B-164193, JUN. 5, 1968

B-164193, JUN. 5, 1968

TO MR. JOHN H. SYKES:

THE CHIEF INSPECTOR OF THE POST OFFICE DEPARTMENT HAS REFERRED TO OUR OFFICE FOR CONSIDERATION YOUR ATTORNEY'S LETTERS OF APRIL 9 AND MARCH 21, 1968, FORMALLY PROTESTING SET-OFF ACTION TAKEN BY THE POST OFFICE DEPARTMENT TO RECOVER $750.49 OF GOVERNMENT LOSSES CHARGED TO YOU IN CONNECTION WITH YOUR EMPLOYMENT AS A CLERK IN THE POST OFFICE AT SAN FRANCISCO, CALIFORNIA.

THE RECORD BEFORE OUR OFFICE SHOWS THAT YOU WERE APPREHENDED ON APRIL 21, 1967, FOR THEFT OF MAIL. YOU WERE INDICTED ON SUCH CHARGE AND ENTERED A PLEA OF GUILTY ON JULY 6, 1967. ON AUGUST 3, 1967, YOU WERE GIVEN A SIX- MONTH SUSPENDED SENTENCE AND PLACED ON PROBATION FOR A PERIOD OF TWO YEARS.

THERE IS, OF COURSE, NO DOUBT THAT YOU WERE GUILTY OF THE OFFENSE CHARGED AGAINST YOU. A NUMBER OF REGISTERED AND INSURED ITEMS WERE STOLEN OVER A PERIOD OF TIME AT THE POST OFFICE WHERE YOU WERE EMPLOYED. IN THE COURSE OF THE INVESTIGATION OF THE THEFTS, WHICH CONTINUED DURING THE INVESTIGATION, YOU WERE OBSERVED REMOVING PART OF THE MONEY CONTENT FROM ONE TEST LETTER. SHORTLY AFTER BEING OBSERVED, YOU WERE APPROACHED BY A POSTAL INSPECTOR, WHO ADVISED YOU OF YOUR RIGHTS TO SILENCE AND TO COUNSEL. YOU THEREUPON VOLUNTARILY REMOVED FROM YOUR POCKET MONEY WHICH WAS IDENTIFIED AS PART OF THE CONTENTS OF THE TEST LETTER. ALSO, YOU ACKNOWLEDGED THAT YOU HAD BEEN STEALING MAIL FOR APPROXIMATELY ONE YEAR; THAT YOU HAD OBTAINED ABOUT $200 FROM THE THEFTS; AND EXECUTED A SWORN AFFIDAVIT TO THAT EFFECT.

THE $750.49 CHARGED AGAINST YOU IS COMPOSED OF TWO ITEMS, AS FOLLOWS: ON AUGUST 1, 1966, AN INSURED PACKAGE CONTAINING A RING, CURRENCY AND A CREDIT CARD WAS MAILED AT THE POST OFFICE WHERE YOU WERE EMPLOYED. YOU WERE ON DUTY WHEN THE PACKAGE WAS MAILED AND WERE AWARE OF ITS CONTENTS. THE PACKAGE FAILED DELIVERY TO THE ADDRESSEE, AND THE POST OFFICE DEPARTMENT PAID INDEMNITY THEREON IN THE AMOUNT OF $150.49. THE DAY AFTER THE PACKAGE WAS MAILED, YOUR WIFE WAS ARRESTED BY THE SAN FRANCISCO POLICE FOR FRAUDULENT USE OF THE CREDIT CARD WHICH HAD BEEN MAILED IN THE INSURED PACKAGE. WHILE YOU DENIED THE ACTUAL THEFT OF THE PACKAGE, YOU ADMITTED PARTICIPATING IN THE THEFT, STATING THAT YOU TIPPED OFF ANOTHER UNNAMED EMPLOYEE WHO SUBSEQUENTLY INTERCEPTED THE MAIL POUCH AND EXTRACTED THE INSURED PACKAGE. YOUR LIABILITY FOR THE AMOUNT OF THIS ITEM IS CLEAR. EVEN ASSUMING THE TRUTH OF YOUR ALLEGATION THAT YOU DID NOT PERSONALLY STEAL THIS PACKAGE, YOUR ADMITTED COMPLICITY THEREIN WOULD RENDER YOU RESPONSIBLE.

