The prime minister's office may have scrapped receipts for expenses paid with secret Cabinet Secretariat funds that a former Foreign Ministry diplomat at the center of an embezzlement scandal received from the office, government sources said Sunday.

The office may not have shown the receipts to the government's Board of Audit, despite rules stipulating that it must, in principle, submit to the board all receipts or documents related to spending of those funds, the sources said.

It was also found that the prime minister's office threw away related receipts despite government rules stating they must be kept for about five years.

The office has claimed that it has nothing to do with the embezzlement scandal, which is currently centered on one official, Katsutoshi Matsuo. Matsuo allegedly bought racehorses after depositing about 560 million yen worth of clandestine diplomacy funds into personal bank accounts between 1993 and 1999.

In principle, all receipts on the use of the Cabinet Secretariat's funds are to be submitted to the board. But the government ignores that rule when it is using the money to pay people who provide information to the state.

Such receipts, however, must be presented during annual board inspections.

A former senior Cabinet Secretariat official told Kyodo News that all receipts are normally disposed of once a senior Cabinet official approves documents on them, despite the Board of Audit's five-year rule.

The secretariat can pass Board of Audit inspections only with a book showing how much it gets and spends, the official said.

On the other hand, sources at the prime minister's office said several senior officials, including the chief Cabinet secretary, check documents on the use of clandestine funds.

But the office has no way of checking whether the Foreign Ministry padded requests on secret fund expenses, the sources said.