A-89732, DECEMBER 2, 1937, 17 COMP. GEN. 457

A-89732: Dec 2, 1937

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

SHOULD BE APPLIED ON THE BASIS THAT THE FORMER POSTMASTER IS ENTITLED TO CREDIT FOR THE FULL AMOUNT OF RETIREMENT DEDUCTIONS MADE FROM THE CLERK'S SALARY DURING SAID POSTMASTER'S INCUMBENCY. THE PRESENT POSTMASTER IS ENTITLED TO CREDIT FOR THE REMAINDER OF THE BOND PENALTY. 1937: REFERENCE IS MADE TO LETTER OF OCTOBER 14. IT IS FELT THAT HE IS ACCOUNTABLE THEREFOR AND THE PRESENT POSTMASTER FOR THE REMAINING 57 PERCENT OF THE SHORTAGE. THE MATTER IS REFERRED TO YOU FOR YOUR OPINION: CHART TO BE CREDITED TO THE ACCOUNT OF A. 523.92 NO ACTION WILL BE TAKEN BY THIS OFFICE UNTIL RECEIPT OF YOUR REPLY. WAS SUSPENDED FROM DUTY MARCH 20. WAS DISMISSED FROM THE SERVICE APRIL 24. 500 OF THE AMOUNT CHARGED AGAINST BROWN WAS EMBEZZLED BY HIM DURING THE TERM OF OFFICE OF ALEXANDER B.

A-89732, DECEMBER 2, 1937, 17 COMP. GEN. 457

SET-OFF AND LIQUIDATION OF ACCOUNTABLE OFFICERS' INDEBTEDNESS - POSTAL CLERK'S EMBEZZLEMENT DURING TENURE OF TWO POSTMASTERS - APPLICATION OF UNPAID SALARY, RETIREMENT DEDUCTIONS AND BOND PENALTY WHERE FORMER POSTAL CLERK EMBEZZLED POSTAL SAVINGS FUNDS DURING THE TENURE OF OFFICE OF TWO POSTMASTERS, THE AMOUNT TO HIS CREDIT IN THE RETIREMENT FUND, UNPAID SALARY, AND THE PENALTY ON HIS BOND, SHOULD NOT BE APPLIED IN LIQUIDATION OF THE RESULTING CHARGES RAISED IN THE POSTMASTERS' ACCOUNTS ON A PERCENTAGE BASIS DETERMINED FROM THE AMOUNT EMBEZZLED UNDER EACH POSTMASTER, BUT SHOULD BE APPLIED ON THE BASIS THAT THE FORMER POSTMASTER IS ENTITLED TO CREDIT FOR THE FULL AMOUNT OF RETIREMENT DEDUCTIONS MADE FROM THE CLERK'S SALARY DURING SAID POSTMASTER'S INCUMBENCY, PLUS INTEREST THEREON, AND FOR ALL OF THE BOND PENALTY, OR ANY PART THEREOF NECESSARY TO LIQUIDATE THE ENTIRE CHARGE IN HIS ACCOUNTS, AND THE PRESENT POSTMASTER IS ENTITLED TO CREDIT FOR THE REMAINDER OF THE BOND PENALTY, IF ANY, PLUS THE AMOUNT OF RETIREMENT DEDUCTIONS MADE DURING HIS INCUMBENCY, WITH INTEREST THEREON, AND THE UNPAID SALARY WHICH ACCRUED DURING HIS INCUMBENCY.

ACTING COMPTROLLER GENERAL ELLIOTT TO THE POSTMASTER GENERAL, DECEMBER 2, 1937:

REFERENCE IS MADE TO LETTER OF OCTOBER 14, 1937, FROM THE ACTING THIRD ASSISTANT POSTMASTER GENERAL (2-RKD:MLB) AS FOLLOWS:

AN INQUIRY HAS BEEN RECEIVED FROM THE CHIEF INSPECTOR UNDER CASE NO. 22102-M, CONCERNING THE DISPOSITION OF THE PENALTY ON THE BOND ($2,000.00), THE ACCUMULATED RETIREMENT DEDUCTIONS ($646.30), AND UNPAID SALARY ($27.24) OF CLARENCE P. BROWN, FORMER POST OFFICE CLERK AT CLARINDA, IOWA, WHO APPARENTLY EMBEZZLED $5,800.00 POSTAL SAVINGS FUNDS.

