A-56745, APRIL 21, 1936, 15 COMP. GEN. 923

A-56745: Apr 21, 1936

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1936: THERE WAS RETURNED TO THIS OFFICE BY THE TREASURER OF THE CORPORATION FOR PREAUDIT CONSIDERATION. THE VOUCHER WAS PREVIOUSLY SUBMITTED TO THIS OFFICE FOR PREAUDIT ON SCHEDULE NO. 271. WAS RETURNED WITHOUT CERTIFICATION BY PREAUDIT DIFFERENCE STATEMENT DATED MARCH 10. FOR REASONS AS FOLLOWS: THERE IS NO AUTHORITY FOR THE FEDERAL SAVINGS AND LOAN CORPORATION TO PAY FROM PUBLIC FUNDS THE PREMIUMS ON INDEMNITY BONDS COVERING ITS OFFICERS. THE DECISION CITED WAS ADDRESSED TO YOU AND COVERED THE SUBJECT MATTERS HERE INVOLVED. THE CORPORATION IS "AN INSTRUMENTALITY OF THE UNITED STATES" DERIVING ITS FUNDS FROM THE FEDERAL GOVERNMENT. THE GIVING OF A BOND IS IN THE NATURE OF A QUALIFICATION FOR A PARTICULAR POSITION AND THE EXPENSE OF FURNISHING SUCH BOND IS PERSONAL TO THE EMPLOYEE.

A-56745, APRIL 21, 1936, 15 COMP. GEN. 923

BONDS - PREMIUMS - GOVERNMENT OFFICERS AND EMPLOYEES THE PAYMENT FROM PUBLIC FUNDS OF PREMIUMS ON BONDS REQUIRED TO BE FURNISHED BY GOVERNMENT OFFICERS AND EMPLOYEES BEING SPECIFICALLY PROHIBITED BY STATUTE, THE ACT OF MAY 28, 1935, 49 STAT. 298, PROVIDING THAT THE FEDERAL SAVINGS AND LOAN INSURANCE CORPORATION "SHALL DETERMINE ITS NECESSARY EXPENDITURES * * * WITHOUT REGARD TO THE PROVISIONS OF ANY OTHER LAW GOVERNING THE EXPENDITURE OF PUBLIC FUNDS," CANNOT OPERATE TO PERMIT THE CHARGING OF SUCH FUNDS WITH THE COST OF BONDS REQUIRED TO BE FURNISHED BY OFFICERS AND EMPLOYEES OF SAID CORPORATION.

COMPTROLLER GENERAL MCCARL TO THE CHAIRMAN, BOARD OF TRUSTEES, FEDERAL SAVINGS AND LOAN INSURANCE CORPORATION, APRIL 21, 1936:

THERE WAS RETURNED TO THIS OFFICE BY THE TREASURER OF THE CORPORATION FOR PREAUDIT CONSIDERATION, VOUCHER NO. 415 IN FAVOR OF THE FIDELITY AND DEPOSIT COMPANY OF MARYLAND FOR $62.50, FOR PREMIUM ON SCHEDULE BOND NO. 4070623 COVERING THE TREASURER OF THE CORPORATION IN THE AMOUNT OF $25,000 TO NOVEMBER 25, 1936. THE VOUCHER WAS PREVIOUSLY SUBMITTED TO THIS OFFICE FOR PREAUDIT ON SCHEDULE NO. 271, BUT WAS RETURNED WITHOUT CERTIFICATION BY PREAUDIT DIFFERENCE STATEMENT DATED MARCH 10, 1936, FOR REASONS AS FOLLOWS:

THERE IS NO AUTHORITY FOR THE FEDERAL SAVINGS AND LOAN CORPORATION TO PAY FROM PUBLIC FUNDS THE PREMIUMS ON INDEMNITY BONDS COVERING ITS OFFICERS. (SEE DECISION A-56745, DATED AUG. 3, 1934.)

THE DECISION CITED WAS ADDRESSED TO YOU AND COVERED THE SUBJECT MATTERS HERE INVOLVED.

IN RETURNING THE VOUCHER FOR FURTHER CONSIDERATION THE TREASURER OF THE CORPORATION, IN HIS LETTER OF MARCH 14, 1936, STATED:

THE AMENDMENT TO THE NATIONAL HOUSING ACT APPROVED MAY 28, 1935, READS IN PART AS FOLLOWS: ,THE CORPORATION SHALL BE ENTITLED TO THE FREE USE OF THE UNITED STATES MAILS FOR ITS OFFICIAL BUSINESS IN THE SAME MANNER AS THE EXECUTIVE DEPARTMENTS OF THE GOVERNMENT, AND SHALL DETERMINE ITS NECESSARY EXPENDITURES UNDER THIS ACT AND THE MANNER IN WHICH THE SAME SHALL BE INCURRED, ALLOWED, AND PAID, WITHOUT REGARD TO THE PROVISIONS OF ANY OTHER LAW GOVERNING THE EXPENDITURE OF PUBLIC FUNDS.'

THE CORPORATION IS "AN INSTRUMENTALITY OF THE UNITED STATES" DERIVING ITS FUNDS FROM THE FEDERAL GOVERNMENT, AND BEING "ENTITLED TO THE FREE USE OF THE UNITED STATES MAILS FOR ITS OFFICIAL BUSINESS IN THE SAME MANNER AS THE EXECUTIVE DEPARTMENTS OF THE GOVERNMENT," AS AUTHORIZED IN THE STATUTE QUOTED IN THE LETTER, SUPRA, 49 STAT. 298, THE OFFICERS AND EMPLOYEES OF THE CORPORATION MUST BE CONSIDERED AS OFFICERS AND EMPLOYEES OF THE GOVERNMENT.

THE ACT OF AUGUST 5, 1909, 36 STAT. 125, SPECIFICALLY PROVIDES THAT- -

* * * THE UNITED STATES SHALL NOT PAY ANY PART OF THE PREMIUM OR OTHER COST OF FURNISHING A BOND REQUIRED BY LAW OR OTHERWISE OF ANY OFFICER OR EMPLOYEE OF THE UNITED STATES.

THE STATUTE, IN EXPRESS TERMS, PROHIBITS THE PAYMENT OF PREMIUMS ON BONDS OF OFFICERS AND EMPLOYEES OF THE UNITED STATES FROM PUBLIC FUNDS AND SUCH PROHIBITION OPERATES DIRECTLY UPON THE PUBLIC AGENT AS WELL AS THE PUBLIC FUNDS. (SEE 3 COMP. GEN. 190.)

THE GIVING OF A BOND IS IN THE NATURE OF A QUALIFICATION FOR A PARTICULAR POSITION AND THE EXPENSE OF FURNISHING SUCH BOND IS PERSONAL TO THE EMPLOYEE. (SEE 3 COMP. GEN. 190; 13 ID. 185, AND 14 ID. 264.) THE PROVISIONS OF SECTION 402 OF THE ACT OF JUNE 27, 1934, 48 STAT. 1256, AS AMENDED BY SECTION 22 OF THE ACT OF MAY 28, 1935, 49 STAT. 298, CANNOT OPERATE TO MAKE THE COST OF BONDS REQUIRED TO BE FURNISHED BY OFFICERS AND EMPLOYEES OF THE CORPORATION CHARGES AGAINST THE UNITED STATES, SUCH EXPENSE BEING PERSONAL TO THE OFFICER OR EMPLOYEE AND NOT AN EXPENSE NECESSARY TO THE PERFORMANCE OF ANY AUTHORIZED FUNCTION OF THE CORPORATION. CONSEQUENTLY, THE PROPOSED PAYMENT IS NOT AUTHORIZED.