of those responsible for these
administering units that are part of the structure for financial execution
from the expense budget, to provide the corresponding guarantee before the Unit of
Internal Audit of the relevant body.

The devices in question refer to the duty of the officials who frame
in these cases, by providing sufficient guarantee to respond for the amounts
and goods they handle and the damages they could cause to public assets,
for failure to comply with their duties or for negligence or incompetence in the
performance of their functions.

Nevertheless, in this situation, it is observed that neither in the Organic Law of Administration
Public Sector Financing nor in its Regulation No. 1 on the System
Budgetary defines what should be understood as a public official for the purposes
from the constitution of the guarantee referred to in articles 161 and 52 of the
referred normative instruments, which is why it is essential, in
attention to the provisions of Article 4 of the Venezuelan Civil Code, to have in
considering the provisions that regulate similar cases or analogous matters,
as well as the doctrine and case law issued on the subject, without losing sight of the
purpose of protecting public heritage that is clearly manifested the
Article 161 as transcribed above.

In relation to the notion of civil servant, the Civil Service Statute Law
establishes the following in its article 3:

Article 3. A public official will be any person

natural that, by virtue of appointment issued by the authority
competent, performs in the exercise of a public function
paid.

From this perspective, it can be noted that public officials are all those who
are covered under the scope of the Statute of the Civil Service Law
Public, when providing services to the agencies that it expressly determines.
Articles 4 and 5: Executive Vice Presidency, Ministries, Governorships, Mayorships,
Autonomous Institutes). However, except for the workers in the service of the
Public Administration, they are also public officials, although this law
exclude from your application (Art. 1°, Sole Paragraph), those officials
belonging to organizations that have particular personnel statutes,
but in any case they fill the extremes that characterize the notion of official
public. This is "(...) the individuals who by reason of appointment of authority
competent or another public law means, participate in the exercise of functions
public services at the service of state public entities; or in other words, 'everyone'
who perform a public function, either free of charge or for a fee, voluntarily or
mandatory, by appointment, election, designation or any other act of
public power in partial, total, temporary or permanent form.

Likewise, it is important to note that the Anti-Corruption Law also contains

a definition of public officials, for the purposes of this Law, in numeral 2
of Article 3, in the following terms:

Article 3. Without prejudice to what the Law stipulates

Establish the Public Service Statute for the purposes of this
The law considers officials or public employees to be:

1.Those who hold public office,

permanent or temporary, paid or unpaid,
originated by election, by appointment or contract
granted by the competent authority, to the service of the
Republic of the states, of the territories and dependencies
federal, district, metropolitan district or of the
municipalities, of the national, state autonomous institutes,
district and municipal, from public universities, from the Bank
Central of Venezuela from any of the organs or entities
that exercise public power."(omitted).

As observed, the Anti-Corruption Law states that they are considered

public officials or employees, among other employees, to those who are
invested with public functions, permanent or temporary, paid or
free, originated by election, by appointment or contract granted by the
competent authority, in the service of the Republic. Therefore, the notion of
public servant (for the purposes of the Anti-Corruption Law), does not include
only to the employees who meet the characteristics mentioned above, but
also to those who perform public functions as contracted by the authority
competent to the service of the Republic.

The provisions of the Anti-Corruption Law evidence the intent of the

legislator to expand the scope or effect of the notion of public official, when
it is about the protection of public heritage. An intention that underlies, likewise,
in other laws such as the Organic Law of the Comptroller General of
Republic and the National Fiscal Control System5, of which they constitute evidence,
for example, its articles 52 and 82, where it is established for the resources
coming from the public sector in the form of transfers, contributions, donations
or any other similar modality, but managed by private individuals, the system of
internal control, of compensation and of sanction specific to the public sector, and where
it equates these individuals with public officials.

Now, to determine whether this notion contained in Article 161 of the Law
Organic Law of Financial Administration of the Public Sector should be interpreted in the
broad or extensive sense derived from the Anti-Corruption Law and the Law that
regarding this Oversight Body, we understand that it must be taken into account that a
One of the purposes of the first of these two laws (Article 1) is to "(...)
to guarantee the proper and transparent management of public resources, with
foundation on the principles of honesty, transparency, participation, efficiency,
effectiveness, legality, accountability, and responsibility enshrined in the
Constitution of the Bolivarian Republic of Venezuela. Entirely aimed at
similar to that expressly declared by article 161 of the Organic Law of
Public Sector Financial Administration by establishing that the object of the
The caution (guarantee) provided there is that the respective officials answer for the
damages caused to public assets. Therefore, we consider that in
everything related to fulfilling that purpose of ensuring proper management
and transparent use of public resources, and therefore for the purposes of interpretation
from the cited article 161, the notion of public official must be understood as having
the scope that this anti-corruption law grants, unless expressly provided in
opposite.

