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B-197799 L/M, JUN 19, 1980

B-197799 L/M Jun 19, 1980
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THE REQUEST WAS FORWARDED TO US BY THE ACTING CHIEF DISBURSING OFFICER. WAS INVOLVED IN THE LOSS. RELIEF IS GRANTED. THE EVIDENCE INDICATES THAT THE LOSS APPARENTLY RESULTED FROM A BURGLARY MADE POSSIBLE BY THE FAILURE OF AN EMPLOYEE TO PROPERLY LOCK THE SAFE IN WHICH THE FUNDS WERE KEPT. THE PURCHASING AND CONTRACT SECTION OF THE MEDICAL CENTER SUPPLY SERVICE MAINTAINED THE IMPREST FUND IN TWO LOCKED METAL CASH BOXES THAT WERE KEPT IN THE SECTION SAFE. ALSO KEPT IN THE SAFE WERE SUCH ITEMS AS A TAPE RECORDER. A KEY FOR THE SECTION CLOSET WHERE OFFICE CALCULATORS WERE STORED WHEN NOT IN USE. SINCE THE SAFE WAS USED TO STORE ITEMS BESIDES THE CASH BOXES. THE PRACTICE WAS TO OPEN THE SAFE IN THE MORNING AND LEAVE IT OPEN THROUGHOUT THE DAY AS LONG AS SOMEONE WAS IN THE ROOM AND LOCK IT AT THE CLOSE OF BUSINESS.

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B-197799 L/M, JUN 19, 1980

OFFICE OF GENERAL COUNSEL

MAX CLELAND, VETERANS ADMINISTRATION:

MR. CONRAD R. HOFFMAN, CONTROLLER, VETERANS ADMINISTRATION (VA), HAS REQUESTED RELIEF FROM LIABILITY FOR THE LOSS OF $535.42 ON BEHALF OF DONNA ELLISON, THE FACILITY CLASS-B-CASHIER AT THE VETERANS ADMINISTRATION MEDICAL CENTER, HINES, ILLINOIS. THE REQUEST WAS FORWARDED TO US BY THE ACTING CHIEF DISBURSING OFFICER, BUREAU OF GOVERNMENT FINANCIAL OPERATIONS, DEPARTMENT OF THE TREASURY. SINCE THE RECORD INDICATES THAT DANIEL DUDA, THE IMPREST FUND CASHIER, WAS INVOLVED IN THE LOSS, WE SHALL CONSIDER YOUR REQUEST FOR RELIEF OF LIABILITY AS COVERING THIS EMPLOYEE ALSO. FOR THE REASONS SET FORTH BELOW, RELIEF IS GRANTED.

THE EVIDENCE INDICATES THAT THE LOSS APPARENTLY RESULTED FROM A BURGLARY MADE POSSIBLE BY THE FAILURE OF AN EMPLOYEE TO PROPERLY LOCK THE SAFE IN WHICH THE FUNDS WERE KEPT. THE PURCHASING AND CONTRACT SECTION OF THE MEDICAL CENTER SUPPLY SERVICE MAINTAINED THE IMPREST FUND IN TWO LOCKED METAL CASH BOXES THAT WERE KEPT IN THE SECTION SAFE. ALSO KEPT IN THE SAFE WERE SUCH ITEMS AS A TAPE RECORDER, AUTOMOBILE TITLE CERTIFICATES, SPARE KEYS FOR ONE OF THE CENTER BUILDINGS, A KEY FOR THE SECTION CLOSET WHERE OFFICE CALCULATORS WERE STORED WHEN NOT IN USE, A BOOK OF NARCOTIC TRANSACTION FORMS, BILLS OF LADING FORMS AND A SMALL OFFICE PETTY CASH FUND. SINCE THE SAFE WAS USED TO STORE ITEMS BESIDES THE CASH BOXES, 6 EMPLOYEES HAD THE COMBINATION. THE PRACTICE WAS TO OPEN THE SAFE IN THE MORNING AND LEAVE IT OPEN THROUGHOUT THE DAY AS LONG AS SOMEONE WAS IN THE ROOM AND LOCK IT AT THE CLOSE OF BUSINESS. THE SECTION CHIEF, JAMES DRUEK, NORMALLY LOCKED THE SAFE AT NIGHT. ALL THE EMPLOYEES SHARED THE RESPONSIBILITY FOR SECURITY OF THE SAFE AND THE COMBINATION HAD NOT BEEN CHANGED FOR A PERIOD OF ABOUT TWO AND ONE HALF YEARS.

