MANILA, Philippines—The Supreme Court has denied a plea by the Office of the Ombudsman to reinstate its order dismissing from service a high-ranking official of the Government Service Insurance System for entering into a transaction where the government stands to lose $9.3 million.

The high court affirmed the Court of Appeals ruling that reduced the penalty meted on GSIS Senior Vice President J. Fernando Campaña to one year suspension without pay in connection with the Ombudsman’s finding that he was liable for grave misconduct.

“Considering respondent Campaña’s length of service of thirty-four years, his unblemished record in the past and the fact that this is his first offense, the mitigation of his penalty from dismissal to the penalty of suspension from office without pay for one (1) year is in accord with law and jurisprudence,” it said in an Aug. 20 ruling penned by Justice Minita Chico-Nazario.

The Fact Finding and Intelligence Bureau of the Office of the Ombudsman earlier found that Campaña had shown manifest partiality, evident bad faith or gross negligence when he had issued a surety bond to Ecobel Land Incorporated, with the bond later turning out to be undeserved.

The bureau said the GSIS was on the losing end of the transaction because the bond was issued without ensuring the authenticity of the title to the collateral posted by Ecobel. Since the title turned out to be spurious, the bureau said the government stands to lose $9.3 million without the chance of recovering it by foreclosing the property.

The Ombudsman subsequently found him liable for gross neglect of duty, inefficiency and incompetence in the performance of his official duties.

But it later modified its findings and found him guilty of grave misconduct and ordered his dismissal from service.

Campaña then questioned the findings before the Court of Appeals, which upheld his guilt but reduced the penalty imposed on him to one year suspension without pay in light of his 34 years of unblemished record.

In its decision, the tribunal agreed with the appellate court and said an official’s length of service in government could be a mitigating factor.

It added that the high court had, in past cases imposing penalties on government officials, considered favorably his lack of administrative charges in previous years and refrained from meting out the penalty of dismissal.