A-22341, MAY 8, 1928, 7 COMP. GEN. 706

A-22341: May 8, 1928

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ALL POSTMASTERS AND ACTING POSTMASTERS AT DIRECT AND CENTRAL ACCOUNTING OFFICES WILL BE REQUIRED TO SUBMIT UNDER EACH BOND SEPARATE STAMP. SUCH OFFICIALS AT DISTRICT POST OFFICES WILL BE REQUIRED TO SUBMIT UNDER EACH BOND SEPARATE COMBINED POSTAL AND MONEY ORDER ACCOUNTS. THE AMOUNT OF POSTAGE-STAMPED PAPER ON HAND AT THE CLOSE OF THE FIRST STAMP ACCOUNT WILL BE CHARGED IN THE SECOND STAMP ACCOUNT. OR COMBINED ACCOUNTS WILL BE EITHER DEPOSITED OR CHARGED IN THE SECOND ACCOUNTS. ANY BALANCES DUE POSTMASTERS ON THE FIRST ACCOUNTS WILL BE CREDITED IN THE SECOND ACCOUNTS. THERE IS FOR CONSIDERATION THE LEGALITY AND PROPRIETY OF THE LONG-EXISTING PRACTICE. MORE THAN ONE FIDELITY BOND IS REQUIRED AND ACCEPTED BY THE POSTMASTER GENERAL.

A-22341, MAY 8, 1928, 7 COMP. GEN. 706

POSTMASTERS - ACCOUNTING UNDER MORE THAN ONE BOND FOR PERIODS ON AND AFTER JULY 1, 1928, ALL POSTMASTERS AND ACTING POSTMASTERS AT DIRECT AND CENTRAL ACCOUNTING OFFICES WILL BE REQUIRED TO SUBMIT UNDER EACH BOND SEPARATE STAMP, POSTAL, AND MONEY ORDER ACCOUNTS, AND SUCH OFFICIALS AT DISTRICT POST OFFICES WILL BE REQUIRED TO SUBMIT UNDER EACH BOND SEPARATE COMBINED POSTAL AND MONEY ORDER ACCOUNTS. THE AMOUNT OF POSTAGE-STAMPED PAPER ON HAND AT THE CLOSE OF THE FIRST STAMP ACCOUNT WILL BE CHARGED IN THE SECOND STAMP ACCOUNT. ANY BALANCE DUE THE UNITED STATES ON THE FIRST POSTAL, MONEY ORDER, OR COMBINED ACCOUNTS WILL BE EITHER DEPOSITED OR CHARGED IN THE SECOND ACCOUNTS. ANY BALANCES DUE POSTMASTERS ON THE FIRST ACCOUNTS WILL BE CREDITED IN THE SECOND ACCOUNTS.

COMPTROLLER GENERAL MCCARL TO THE POSTMASTER GENERAL, MAY 8, 1928:

IN THE AUDIT OF POSTAL ACCOUNTS, THERE IS FOR CONSIDERATION THE LEGALITY AND PROPRIETY OF THE LONG-EXISTING PRACTICE, UNDER SECTION 243, POSTAL LAWS AND REGULATIONS, 1924, OF RENDERING ACCOUNTS BY POSTMASTERS AND ACTING POSTMASTERS, WHERE, FOR ANY REASON, MORE THAN ONE FIDELITY BOND IS REQUIRED AND ACCEPTED BY THE POSTMASTER GENERAL.

SECTION 243 OF THE POSTAL LAWS AND REGULATIONS, 1924, PROVIDES AS FOLLOWS:

THE EXECUTION OF A NEW BOND SHALL NOT IN ANY WAY CHANGE THE MANNER OR TIME OF RENDERING THE QUARTERLY RETURN. THE SURETIES ON THE NEW BOND ARE RESPONSIBLE FROM THE DATE THE BOND IS ACCEPTED BY THE POSTMASTER GENERAL, THE OLD BOND TO RUN TO END OF QUARTER.

THERE ARE FOR CONSIDERATION FOUR GENERAL CLASSES OF CASES WHERE MORE THAN ONE FIDELITY BOND MAY BE AUTHORIZED OR REQUIRED DURING A QUARTER NOW COVERED BY THE SAME POSTAL ACCOUNT, AS FOLLOWS:

(1) A CHANGE DURING A QUARTER IN THE LEGALLY APPOINTED POSTMASTER WITHOUT ANY INTERIM, INCLUDING CASES WHERE THE FORMER POSTMASTER HOLDS OVER UNTIL HIS SUCCESSOR ENTERS UPON DUTY. SEE SECTION 3834, REVISED STATUTES, AS AMENDED BY THE ACT OF MARCH 1, 1909, 35 STAT. 670, AND THE ACT OF JUNE 10, 1921, 42 STAT. 24; ALSO SECTION 3836, REVISED STATUTES.

