B-125856, NOV. 22, 1955

B-125856: Nov 22, 1955

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WHITNEY: FURTHER REFERENCE IS MADE TO YOUR LETTER OF OCTOBER 5. YOU STATE THAT YOU HAVE RECEIVED GENERAL ACCOUNTING OFFICE NOTICE OF SETTLEMENT OF CLAIM. THAT TO YOUR KNOWLEDGE NO CHARGES OF IRREGULAR PROCEDURES AND PRACTICES HAVE BEEN MADE AGAINST FRAZIER INSTITUTE. IT APPEARS THAT THE FRAZIER INSTITUTE OF BARBERING IS ONE OF A NUMBER OF TRADE SCHOOLS AND RELATED BUSINESSES IN WHICH YOU HAVE BEEN INTERESTED. THE RECORD NOW DISCLOSES THAT THE VETERANS ADMINISTRATION HAS SUBMITTED REPORTS TO THE DEPARTMENT OF JUSTICE ALLEGING THAT OVERPAYMENTS WERE MADE TO THESE SCHOOLS. THE VETERANS ADMINISTRATION HAS ALSO REPORTED EVIDENCE AND INFORMATION OF RECORD INDICATING THAT IRREGULAR PRACTICES AND PROCEDURES WERE EMPLOYED IN THE OPERATIONS OF THESE SCHOOLS.

B-125856, NOV. 22, 1955

TO MR. M. C. WHITNEY:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF OCTOBER 5, 1955, AS SUPPLEMENTED BY YOUR LETTER OF OCTOBER 22, 1955, RELATIVE TO YOUR CLAIM FOR AN AMOUNT ALLEGED TO BE DUE FRAZIER INSTITUTE OF BARBERING, INC., PURSUANT TO A DECISION RENDERED SEPTEMBER 18, 1953, BY THE VETERANS' EDUCATION APPEALS BOARD ON ACCOUNT OF TRAINING FURNISHED TO VETERANS ENROLLED IN THE INSTITUTE UNDER THE EDUCATIONAL AND VOCATIONAL PROGRAM ADMINISTERED BY THE VETERANS ADMINISTRATION.

YOU STATE THAT YOU HAVE RECEIVED GENERAL ACCOUNTING OFFICE NOTICE OF SETTLEMENT OF CLAIM, CERTIFICATE NO. 2263349, INDICATING THE AMOUNT PAYABLE ON THIS CLAIM; THAT THE GOVERNMENT HAS NO CLAIM OF OVERPAYMENT AGAINST FRAZIER INSTITUTE, AND THAT TO YOUR KNOWLEDGE NO CHARGES OF IRREGULAR PROCEDURES AND PRACTICES HAVE BEEN MADE AGAINST FRAZIER INSTITUTE. YOU REQUEST AN EXPLANATION AS TO THE BASIS FOR WITHHOLDING PAYMENT OF THE AMOUNT CLAIMED.

AS STATED IN OUR LETTER OF SEPTEMBER 30, 1955, TO CONGRESSMAN THURMOND CHATHAM, REFERRED TO IN YOUR LETTER OF OCTOBER 5, IT APPEARS THAT THE FRAZIER INSTITUTE OF BARBERING IS ONE OF A NUMBER OF TRADE SCHOOLS AND RELATED BUSINESSES IN WHICH YOU HAVE BEEN INTERESTED. THE RECORD NOW DISCLOSES THAT THE VETERANS ADMINISTRATION HAS SUBMITTED REPORTS TO THE DEPARTMENT OF JUSTICE ALLEGING THAT OVERPAYMENTS WERE MADE TO THESE SCHOOLS, INCLUDING TRADE SCHOOLS, INC., LOUISVILLE BARBERING INSTITUTE, AND THE CINCINNATI INSTITUTE OF BARBERING, AS WELL AS THE FRAZIER INSTITUTE OF BARBERING. THE OVERPAYMENTS REPORTEDLY MADE TO FRAZIER INSTITUTE AMOUNT TO $4,969.26. THE VETERANS ADMINISTRATION HAS ALSO REPORTED EVIDENCE AND INFORMATION OF RECORD INDICATING THAT IRREGULAR PRACTICES AND PROCEDURES WERE EMPLOYED IN THE OPERATIONS OF THESE SCHOOLS, WHICH MATTER IS PRESENTLY UNDER CONSIDERATION BY THE DEPARTMENT OF JUSTICE. IN THIS CONNECTION, SEE OUR LETTER TO YOU DATED MAY 7, 1954, RELATIVE TO YOUR CLAIMS FOR ADDITIONAL COMPENSATION ALLEGED TO BE DUE TRADE SCHOOLS, INC.

UNDER SUCH CIRCUMSTANCES, IT IS THE ESTABLISHED POLICY OF THIS OFFICE TO TAKE NO ACTION UNTIL AFTER THE NECESSARY INVESTIGATIONS AND EVALUATIONS HAVE BEEN COMPLETED AND ADVICE HAS BEEN RECEIVED FROM THE ATTORNEY GENERAL. THE CERTIFICATE OF SETTLEMENT RELATIVE TO THE CLAIM OF FRAZIER INSTITUTE OF BARBERING HAS THEREFORE BEEN RECALLED, AND YOU ARE ADVISED THAT FURTHER ACTION IN THE MATTER WILL BE IN ABEYANCE HERE PENDING RECEIPT OF ADVICE FROM THE ATTORNEY GENERAL.

FURTHERMORE, WE HAVE BEEN ADVISED THAT OFFERS OF SETTLEMENT OF THE OPEN ACCOUNTS PERTAINING TO ALL OF THE SCHOOLS IN WHICH YOU ARE INTERESTED HAVE BEEN SUBMITTED BY YOUR ATTORNEYS TO MR. EDWIN M. STANLEY, UNITED STATES ATTORNEY AT GREENSBORO, NORTH CAROLINA, FOR THE PURPOSE OF ARRIVING AT A BASIS OF SETTLEMENT OF THE ENTIRE MATTER. THESE NEGOTIATIONS, IT IS UNDERSTOOD, WILL INCLUDE THE OVERPAYMENTS REPORTEDLY MADE TO FRAZIER INSTITUTE.