(UPDATED) The Office of the Ombudsman has ordered the dismissal of Commission on Higher Education (CHED) Executive Director Julito Vitriolo after he was found guilty of grave misconduct and gross neglect of duty.

Vitriolo allegedly failed to stop a diploma milling program and allowed the issuance of diploma of a physical education program under a suspended memorandum agreement.

At the same time, Vitriolo will be charged with graft before the Sandiganbayan.

The issue stemmed from the Physical Education program under the Pamantasan ng Lungsod ng Maynila (PLM) and National College of Physical Education (NCPE) memorandum, which was launched in 1996.

The registration of NCPE was revoked in 2003 after it failed to comply with reportorial requirements. The program was suspended in 2008.

In 2010, despite suspension, Vitriolo insisted that the PLM can still issue the student's transcripts to the program graduates of Master in Physical Education and Sports and Certificate in Physical Education "based on vested rights."

Vitriolo also allegedly failed to act on the complainant, former PLM faculty Oliver Felix's request to investigate the PLM's engagement in the diploma mill operations in 2011.

The Code of Conduct and Ethical Standards for Public Officials and Employees states this should have been acted upon within the 15-day prescribed period.

In a Joint Resolution, the Ombudsman said "Vitriolo failed to realize that such omission would result in adverse consequences to public funds spent in the implementation of a suspended PLM-NCPE MOA.

A total of 703 students also suffered financial reverses for spending time and money for an education that was worthless in the eyes of the law, it added.

In a text message, Vitriolo said he will appeal the Ombudsman's decision.

"First of all, I was surprised with the decision of the Ombudsman cause I believe there were considerations that were not taken into account. The decision is not yet final and we will definitely appeal said decision," he said.