(2) THE TEMPORARY APPOINTMENT DURING A QUARTER OF AN ACTING POSTMASTER IN THE EVENT OF A VACANCY CAUSED BY THE DEATH, RESIGNATION, OR REMOVAL OF THE POSTMASTER AND PRIOR TO THE APPOINTMENT OF A NEW POSTMASTER. SEE SECTION 3836, REVISED STATUTES, AS AMENDED BY THE ACT OF MARCH 1, 1921, 41 STAT. 1151, AND THE ACT OF JUNE 10, 1921, 42 STAT. 24. REFERENCE IS MADE TO THE PENDING CASE OF THE POST OFFICE AT HIALEAH, FLA.

(3) RENEWAL OF BONDS DURING THE QUARTER. SEE ACT OF MARCH 2, 1895, 28 STAT. 810, AS AMENDED BY THE ACT OF MARCH 8, 1928, 45 STAT. 247. SEE ALSO IN THIS CONNECTION 7 COMP. GEN. 43.

(4)THE FURNISHING OF A NEW BOND UPON THE REQUEST OF THE POSTMASTER, THE SURETY, OR THE POSTMASTER GENERAL UNDER SECTION 3837, REVISED STATUTES, AS AMENDED BY THE ACT OF MARCH 3, 1905, 33 STAT. 1259. REFERENCE IS MADE TO THE PENDING CASE OF THE POST OFFICE AT CREECH, KY. SEE SENATE BILL 2335, SEVENTIETH CONGRESS, FOR RELIEF OF THE SURETY, A REPORT ON WHICH WAS MADE BY THIS OFFICE UNDER DATE OF JANUARY 25, 1928, A-21321.

IN CLASS (1) LIABILITY UNDER THE OLD BOND CEASES AND UNDER THE NEW BOND BEGINS UPON THE CHANGE IN POSTMASTERS, THAT IS, WHEN THE NEW POSTMASTER ENTERS UPON HIS DUTIES. IN CLASS (2) LIABILITY ATTACHES UNDER THE BOND OF THE ACTING POSTMASTER WHEN HE ENTERS UPON DUTY. IN CLASS (3) THERE IS TO BE CONSIDERED A NEW BOND, FOR ACCOUNTING PURPOSES, UPON RENEWAL, WHEN THERE IS A PERSONAL SURETY, RATHER THAN A CORPORATE SURETY, UNDER THE ACT OF MARCH 3, 1895, SUPRA, THE AMENDATORY ACT OF 1928 APPLYING ONLY TO CORPORATE SURETIES. ALSO, THERE IS TO BE CONSIDERED A NEW BOND WHEN THERE IS A CHANGE, UPON RENEWAL, IN THE CORPORATE SURETY OR ANY OF THE TERMS OF THE BOND. AS TO THESE FIRST THREE CLASSES, THE CHANGE IN LIABILITY OR IN THE BOND MAY OCCUR AT ANY TIME DURING THE QUARTER, AND THE LIABILITY UNDER THE OLD BOND DOES NOT ALWAYS CONTINUE UNTIL THE END OF THE QUARTER.

