B-213824, JUL 2, 1984, OFFICE OF GENERAL COUNSEL

B-213824, JUL 2, 1984, OFFICE OF GENERAL COUNSEL

ACCOUNTABLE OFFICERS - RELIEF - DENIAL - LACK OF EVIDENCE DIGEST: 1. THE GENERAL ACCOUNTING OFFICE DENIES RELIEF WHEN THE RECORD PROVIDES INSUFFICIENT EVIDENCE TO SUPPORT A DETERMINATION THAT THE DISBURSING OFFICIAL ACTED WITHIN THE BOUNDS OF DUE CARE, AS ESTABLISHED BY NAVY PROCEDURES IN PROCESSING FRAUDULENT TRAVEL CLAIMS. ACCOUNTABLE OFFICERS - RELIEF - DEBT COLLECTION - DILIGENCE IN PURSUING 2. THE RELIEF REQUEST MUST HAVE EVIDENCE THAT DILIGENT COLLECTION ACTION HAS OR IS BEING PURSUED BEFORE THE GENERAL ACCOUNTING OFFICE WILL GRANT RELIEF UNDER 31 U.S.C. 3527 (C). ACCOUNTABLE OFFICERS - RELIEF - OFFICIALS REQUIRING RELIEF RELIEF SHOULD BE REQUESTED FOR ALL PERSONS WITH RESPONSIBILITY FOR OR CUSTODY OF FUNDS DURING THE RELEVANT STAGES OF THE QUESTIONED TRANSACTION.

THE HONORABLE JOHN S. HERRINGTON ASSISTANT SECRETARY OF THE NAVY MANPOWER AND RESERVE AFFAIRS DEPARTMENT OF THE NAVY

DEAR MR. HERRINGTON:

THIS REPLIES TO YOUR REQUEST THAT RELIEF BE GRANTED TO MRS. ESTHER T. SCHULTZ, DISBURSING OFFICER, PERSONNEL SUPPORT ACTIVITY, JACKSONVILLE FLORIDA, UNDER THE PROVISION OF 31 U.S.C. SEC. 3527(C) (1983), FOR THE IMPROPER PAYMENT OF FRAUDULENT TRAVEL CLAIMS IN THE AMOUNT OF $1,118.88. ALTHOUGH THE REQUEST RECITES THE REQUIRED FINDING THAT THE IMPROPER PAYMENT WAS NOT THE RESULT OF BAD FAITH OR LACK OF DUE CARE ON THE PART OF MRS. SCHULTZ, WE DO NOT HAVE SUFFICIENT INFORMATION FROM YOUR LETTER TO CONCUR IN THIS DETERMINATION. CONSEQUENTLY, WE ARE UNABLE AT THIS TIME TO RELIEVE MRS. SCHULTZ OF LIABILITY. ADDITIONALLY, THE SUBMISSION CONTAINS NO EVIDENCE THAT DILIGENT COLLECTION ACTION HAS OR IS BEING PURSUED. VIEW OF OUR DECISION IN 62 COMP.GEN. 476 (1983) EFFECTIVE COLLECTION ACTION IS NECESSARY BEFORE OUR OFFICE WILL GRANT RELIEF.

ACCORDING TO THE INFORMATION PROVIDED, THE PAYMENT OF A TRAVEL ADVANCE WAS MADE TO MR. TORIS E. LOUIE, ALIAS LTJG DAN R. MOENING. IT APPEARS THAT MR. LOUIE PRESENTED AN APPARENTLY VALID NAVY IDENTIFICATION CARD AND ORIGINAL TEMPORARY ADDITIONAL DUTY ORDERS FOR IDENTIFICATION. AFTER PAYMENT WAS MADE A DISCREPANCY WAS FOUND. FURTHER INVESTIGATION REVEALED THAT LTJG MOENING WAS A FICTITIOUS NAME AND THAT THE ORDERS WERE INVALID. SUBSEQUENTLY, MR. LOUIE WAS APPREHENDED AND CONVICTED ON FORGERY CHARGES. IN ADDITION TO THE FORGERY OF TRAVEL ORDERS AT ISSUE HERE, MR. LOUIE HAD SUCCESSFULLY NEGOTIATED SEVERAL OTHER FRAUDULENT TRAVEL CLAIMS AT VARIOUS NAVAL AND AIR FORCE FACILITIES FOR AMOUNTS TOTALING OVER $5,000. MR. LOUIE WAS REDUCED IN RANK, RECEIVED A DISHONORABLE DISCHARGE, AND WAS SENTENCED TO 1 YEAR CONFINEMENT. BASED ON THESE FACTS, YOU HAVE DETERMINED THAT THE IMPROPER PAYMENT WAS NOT THE RESULT OF BAD FAITH OR LACK OF REASONABLE CARE BY MRS. SCHULTZ.

