A-37013, JULY 3, 1931, 11 COMP. GEN. 7

A-37013: Jul 3, 1931

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DEALS DIRECTLY BY CORRESPONDENCE OR OTHERWISE WITH THE PARTICULAR PERSON TO WHOM THE CHECK IS ISSUED AND DELIVERED. IS NOT APPLICABLE WHEN THE PERSON. 1931: REFERENCE IS MADE TO YOUR LETTER. IS APPLICABLE THERETO AND. THE CHECKS INVOLVED ARE AS FOLLOWS: CHART CHECK NO. THAT THE APPLICATION WAS THEN SENT TO WASHINGTON AND THEREAFTER THE CHECKS IN QUESTION WERE MAILED BY THE VETERANS' BUREAU TO THE EXCHANGE STREET ADDRESS. THAT THE CHECKS WERE INDORSED IN THE NAME GIVEN IN THE BODY THEREOF AND CASHED AT OR DEPOSITED IN THE CAROLINA NATIONAL BANK. THE CIRCUMSTANCES UNDER WHICH THE CHECKS WERE CASHED ARE NOT DISCLOSED. THE PAYEE WAS INFORMED BY THE RED CROSS THAT THE CHECKS HAD BEEN SENT TO THE EXCHANGE STREET ADDRESS AND HAD BEEN NEGOTIATED.

A-37013, JULY 3, 1931, 11 COMP. GEN. 7

CHECKS - FORGED INDORSEMENTS - RECLAMATION THE GENERAL RULE THAT WHEN THE GOVERNMENT, IN ISSUING AND DELIVERING A CHECK, DEALS DIRECTLY BY CORRESPONDENCE OR OTHERWISE WITH THE PARTICULAR PERSON TO WHOM THE CHECK IS ISSUED AND DELIVERED, THOUGH DECEIVED AS TO HIS IDENTITY, RECLAMATION MAY NOT BE EFFECTED FROM THE INDORSER WHO ACCEPTED THE CHECK FROM SUCH PERSON FOR VALUE WITHOUT NOTICE OF HIS LACK OF TITLE TO THE CHECK, IS NOT APPLICABLE WHEN THE PERSON, A MAN, REPRESENTS HIMSELF TO BE A WOMAN AND RECEIVES AND CASHES CHECKS DRAWN IN THE NAME OF A FEMALE PAYEE.

COMPTROLLER GENERAL MCCARL TO THE TREASURER OF THE UNITED STATES, JULY 3, 1931:

REFERENCE IS MADE TO YOUR LETTER, AWS:C, OF MAY 6, 1931, RETURNING 10 ADJUSTED COMPENSATION CHECKS, EACH IN THE AMOUNT OF $14.90, IN FAVOR OF ANNIE GEE DIXON, AND REQUESTING TO BE ADVISED WHETHER THE DECISION IN THE PHILIP V. WALTERS CASE, A-29959, IS APPLICABLE THERETO AND, IF SO, WHETHER RECLAMATION MAY BE ABANDONED. THE CHECKS INVOLVED ARE AS FOLLOWS:

CHART

CHECK NO. DATE CHECK NO. DATE

545760 ---- OCTOBER 1, 1925. 492559 ---- JANUARY 1, 1927.

580553 ---- JANUARY 1, 1926. 565956 ---- APRIL 1, 1927.

624791 ---- APRIL 1, 1926. 639299 ---- JULY 1, 1927.

683648 ---- JULY 1, 1926. 712130 ---- OCTOBER 1, 1927.

427066 ---- OCTOBER 1, 1926. 740944 ---- JANUARY 1, 1928.

IT APPEARS FROM THE SECRET SERVICE OPERATIVE'S REPORT AND OTHER FACTS OF RECORD THAT THE BROTHER-IN-LAW OF THE PAYEE OF THE LISTED CHECKS, A. W. DIXON, OR ALFRED W. DICKSON, A NEGRO, OF DARLINGTON, S.C., AGREED, IF THE PAYEE WOULD GIVE HIM THE DISCHARGE CERTIFICATE OF HER DECEASED SON, TO FILE CLAIM FOR HER FOR ADJUSTED COMPENSATION AS A DEPENDENT MOTHER UNDER THE WORLD WAR ADJUSTED COMPENSATION ACT; THAT THE PAYEE GAVE HIM THE DISCHARGE CERTIFICATE AND HE SECURED AN APPLICATION BLANK FROM THE RED CROSS AT DARLINGTON; THAT IN EXECUTING THE APPLICATION DIXON USED HIS OWN FINGER PRINTS INSTEAD OF THE PAYEE S, MADE HER MARK, AND GAVE HIS OWN ADDRESS AT 139 EXCHANGE STREET, DARLINGTON, INSTEAD OF THE ADDRESS OF THE PAYEE; THAT THE APPLICATION WAS THEN SENT TO WASHINGTON AND THEREAFTER THE CHECKS IN QUESTION WERE MAILED BY THE VETERANS' BUREAU TO THE EXCHANGE STREET ADDRESS; AND THAT THE CHECKS WERE INDORSED IN THE NAME GIVEN IN THE BODY THEREOF AND CASHED AT OR DEPOSITED IN THE CAROLINA NATIONAL BANK. CHECKS NOS. 492559 AND 683648 BORE, ALSO, THE INDORSEMENT OF A. W. DIXON. THE CIRCUMSTANCES UNDER WHICH THE CHECKS WERE CASHED ARE NOT DISCLOSED.