IN CLASS (4), THE STATUTE SPECIFICALLY PROVIDES THAT THE OLD SURETY IS LIABLE UNTIL THE CLOSE OF THE QUARTER IN WHICH THE NEW BOND IS ACCEPTED AND THE SURETY UNDER THE NEW BOND MAY BE HELD LIABLE FROM THE EFFECTIVE DATE THEREOF, VIZ, UPON THE DATE OF ACCEPTANCE BY THE POSTMASTER GENERAL. SEE UNITED STATES V. LE BARON, 19 HOW. 73. THUS, IT WILL BE SEEN THAT ONLY AS TO CLASS (4) MAY IT BE CONSIDERED THAT THE TERMS OF SECTION 243, POSTAL LAWS AND REGULATIONS, 1924, AND THE LONG EXISTING PRACTICE THEREUNDER HAVE BEEN JUSTIFIED TO A CERTAIN EXTENT. SEE SECTION 3835, REVISED STATUTES, AND ACT OF FEBRUARY 4, 1879, 20 STAT. 281; UNITED STATES V. HONSMAN ET AL., 70 FED.REP. 581. IN THIS CLASS IT HAS, PERHAPS, NOT BEEN ABSOLUTELY NECESSARY UNDER THE LAW TO REQUIRE A SEPARATE ACCOUNTING UNDER EACH BOND IN FORCE DURING A QUARTER, FOR THE REASON THAT THE GOVERNMENT MIGHT BE CONSIDERED AS HAVING BEEN DOUBLY PROTECTED FROM THE EFFECTIVE DATE OF THE NEW BOND UNTIL THE END OF THE QUARTER. BUT EVEN AS TO THIS CLASS, AS WELL AS TO THE OTHER CLASSES, THIS OFFICE HAS EXPERIENCED CONSIDERABLE DIFFICULTY, AND AT TIMES HAS FOUND IT IMPOSSIBLE, TO DETERMINE UNDER WHICH OF THE TWO BONDS A SHORTAGE IN THE QUARTERLY ACCOUNTS SHOULD BE CHARGED.

AS TO ALL CLASSES OF CASES, EXCEPT THOSE DESCRIBED UNDER CLASS (4), THERE HAS BEEN NO BASIS OF LAW FOR THE APPLICATION OF THE TERMS OF SECTION 243, POSTAL LAWS AND REGULATIONS, OR THE PRACTICE OF DISREGARDING A CHANGE IN THE FIDELITY BOND OF POSTMASTERS AND ACTING POSTMASTERS IN RENDERING THE QUARTERLY ACCOUNTS. IN THIS CONNECTION, THERE WOULD APPEAR TO BE NO MATERIAL DIFFERENCE BETWEEN THE RENDERING OF ACCOUNTS BY THE POSTAL OFFICERS AND EMPLOYEES AND THE DISBURSING OFFICERS OF THE GOVERNMENT GENERALLY, WITH RESPECT TO WHICH A SEPARATE ACCOUNTING UPON A CHANGE IN BOND IS REQUIRED. SEE 6 COMP. GEN. 290 AND CASES THEREIN CITED.

THE MATTER IS BELIEVED TO BE OF SUCH IMPORTANCE TO THE GOVERNMENT--- PARTICULARLY IN THE MATTER OF ENABLING THIS OFFICE TO BE IN A POSITION TO SHOW IN ALL CASES THE STATUS OF A POSTMASTER'S ACCOUNTS UNDER DIFFERENT BONDS--- AS TO REQUIRE A CHANGE IN THE EXISTING PRACTICE WITH RESPECT TO ALL CLASSES OF CASES INCLUDING THOSE DESCRIBED UNDER CLASS (4).

ACCORDINGLY, FOR PERIODS ON AND AFTER JULY 1, 1928, ALL POSTMASTERS AND ACTING POSTMASTERS AT DIRECT AND CENTRAL ACCOUNTING OFFICES WILL BE REQUIRED TO SUBMIT UNDER EACH BOND SEPARATE STAMP, POSTAL, AND MONEY ORDER ACCOUNTS, AND POSTMASTERS AND ACTING POSTMASTERS AT DISTRICT POST OFFICES WILL BE REQUIRED TO SUBMIT UNDER EACH BOND SEPARATE COMBINED POSTAL AND MONEY ORDER ACCOUNTS. THE AMOUNT OF POSTAGE STAMPED PAPER ON HAND AT THE CLOSE OF THE FIRST STAMP ACCOUNT WILL BE CHARGED IN THE SECOND STAMP ACCOUNT. ANY BALANCE DUE TO THE UNITED STATES ON THE FIRST POSTAL, MONEY ORDER, OR COMBINED ACCOUNTS, WILL BE EITHER DEPOSITED OR CHARGED IN THE SECOND ACCOUNTS. ANY BALANCES DUE TO POSTMASTERS ON THE FIRST ACCOUNTS WILL BE CREDITED IN THE SECOND ACCOUNTS. IT IS TO BE UNDERSTOOD, OF COURSE, THAT THE RENEWAL OF A BOND UNDER THE AMENDATORY ACT OF MARCH 2, 1928, SUPRA, DOES NOT REQUIRE A SEPARATE ACCOUNTING.

SECTION 243, POSTAL LAWS AND REGULATIONS, SHOULD BE AMENDED ACCORDINGLY.