Such a statement is supported even by the content of the cited article 52 of

Regulation No. 1 of the Organic Law on Financial Administration of the Public Sector
About the Budget System, when determining that the officials indicated there
before starting to exercise their functions, they will provide a guarantee before the Audit Office
Internal of the respective body.

Based on the aforementioned, given the broad interpretation or

extensive public servant, combined with the fact that the contracted staff performs a
public function when performing functions that involve the handling, custody and
safeguarding of public resources referred to in article 161 of the Law
We consider that the Organic Law of Financial Administration of the Public Sector
They must provide a guarantee before the respective Internal Audit Unit.

In any case, it is important to warn of the express prohibition of contracting for

perform functions in the positions provided by the Law of the Statute of the Public Service
Public, contained in article 37 of the aforementioned law when it states:
 It can only proceed through the contract route in those cases where it is required.
highly qualified personnel to carry out specific tasks and for a limited time
determined. The hiring of personnel to perform functions will be prohibited.
corresponding to the positions provided for in this Law

From the transcribed provision, it can be inferred that the Public Administration may only
make those hires that are linked, solely and exclusively, with the
provision of highly qualified, specific, and time-limited services
not for the performance of daily activities or functions typical of the body or
described in the Descriptive Manuals of Job Classes for the
Public Administration, even more so when it comes to functions that relate to
the management and custody of public resources, as it implies a violation
from the aforementioned Law. Memorandum No. 04-00-791 of November 8, 2007.
FISCAL CONTROL: Obligation to provide security, in accordance with
established in Article 161 of the Organic Law on Financial Administration of
Public Sector, by the head of the Internal Audit Unit of a
state-owned company.

Within the functions attributed to the Units of

Internal Audit has no assigned activities.
related to the administration and settlement of
national revenues or with the reception, custody, and handling
of public funds or assets, considering that
they do not integrate the structure for the execution of
budget of expenses, aspects that allow one to affirm that
the officials assigned to those fiscal control bodies
internally, they are not required to provide the guarantee
established in the Organic Law of Administration
Public Sector Financing, and its Regulation Regarding the
Budgeting System.

Memo 04-00-137 of March 3, 2011.

The opinion of this General Directorate is requested regarding the scope of article 161 of
the Organic Law on the Financial Administration of the Public Sector, regarding the
obligation that the head of the Internal Audit Unit of a company would have
of the State, to provide the guarantee required by the regulation in question, before
to enter into the exercise of your position, in the amount and manner determined by the Regulations
of the mentioned legal instrument.

Regarding the consulted matter, this General Directorate is pleased to ratify the criteria.
content in memorandum No. 04-02-169 dated August 22, 2003,
opportunity in which the following points were discussed among others:

(...) it is noted that the legal nature of the consulting entity is the
to be a public company of private law, which qualifies
legally within the category of entities of the public sector,
subject to a mixed legal regime, that is to say, it is applied to the
private law due to being constituted under the figure of a company
anonymous, and public law because of its economic configuration
due to the participation of the State, it allows to locate it within the
structure or general organization of the State.

In this sense, being a commercial company with the aforementioned characteristics, it

subject to the regulations established in the Organic Law of the
Public Sector Financial Management, in accordance with the established
Article 6 thereof.
Based on these considerations, it is necessary to address what the Law establishes.
Organization of the General Comptroller's Office of the Republic and the National System of
Fiscal Control, regarding the powers of the Internal Audit Units.

Thus it must be, article 40 of the aforementioned Law states:

Article 40. (...) corresponds to the internal audit units of

the entities referred to in article 9, numerals 1 to 11, of
this Law, evaluate the internal control system, including the degree
of the operability and effectiveness of the management systems and of
managerial information, as well as the examination of records and statements
financial, to determine their relevance and reliability, and the
evaluation of efficiency, effectiveness and economy within the framework of
operations carried out.