THE PAYEE HAS ALLEGED THAT WHENEVER SHE INQUIRED OF DIXON WHETHER ANY CHECKS HAD BEEN RECEIVED, HE ALWAYS TOLD HER HE "COULDN-T GET ANY HEARING FROM WASHINGTON.' SUBSEQUENTLY, THE PAYEE WAS INFORMED BY THE RED CROSS THAT THE CHECKS HAD BEEN SENT TO THE EXCHANGE STREET ADDRESS AND HAD BEEN NEGOTIATED. WHILE THE PAYEE INFORMED THE SECRET SERVICE OPERATIVE THAT SHE HAD NEVER AUTHORIZED DIXON TO INDORSE OR CASH THE CHECKS, DIXON, IN A SWORN AFFIDAVIT, STATED THAT THE CHECKS WERE INDORSED AND CASHED AT THE DIRECTION OF THE PAYEE. HOWEVER, HE PAID THE PAYEE $30 AS PARTIAL RESTITUTION OF THE AMOUNTS APPROPRIATED BY HIM, AND ON MAY 31, 1930, WAS ARRESTED, ARRAIGNED BEFORE THE UNITED STATES COMMISSIONER AT FLORENCE, S.C., WAIVED PRELIMINARY HEARING, PLEAD GUILTY, AND WAS HELD FOR THE ACTION OF THE GRAND JURY. HE WAS INDICTED AT AIKEN, S.C., DECEMBER 1, 1930, PLEAD GUILTY AND WAS SENTENCED TO SERVE FOUR MONTHS IN THE SUMTER COUNTY JAIL.

NOTWITHSTANDING THE FACT THAT A. W. DIXON PLEAD GUILTY TO THE CHARGE OF FORGING THE CHECKS, THERE APPEARS TO BE NO RESEMBLANCE WHATEVER BETWEEN THE HANDWRITING IN HIS SIGNATURE AS IT APPEARS AS SECOND INDORSER ON CHECKS NOS. 492559 AND 683648 AND THE HAND-WRITING IN THE INDORSEMENT OF THE NAME OF ANNIE GEE DIXON ON ALL OF THE CHECKS.

INASMUCH AS IN THE INSTANT CASE THE VETERANS' BUREAU DEALT DIRECTLY WITH THE FORGER, YOU REQUEST ADVICE WHETHER THE RULE AS ANNOUNCED IN DECISION OF JANUARY 16, 1930, A-29959, IN THE WALTERS CASE, TO THE EFFECT THAT WHERE THE GOVERNMENT DEALS DIRECTLY WITH A PARTICULAR PERSON TO WHOM A CHECK IS ISSUED AND DELIVERED RECLAMATION CAN NOT BE EFFECTED FROM THE INDORSER, IS APPLICABLE TO THE FACTS HERE INVOLVED. IN THE WALTERS CASE, THE PERSON WHO RECEIVED AND CASHED THE CHECK ACTUALLY ASSUMED AND WAS KNOWN BY THE NAME OF THE RIGHTFUL PAYEE OF THE CHECKS, WHEREAS IN THE PRESENT CASE WHILE THE PERSON WHO CASHED THE CHECKS HAD USED DECEPTION IN GETTING THE VETERANS' BUREAU TO ISSUE THEM AND SEND THEM TO HIS ADDRESS THEY WERE ISSUED AND SENT IN THE NAME OF THE RIGHTFUL PAYEE WHO WAS A WOMAN, THE ACTION OF THE VETERANS' BUREAU IN PERMITTING THE CHECKS TO GET INTO THE POSSESSION OF A. W. DIXON, A MAN, DID NOT RELIEVE THE BANK OF ITS LIABILITY IN CASHING THE CHECKS ON THE FORGED INDORSEMENT OF ANNIE GEE DIXON, THERE BEING NO REPRESENTATION MADE TO THE BANK NOR REASON FOR THE BANK TO BELIEVE THAT THE A. W. DIXON (A MAN), WHO HAD OBTAINED POSSESSION OF THE CHECKS AND WHO PRESENTED THEM FOR CASHING, WAS THE PAYEE NAMED IN THE CHECKS, ANNIE GEE DIXON (A WOMAN). IT IS CLEARLY ESTABLISHED THAT THE RIGHTFUL PAYEE OF THE CHECKS DID NOT INDORSE THEM, THAT HER NAME WAS FORGED THEREON, AND THAT THE INDORSING BANKS FAILED TO SECURE THE GENUINE INDORSEMENT OF THE PAYEE OF SAID CHECKS OR THE PERSON DULY AUTHORIZED TO INDORSE THE CHECKS ON HER BEHALF. ALL PRIOR INDORSEMENTS ARE GUARANTEED BY THE INDORSING BANKS AND THE TREASURY DEPARTMENT SHOULD EFFECT RECLAMATION OF THE PROCEEDS OF THE CHECKS TO THE EXTENT OF $119, THE PAYEE HAVING ADMITTED RECEIPT OF $30 FROM A. W. DIXON AS PARTIAL RESTITUTION OF THE AMOUNT INVOLVED.