THIS OFFICE HAS AUTHORITY UNDER 31 U.S.C. SEC. 3527(C) TO RELIEVE A DISBURSING OFFICER FROM LIABILITY FOR A DEFICIENCY RESULTING FROM AN IMPROPER PAYMENT UPON DETERMINING "THAT THE PAYMENT WAS NOT THE RESULT OF BAD FAITH OR LACK OF REASONABLE CARE BY THE OFFICIAL." WE GRANT RELIEF WHEN THE RECORD INDICATES THAT AGENCY PERSONNEL ACTED WITHIN THE BOUNDS OF DUE CARE AS ESTABLISHED BY APPLICABLE REGULATIONS AND THAT THERE IS NO EVIDENCE OF BAD FAITH ON THE PART OF THE ACCOUNTABLE OFFICER. SEE 62 COMP.GEN. 476 (1983).

THE RECORD IN THIS CASE DOES NOT PROVIDE US WITH ENOUGH EVIDENCE TO DETERMINE IF MRS. SCHULTZ EXERCISED REASONABLE CARE IN PROCESSING THE FRAUDULENT TRAVEL CLAIMS. WHILE WE WERE INFORMED THAT MR. LOUIE PRESENTED SEEMINGLY VALID IDENTIFICATION AND DOCUMENTS TO AUTHORIZE A PAYMENT, WE WERE NOT TOLD WHAT THE STANDARD OPERATING PROCEDURES WERE IN PROCESSING SUCH A CLAIM AND WHETHER THESE PROCEDURES WERE FOLLOWED. NOR ARE WE GIVEN INFORMATION ON WHAT DISCREPANCY FINALLY LED TO THE DETECTION OF THE FRAUD AND WHY IT SHOULD NOT HAVE BEEN DISCOVERED PRIOR TO PAYMENT. WITHOUT THIS INFORMATION, WE ARE UNABLE TO GRANT RELIEF.

WE ALSO NOTE THAT IN 62 COMP.GEN. 476 (1983), WE GAVE NOTICE THAT WE WOULD DENY RELIEF UNDER 31 U.S.C. SEC. 3527(C) UNLESS THE SUBMISSION CONTAINS EVIDENCE THAT DILIGENT COLLECTION ACTION HAS OR IS BEING PURSUED. WHILE YOUR SUBMISSION PREDATES THIS DECISION, IN ORDER TO SHOW THAT SUCH COLLECTION EFFORT HAS BEEN MADE, ANY FUTURE RELIEF REQUEST IN THIS CASE MUST DEMONSTRATE COMPLIANCE WITH THE FEDERAL CLAIMS COLLECTION STANDARDS ISSUED JOINTLY BY THE GENERAL ACCOUNTING OFFICE (GAO) AND THE DEPARTMENT OF JUSTICE. 4 C.F.R. PARTS 101 THROUGH 105. THERE IS NO EVIDENCE IN THE RECORD HERE TO INDICATE THAT COLLECTION EFFORTS HAVE BEEN UNDERTAKEN.

FINALLY, WE NOTE THAT THE REQUEST FOR RELIEF IS ON BEHALF OF MRS. SCHULTZ, WHO APPEARS TO BE THE DISBURSING OFFICIAL AUTHORIZING PAYMENT. AS THERE MAY BE MORE THAN ONE ACCOUNTABLE OFFICER IN A CASE, IT IS NECESSARY TO KNOW WHO HAD RESPONSIBILITY FOR OR CUSTODY OF THE FUNDS DURING THE TRANSACTION. THE PERSON WHO MADE THE ERRONEOUS OR IMPROPER PAYMENT IS FINANCIALLY LIABLE TO THE GOVERNMENT. IN ADDITION, THE PERSON IN WHOSE NAME THE ACCOUNT IS OFFICIALLY HELD AT THE TIME THE WRONGFUL PAYMENT IS MADE, MAY ALSO BE LIABLE. THEREFORE, IT IS NECESSARY TO REQUEST RELIEF FOR ALL OF THESE INDIVIDUALS, UNLESS THE AGENCY DETERMINES THAT ONE OR MORE SHOULD BE HELD LIABLE FOR THE LOSS. 62 COMP.GEN. 476 (1983).

ACCORDINGLY, BECAUSE OF THE DEFICIENCIES IN THE RELIEF REQUEST WE ARE UNABLE TO GRANT RELIEF. IF FURTHER EVIDENCE IS PRESENTED THAT SUPPORTS THE FINDINGS REQUIRED FOR RELIEF, WE WOULD BE HAPPY TO RECONSIDER THIS DECISION.