In the same line of argument, article 41 thereof provides:

Article 41. The internal audit units in the scope of their

competencies they will be able
carry
to out audits inspections
inspections, examinations, studies, analyses, and investigations of
of all kinds and of any nature in the entity subject to its control,
to verify the legality, accuracy, sincerity, and correctness of your
operations, as well as to evaluate compliance and outcomes
of the plans and administrative actions, the effectiveness, efficiency,
economy, quality and impact of its management.

The transcribed rules clearly establish the functions that must be performed.
the Internal Audit Units, among which the evaluation of the
internal control systems, examine records and financial systems,
conduct inspections, audits, verifications, examinations, studies etc.; situation
that evidence that the mission of these units is to control, for the purposes of
verify the sincerity, legality, and correctness of the operations carried out by the
entities subject to its control.

Now, having clarified these functions, it is necessary to specify who they are.
employees who are legally required to provide a guarantee.

The guarantee is defined by Manuel Osorio in his work "Dictionary of Sciences".

Legal and Political,

Prevention, precaution or caution. Personal safety that is

It will fulfill what was agreed, promised, or ordered. It is an expression.
equivalent to a bond, as it guarantees, in relation to oneself or to
another person, the fulfillment of an obligation, generally
 established judicially, whether of a civil or criminal nature
(…).

By virtue of this definition, it can be inferred that the bond, applied

to the public sphere, it is a measure that the legislator can adopt
to ensure or sufficiently guarantee the results of the
management of the official (...).

Regarding this, the Organic Law on the Financial Administration of the Sector
Public, in its article 161 states:

Article 161. The officials in charge of the administration and

settlement of national income or of receipt, custody and
management of public funds or assets, will provide a guarantee before
to enter into the exercise of their functions, in the amount and manner that
determine the regulation of this Law. The bond is established for
to respond to the quantities and goods they handle
employees and the damages they cause to public assets due to
failure to comply with their duties or due to negligence or lack of skill
in the performance of their duties.

(Omitted)

On its part, articles 52 and 53 of Regulation No. 1 of the Organic Law of the
Financial Management of the Public Sector, Regarding the Budgetary System6
establish:

Article 52. The designation of the responsible officials of the

administrative units that are part of the structure for the
financial execution of the expense budget will be carried out by
the highest authority of the corresponding body and published in
The Official Gazette of the Bolivarian Republic of Venezuela.

Article 53. The officials referred to in the previous article do not

they may take possession of their positions as long as they provide a bond
sufficient for the exercise of their functions, before the Audit
Internal of the respective administrative unit, in accordance with
the provisions in Article 161 of the Organic Law of Administration
Public Sector Finance.

Being then the transcribed article 161 of the Law in question, which establishes
broadly and generally the obligation that the officials in charge have to
the administration and settlement of national revenues or of the receipt, custody and
management of public funds or assets, and additionally, the devices 52 and
53 of the aforementioned Regulation, which specifically and specially regulate the
obligation of the heads of the administrative units that are part of the
structure for the financial execution of the expenditure budget, to provide the
corresponding caution. Such devices establish, therefore, the obligation that
officials who fall under these assumptions must provide a guarantee
sufficient to respond for the quantities and goods they handle and of the
harm that could be caused to the public assets due to lack of compliance with
their duties or for negligence or incompetence in the performance of their functions.

Thus, Articles 52 and 53 of the aforementioned Regulation are

referred exclusively to the bail that must be provided by all those subjects who
intervene directly or indirectly in the management of funds or assets
public, resulting from the designation of the different budgetary credits
turned to the unit in charge or issued in favor of another unit.

These devices are only referred to officials who have the

responsibility for expenses, due to the fact that article 52 itself in reference, it
clearly and precisely establishes when it states: 'The designation of the
responsible for the Administrative Units that are part of the structure for the
financial execution of the expenditure budget ...”, which allows us to conclude that
within this structure, those who perform the functions of are not included
Internal Audit; since, the very article 48 of the aforementioned Regulation,
establishes what should be understood by that structure by stating that it is: 'the set
composed of the central administrative unit and the administrative units
deconcentrated entities that are involved in the management of budgetary credits.

Thus, the obligation to provide this collateral is mandatory for

all those officials who are in the factual assumptions provided
in the referred regulations and, therefore, it is an indispensable condition to provide it, to the
in order to be able to invest the position and consequently exercise the functions that it
competent.