IN VIEW OF THE STATEMENT OF INSPECTORS F. D. FLORA AND J. T. NELSON, IN PARAGRAPH 60 OF THEIR REPORT DATED MARCH 29, 1937, THAT $2,500.00 OF THIS SHORTAGE EXISTED AT THE TIME A. B. CLARK RETIRED AS POSTMASTER AT THAT OFFICE ON MAY 31, 1936, IT IS FELT THAT HE IS ACCOUNTABLE THEREFOR AND THE PRESENT POSTMASTER FOR THE REMAINING 57 PERCENT OF THE SHORTAGE, WHICH AMOUNTS TO $3,300.00.

THIS OFFICE BELIEVES THAT THE FOLLOWING ACTION SHOULD BE TAKEN IN DISPOSING OF THE COLLECTIONS MENTIONED ABOVE, AND THE MATTER IS REFERRED TO YOU FOR YOUR OPINION:

CHART

TO BE CREDITED TO THE ACCOUNT OF A. B. CLARK, FORMER POSTMASTER:

43 PERCENT OF THE PENALTY OF BROWN'S BOND ------------ $860.00

43 PERCENT OF BROWN'S CREDIT IN THE RETIREMENT FUND -- 277.91

43 PERCENT OF THE UNPAID SALARY DUE TO BROWN --------- 11.71

TOTAL ---------------------------------------------- 1,149.62

TO BE CREDITED TO THE ACCOUNT OF C. L. HERREN, PRESENT

POSTMASTER:

57 PERCENT OF THE PENALTY OF BROWN'S BOND ------------- $1,140.00

57 PERCENT OF BROWN'S CREDIT IN THE RETIREMENT FUND --- 368.39

57 PERCENT OF THE UNPAID SALARY DUE TO BROWN ---------- 15.53

TOTAL ----------------------------------------------- 1,523.92

NO ACTION WILL BE TAKEN BY THIS OFFICE UNTIL RECEIPT OF YOUR REPLY.

IT APPEARS FROM THE RECORD THAT CLARENCE P. BROWN, POST-OFFICE CLERK AT CLARINDA, IOWA, WAS SUSPENDED FROM DUTY MARCH 20, 1937, FOR EMBEZZLEMENT OF $5,800, POSTAL-SAVINGS FUNDS, AND WAS DISMISSED FROM THE SERVICE APRIL 24, 1937. THE POST OFFICE DEPARTMENT HAS COLLECTED FROM BROWN'S SURETY $2,000, WHICH HAS BEEN DEPOSITED WITH THE TREASURER OF THE UNITED STATES TO THE CREDIT OF BOARD OF TRUSTEES, POSTAL SAVINGS SYSTEM, ACCOUNT OF RETURNABLE DEPOSITS, SYMBOL 42001, ACCOUNT OF CLARENCE L. HERREN, POSTMASTER AT CLARINDA, IOWA, AND HAS REQUESTED THAT THE AMOUNT OF $27.24 DUE BROWN AS SALARY FROM MARCH 16 TO 20, 1937, AND $646.30 TO HIS CREDIT IN THE RETIREMENT FUND BE WITHHELD FROM PAYMENT PENDING ADJUSTMENT OF HIS ACCOUNT.

THE RECORD ALSO DISCLOSES THAT $2,500 OF THE AMOUNT CHARGED AGAINST BROWN WAS EMBEZZLED BY HIM DURING THE TERM OF OFFICE OF ALEXANDER B. CLARK, WHO SERVED AS POSTMASTER AT THE CLARINDA OFFICE FROM MAY 1924 TO MAY 31, 1936, AND THE REMAINDER, $3,300, WAS EMBEZZLED SUBSEQUENTLY, THAT IS TO SAY, DURING THE INCUMBENCY OF CLARENCE L. HERREN AS POSTMASTER. IT IS APPARENTLY BECAUSE OF SUCH FACTS THAT THE LETTER, SUPRA, SUGGESTS THAT THE AMOUNT COLLECTED ON BROWN'S BOND PLUS THE OTHER AMOUNTS OTHERWISE DUE HIM BE PROPORTIONED AND CREDITED TO THE ACCOUNTS OF THE ABOVE POSTMASTERS ON THE BASIS OF 43 PERCENT FOR CREDIT TO THE ACCOUNT OF FORMER POSTMASTER CLARK AND 57 PERCENT TO THE ACCOUNT OF POSTMASTER HERREN.