THE LOSS TOOK PLACE DURING THE FIRST WEEKEND OF DECEMBER 1979. YOUR SUBMISSION INDICATES THAT ON SATURDAY, DECEMBER 8, 1979, FROM 8 A.M., TO 4 P.M., EIGHT EMPLOYEES WORKED OVERTIME IN THE AREA WHERE THE SAFE WAS LOCATED. OF THE EIGHT EMPLOYEES WHO WORKED OVERTIME ON DECEMBER 8, THREE KNEW THE SAFE COMBINATION, INCLUDING BOTH THE IMPREST FUND CASHIER, MR. DUDA AND A FORMER IMPREST FUND CASHIER, MS. JULIA F. DWYER. THE SAFE WAS SECURED ON THE EVENING OF FRIDAY, DECEMBER 7, 1979, AND WAS ONLY OPENED ONCE BETWEEN 8 A.M., AND 4 P.M., THE FOLLOWING SATURDAY. JULIA DWYER, WHOSE ROTATIONAL ASSIGNMENT AS THE IMPREST FUND CASHIER HAD EXPIRED ON DECEMBER 3, 1979, AND THEREFORE HAD NO FURTHER RESPONSIBILITY FOR THE FUND, OPENED THE SAFE AT 8:10 A.M., ON SATURDAY, DECEMBER 8, TO OBTAIN A KEY TO UNLOCK THE CLOSET WHERE THE CALCULATORS WERE STORED. SHE APPARENTLY LATCHED THE SAFE AFTER THE KEY WAS OBTAINED, BUT WAS NOT CONSCIOUS OF SPINNING THE COMBINATION IN ORDER TO LOCK THE SAFE. DANIEL DUDA, THE NEW IMPREST FUND CASHIER, WAS ON DUTY DURING THIS TIME BUT HAD NO OCCASION TO REMOVE THE CASH BOX AND DID NOT CHECK TO SEE IF THE SAFE WAS SECURELY LOCKED BEFORE HE LEFT WORK AT 4 P.M. THE FOLLOWING MONDAY, DECEMBER 10, 1979, THE LOCKED SAFE WAS OPENED AT APPROXIMATELY 8:10 A.M., BY MR. DUDA WHO DISCOVERED THAT THE TWO LOCKED CASH BOXES CONTAINING A TOTAL OF $535.42, MOSTLY IN CONSECUTIVELY NUMBERED NEW BILLS, WERE MISSING. THERE WERE NO SIGNS OF A FORCED ENTRY INTO THE SAFE.

THE INCIDENT WAS INVESTIGATED BY A SPECIAL PANEL ESTABLISHED BY THE DIRECTOR OF THE HINES MEDICAL CENTER. A REPORT ON THE INCIDENT WAS SUBMITTED TO THE FEDERAL BUREAU OF INVESTIGATION AND THE UNITED STATES SECRET SERVICE. (APPARENTLY, THE CASE IS STILL IN AN OPEN STATUS AT THOSE AGENCIES.) THE INVESTIGATION CONCLUDED THAT THE FUNDS WERE MISSING AS A RESULT OF AN APPARENT BURGLARY WHICH OCCURRED SOMETIME BETWEEN 4 P.M., SATURDAY AND 8 A.M., MONDAY MORNING. THIS CONCLUSION WAS BASED ON THE FACT THAT TWO BUILDING MANAGEMENT EMPLOYEES WERE ARRESTED NEAR THE SECTION OFFICES FOR A DRUG RELATED VIOLATION AT NOON SUNDAY, DECEMBER 9, 1979. WHEN SEARCHED, THEY WERE FOUND TO HAVE IN THEIR POSSESSION A LARGE SUM OF MONEY CONSISTING OF CONSECUTIVELY NUMBERED ONE AND FIVE DOLLAR BILLS AND ABOUT $10 IN LOOSE CHANGE WHICH APPROXIMATED THE AMOUNT LATER FOUND TO HAVE BEEN LOST WITH THE CASH BOXES. IN ADDITION, THEY ALSO HAD IN THEIR POSSESSION SEVERAL KEYS LATER TENTATIVELY IDENTIFIED AS THE ONES KEPT IN THE SAFE. HOWEVER, AT THE TIME OF THIS INCIDENT, THE ARRESTING OFFICER WAS UNAWARE OF THE MISSING CASH BOXES.