Now, given the reasoning that precedes, and considering that within the
functions attributed to Internal Audit Units are not found
assigned activities related to the administration and settlement of income
national or with the reception, custody, and management of public funds or assets,
in addition to the fact that these do not integrate the structure for the execution of the budget of
expenses, aspects that allow us to affirm that the officials assigned to those
internal fiscal control bodies are not required to provide the guarantee to which
it refers to the cited article 161 of the Organic Law of Administration
Public Sector Financing, and 52 and 53 of its Regulation on the System
Budgetary.

Memorandum 04-00-137 of March 3, 2011.

It was noted that for the financial economic exercises 201_, the officials
in charge of the reception, custody, and handling of public funds and assets
C.A Metro de Caracas did not present the corresponding legal bond before entering.
in the exercise of its functions. Regarding this, the Organic Law of Administration
The Public Sector Financial Institution in its article 161 states:

Article 161. The officials in charge of the

administration and settlement of national revenues or of the
receipt, custody and handling of public funds or assets,
they will provide a bond before starting to exercise their functions, in
the amount and form determined by the Regulations of this Decree
with Rank, Value, and Strength of Law.

The guarantee is established to answer for the amounts and assets.

that those officials handle and the damages they cause to
public heritage due to failure to comply with their duties or due to
negligence, imprudence, incompetence or intent in the performance of their
functions.

Under no circumstances may the affected public entity oppose the

exclusion of the assets of the responsible official.

For their part, articles 51 and 52 of Regulation No. 1 of the Organic Law of the
Financial Administration of the Public Sector, regarding the Budgetary System,
establish

Article 51. The appointment of the officials responsible for

the managing units that are part of the structure for the
financial execution of the expenditure budget will be carried out by
the highest authority of the corresponding body and published in the
Official Gazette of the Bolivarian Republic of Venezuela.

Article 52. Before entering into the exercise of their functions

Officials referred to in the previous article shall provide a surety.
before the Internal Audit of the respective body for an amount up to
equivalent to one hundred and fifty tax units (150 U.T.)
through the establishment of guarantees granted by an institution
banking or insurance company domiciled in the country, of
recognized solvency.
Being then the transcribed article 161 of the Law in question, which establishes
broadly and generally the obligation that officials in charge have to
the administration and settlement of national revenues or the receipt, custody and
management of public funds or assets, and additionally, devices 52 and
53 of the referenced Regulation, which specifically and specially regulate the
obligation of the responsible parties of the managing units that are part of the
structure for the financial execution of the expenditure budget, to provide the
corresponding caution. Such devices therefore establish the obligation that
officials who fall under these assumptions must provide security
sufficient to answer for the amounts and goods they handle and of the
damages that could be caused to public assets due to failure to comply with
their duties or through negligence or incompetence in the performance of their functions.

Thus, Articles 52 and 53 of the previously identified Regulation are

referred only to the guarantee that must be provided by all those subjects who
intervene directly or indirectly in the administration of funds or assets
public, resulting from the designation of the various budget credits
turned to the unit under its charge or issued in favor of another unit.

These devices only refer to the officials who have the

responsibility for expenses, due to the fact that article 52 itself in reference, it
clearly and precisely states when it establishes: 'The designation of the
responsible for the Administrative Units that are part of the structure for the
financial execution of the expenditure budget ...”, which allows us to conclude that
within this structure, those who perform the functions of are not included
Internal Audit; since, the very Article 48 of the aforementioned Regulation,
establish what should be understood by that structure by stating that it is: 'the set
made up of the central administrative unit and the administrative units
deconcentrated entities that intervene in the management of budget credits.

Thus, the obligation to provide this guarantee is mandatory for

all those officials who find themselves in the factual assumptions provided
in the referred norms and, therefore, it is an indispensable condition to provide it, to the
in order to be able to invest the position and consequently exercise the functions that it
competent.

The officials in charge of the reception, custody, and management of funds and assets
public of the C.A Metro de Caracas did not present the respective legal bond,
due to weaknesses in internal control, in relation to conditions and requirements
previous requirements that must be met by officials who administer, manage, and safeguard
public funds and assets; which could result in a lack of availability
with the guarantees provided that support the replacement of the managed resources
in case of any eventuality.
Therefore, this Internal Audit, in exercising its functions, recommends to the Board
The directive of the C.A Metro de Caracas must ensure that the officials
responsible for the administration, management, and custody of the entity's resources,
present the necessary surety before starting the exercise of their functions and the
that are already performing the function of administration and custody of funds
and public goods, must undertake the necessary actions to constitute the
caution, in order to guarantee the amounts and assets they manage before a
eventual non-compliance.