WITH RESPECT TO THE AMOUNT TO THE CREDIT OF THIS FORMER EMPLOYEE IN THE RETIREMENT FUND ATTENTION IS INVITED TO DECISION OF FEBRUARY 15, 1930, A- 29365, TO THE SECRETARY OF THE INTERIOR, WHEREIN WAS CONSIDERED THE INDEBTEDNESS OF AN ASSISTANT POSTMASTER RESULTING FROM EMBEZZLEMENT OF POSTAL FUNDS OVER A PERIOD OF TIME COVERING PART OF THE TENURE OF OFFICE OF TWO POSTMASTERS. SAID DECISION HELD THAT THE ENTIRE AMOUNT TO THE CREDIT OF THE DEBTOR IN THE RETIREMENT FUND SHOULD BE APPLIED IN PART SATISFACTION OF THE AMOUNT EMBEZZLED AND THAT THE AMOUNT IN SUCH FUND DEDUCTED DURING THE TERM OF EACH POSTMASTER PLUS INTEREST THEREON BE APPLIED TO THE CREDIT OF EACH POSTMASTER RESPECTIVELY. NO REASON IS APPARENT WHY THE SAME RULE SHOULD NOT BE APPLIED IN THE PRESENT CASE.

AS TO THE AMOUNT COLLECTED FROM THE SURETY THERE APPEARS NO REASON WHY THE ENTIRE AMOUNT IF NECESSARY SHOULD NOT BE CREDITED TO THE ACCOUNT OF THE FORMER POSTMASTER. SINCE, IF AT THE TIME THE FORMER POSTMASTER RETIRED FROM OFFICE THERE HAD BEEN KNOWLEDGE OF THE SHORTAGE IN HIS ACCOUNTS DUE TO THE EMBEZZLEMENT BY BROWN, THERE WOULD HAVE BEEN APPLIED AGAINST THE SHORTAGE THE RETIREMENT DEDUCTIONS TO BROWN'S CREDIT AND THE AMOUNT OF BROWN'S BOND OR SO MUCH THEREOF AS NEEDED, IT SEEMS ONLY LOGICAL THAT THE SAME ACTION SHOULD NOW BE TAKEN IN THE MATTER. THE FACT THAT THE EMBEZZLEMENT WAS NOT DISCOVERED UNTIL LATER DOES NOT AFFECT THE BASIC PRINCIPLE APPLICABLE, NAMELY, THAT THE FORMER POSTMASTER IS ENTITLED TO RECEIVE CREDIT FOR THE FULL AMOUNT RECOVERED FROM THE SURETY IF NECESSARY TO LIQUIDATE THE CHARGE IN HIS ACCOUNTS.

IN THE CIRCUMSTANCES THE ADJUSTMENT OF THE ACCOUNTS WILL BE ON THE FOLLOWING BASIS:

THE AMOUNT OF RETIREMENT DEDUCTIONS, PLUS INTEREST, WITHHELD FROM BROWN'S SALARY UP TO AND INCLUDING MAY 31, 1936, WILL BE APPLIED TO REDUCE THE AMOUNT OF SHORTAGE INCURRED DURING THE INCUMBENCY OF ALEXANDER B. CLARK, AND THE AMOUNT WITHHELD THEREAFTER, PLUS INTEREST THEREON, WILL BE APPLIED TO THE SHORTAGE INCURRED DURING THE INCUMBENCY OF THE PRESENT POSTMASTER. TO THE SHORTAGE IN THE ACCOUNTS OF FORMER POSTMASTER CLARK THERE WILL BE APPLIED ALSO AN ITEM OF $1.48 APPEARING FROM THE RECORDS OF THIS OFFICE AS A CREDIT ITEM IN HIS MONEY-ORDER ACCOUNTS FOR APRIL AND MAY 1936. THE AMOUNT COLLECTED FROM THE SURETY WILL BE APPLIED IN LIQUIDATION OR PART LIQUIDATION OF THE SHORTAGE INCURRED DURING THE INCUMBENCY OF THE FORMER POSTMASTER, THE BALANCE, IF ANY, TO THE SHORTAGE INCURRED DURING THE INCUMBENCY OF THE PRESENT POSTMASTER. THE AMOUNT OF SALARY DUE BROWN FOR THE PERIOD MARCH 16 TO 20, 1937, HAVING BEEN EARNED DURING THE INCUMBENCY OF THE PRESENT POSTMASTER, WILL BE APPLIED TO THE SHORTAGE INCURRED DURING SAID INCUMBENCY.