IT SEEMS PROBABLE FROM THE RECORD THAT THESE PARTICULAR INDIVIDUALS COMMITTED THE BURGLARY. AFTER THE ARREST THESE EMPLOYEES, WHO WERE ON PROBATIONARY STATUS, DID NOT RETURN TO THEIR JOBS.

THE VETERANS ADMINISTRATION HAS DETERMINED THAT THE LOSS OCCURRED WITHOUT FAULT OR NEGLIGENCE ON THE PART OF DONNA ELLISON, THE CLASS-B CASHIER AT THE MEDICAL CENTER OR ON THE PART OF DANIEL DUDA, IMPREST FUND CASHIER.

THE GENERAL ACCOUNTING OFFICE IS AUTHORIZED TO GRANT RELIEF FROM LIABILITY TO AN ACCOUNTABLE OFFICER UPON ITS CONCURRENCE WITH DETERMINATIONS BY THE DEPARTMENT OR AGENCY HEAD THAT (1) THE LOSS OR DEFICIENCY OCCURRED WHILE THE OFFICER OR AGENT WAS ACTING IN THE DISCHARGE OF HIS OFFICIAL DUTIES, OR THAT IT OCCURRED BY REASON OF THE ACT OR OMISSION OF A SUBORDINATE OF THE OFFICER OR AGENT, AND (2) THE LOSS OR DEFICIENCY OCCURRED WITHOUT FAULT OR NEGLIGENCE ON THE PART OF THE OFFICER OR AGENT. 31 U.S.C. SEC. 82A-1 (1976).

AS A GENERAL RULE, THE DISAPPEARANCE OF FUNDS WITHOUT EXPLANATION GIVES RISE TO A PRESUMPTION OF NEGLIGENCE ON THE PART OF THE ACCOUNTABLE OFFICER. 48 COMP.GEN. 566 (1969). HOWEVER, WE HAVE RECOGNIZED ON A NUMBER OF OCCASIONS THAT THE DISAPPEARANCE OF AN ENTIRE CASH BOX INDICATES THAT THE LOSS WAS PROBABLY DUE TO THEFT. B-189896, NOVEMBER 1, 1977. THE QUESTION IN SUCH A CASE BECOMES WHETHER THE THEFT CAN BE ATTRIBUTED IN ANY WAY TO FAULT OR NEGLIGENCE ON THE PART OF THE ACCOUNTABLE OFFICER. IN THE PRESENT SITUATION, THE EVIDENCE SHOWS THAT DONNA ELLISON, THE CLASS-B- CASHIER, WAS NOT PRESENT AT THE CENTER DURING THE TIME FRAME OF THE LOSS, NOR DID SHE HAVE ANY RESPONSIBILITY FOR THE PHYSICAL SECURITY OF THE FUNDS, THIS BEING A RESPONSIBILITY SPECIFICALLY DELEGATED TO THE IMPREST FUND CASHIER, MR. DUDA, OR HIS ALTERNATE, MS. MARY CRAWFORD. ACCORDINGLY, WE CONCUR IN THE VA'S DETERMINATION THAT THERE WAS NO FAULT OR NEGLIGENCE ON MS. ELLISON'S PART AND WE RELIEVE HER OF LIABILITY FOR THE LOSS. THE PRIMARY RESPONSIBILITY FOR THE SAFETY OF THE IMPREST FUNDS RESTED ON THE SHOULDERS OF MR. DUDA, THE IMPREST FUND CASHIER. HE HAD NOT TRANSFERRED ANY PART OF HIS RESPONSIBILITY TO THE ALTERNATE CASHIER, MS. CRAWFORD, AND IN FACT HE WAS PRESENT ON THE SATURDAY OF THE WEEKEND WHEN THE LOSS OCCURRED. THE FACT THAT HE PERMITTED THE FORMER CASHIER, MS. DWYER, TO OPEN AND CLOSE THE SAFE AND THAT IT WAS MS. DWYER AND NOT HE WHO MAY NOT HAVE FULLY SECURED THE SAFE BEFORE LEAVING THE OFFICE DOES NOT ABSOLVE HIM FROM THE PRESUMPTION OF NEGLIGENCE. OF ALL THE EMPLOYEES PRESENT THAT DAY, MR. DUDA ALONE HAD THE RIGHT TO OPEN THE SAFE AND HE ALONE WAS RESPONSIBLE FOR ASSURING ITS SECURITY.

HOWEVER, WE FIND IT DIFFICULT TO DETERMINE WHETHER THE IMPREST FUND CASHIER'S NEGLIGENCE WAS THE PROXIMATE CAUSE OF THE LOSS BECAUSE THE PROCEDURES AND PRACTICES OF THE PURCHASING AND CONTRACT SECTION IN PROTECTING AND HANDLING THE IMPREST FUND WERE SERIOUSLY DEFICIENT.

THE TREASURY'S DEPARTMENT'S MANUAL OF PROCEDURES AND INSTRUCTIONS FOR CASHIERS, 1976 EDITION, CONTAINS INSTRUCTIONS FOR SAFEGUARDING FUNDS. AMONG OTHER THINGS, IT STATES THAT A CASHIER IS TO BE PROVIDED ADEQUATE FACILITIES TO WHICH ONLY HE OR SHE HAS ACCESS FOR SAFEGUARDING FUNDS, AND THAT SPECIFIC INSTRUCTIONS FOR THE PHYSICAL PROTECTION OF CASH, IN ACCORDANCE WITH INDIVIDUAL CIRCUMSTANCES, ARE TO BE INCLUDED IN AGENCY REGULATIONS. THE MANUAL ALSO PROVIDES THAT SAFE COMBINATIONS SHOULD BE CHANGED: (1) ANNUALLY; (2) WHENEVER THERE HAS BEEN A CHANGE OF CASHIERS; (3) WHEN IT HAS BEEN NECESSARY TO EFFECT ACCESS TO THE FUNDS IN THE CASE OF UNFORESEEN ABSENCE OF A CASHIER; OR (4) WHEN THE COMBINATION HAS BEEN COMPROMISED.

IT IS APPARENT THAT THE MEDICAL CENTER FAILED TO INSTITUTE THESE RATHER BASIC SAFEGUARD PROCEDURES. THE SAFE WAS USED TO STORE SECTION PROPERTY IN ADDITION TO THE CASH BOXES AND WAS LEFT OPEN WHEN THE CASH BOXES WERE NOT IN USE. SEVERAL EMPLOYEES NOT INVOLVED WITH THE FUND HAD THE COMBINATION. THE COMBINATION HAD NOT BEEN CHANGED AS SECURITY REGULATIONS REQUIRE. PROCEDURES HAD NOT BEEN ESTABLISHED TO PLACE THE RESPONSIBILITY FOR SAFE SECURITY ON INDIVIDUAL EMPLOYEES. WE THINK THAT THE LACK OF ADEQUATE SAFEGUARD PROCEDURES IN LARGE MEASURE CONTRIBUTED TO THE LOSS. WE HAVE, ON A NUMBER OF OCCASIONS, RELIEVED ACCOUNTABLE OFFICERS FROM LIABILITY FOR LOSSES WHERE A NUMBER OF PEOPLE HAD ACCESS TO THE FUNDS THROUGH KNOWLEDGE OF THE SAFE COMBINATION AND/OR PROTECTIVE FACILITIES DID NOT AFFORD ADEQUATE PROTECTION. B-191942, SEPTEMBER 12, 1979.

IT APPEARS FROM THE RECORD THAT THIS IS A SIMILAR SITUATION. WE ALSO NOTE THAT APPROPRIATE SAFEGUARD PROCEDURES HAVE BEEN ESTABLISHED WITHIN THE SECTION TO CORRECT THE DEFICIENCIES THAT CONTRIBUTED TO THE LOSS. THEREFORE GRANT RELIEF TO THE IMPREST FUND CASHIER, MR. DUDA. THE VA'S ACCOUNT MAY BE ADJUSTED AS REQUESTED.

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