ON OCTOBER 6, 1966, A CARRIER LEFT A NOTICE OF ATTEMPTED DELIVERY OF REGISTER NO. 8562X FOR THE ADDRESSEE THEREOF. ON OCTOBER 7, THE ADDRESSEE PRESENTED THE NOTICE AT STATION "P" WHERE YOU WERE EMPLOYED, BUT THE REGISTER COULD NOT BE FOUND. THE POST OFFICE DEPARTMENT SUBSEQUENTLY PAID $600 INDEMNITY FOR THIS LOST REGISTER. YOU WERE ON DUTY AT STATION "P" ON BOTH OCTOBER 6 AND OCTOBER 7, AND HAD ACCESS TO THE REGISTERED MAIL HELD FOR CALLERS. THIS IS THE SECOND ITEM FOR WHICH YOU ARE CHARGED.

LIABILITY IN CASES OF THIS NATURE IS ESTABLISHED ON THE BASIS OF A SHOWING THAT THE LOSSES OCCURRED, THAT THE POST OFFICE DEPARTMENT MADE PAYMENT THEREFOR, THAT THE THIEF WAS CAUGHT COMMITTING SIMILAR OFFENSES, THAT HE HAD ACCESS TO THE ITEMS IN QUESTION, AND THE ABSENCE OF AN INDICATION THAT ANY OTHER EMPLOYEE MIGHT HAVE COMMITTED THE THEFT. ALL THESE FACTORS WERE PRESENT IN YOUR CASE. HENCE, YOU WERE ALSO CONSIDERED RESPONSIBLE FOR THE SECOND LOSS DETAILED ABOVE, THE EVIDENCE THEREIN BEING SUFFICIENT TO MEET THE STANDARDS OF BOERNER V UNITED STATES, 30 F. SUPP. 635 (E.D. N.Y., 1939), AFFIRMED 117 F.2D 387 (2ND CIR. 1941), CERTIORARI DENIED 313 U.S. 587 (1941). WHILE YOU HAVE DENIED TAKING THE SECOND ITEM SET OUT ABOVE, YOU HAVE SUBMITTED NO EVIDENCE TO SUPPORT YOUR DENIAL. THE EVIDENCE DISCLOSED BY THE INVESTIGATION CONDUCTED BY THE POST OFFICE INSPECTORS IN CONNECTION WITH THIS ITEM IS SUFFICIENT TO ESTABLISH A PRIMA FACIE CASE AGAINST YOU, AND THE POST OFFICE DEPARTMENT HAS FOUND ON THE BASIS OF THAT EVIDENCE THAT YOU ARE, IN FACT, RESPONSIBLE FOR THE LOSS SUSTAINED BY THE GOVERNMENT. A MERE CATEGORICAL DENIAL IS NOT SUFFICIENT TO OVERCOME THE PRIMA FACIE CASE ESTABLISHED BY THE INVESTIGATION AND ADMINISTRATIVE FINDING, AND YOU MUST BE CONSIDERED INDEBTED TO THE UNITED STATES FOR THE AMOUNT OF THE GOVERNMENT'S LOSS. SEE 19 COMP. GEN. 88; B- 139796, JULY 10, 1959; B-150407, APRIL 4, 1963; BOERNER V UNITED STATES, SUPRA; UNITED FRUIT CO. V UNITED STATES, 33 F.2D 664 (5TH CIR. 1929). CF. 21 COMP. GEN. 1003.

AS TO THE GOVERNMENT'S USE OF SET-OFF AGAINST YOUR RETIREMENT FUND,THE RULE IS WELL-SETTLED THAT THE AMOUNT TO THE CREDIT OF A FORMER EMPLOYEE IN THE RETIREMENT FUND, WHEN PAYABLE, OR THE AMOUNT OF HIS RETIREMENT ANNUITIES, WHEN PAYABLE, MAY BE APPLIED IN LIQUIDATION OF HIS INDEBTEDNESS TO THE UNITED STATES. SEE 39 COMP. GEN. 203, WHEREIN IT WAS HELD ON PAGE 205 THAT:

"AS STATED IN 27 COMP. GEN. 703, IT IS LEGAL AND PROPER FOR THE GOVERNMENT, THROUGH ADMINISTRATIVE OFFICERS, TO FIRST APPLY ALL AVAILABLE ASSETS IN ITS POSSESSION, INCLUDING BOTH UNPAID SALARY AND AMOUNT IN THE RETIREMENT FUND, BELONGING TO A DEFAULTING OFFICER OR EMPLOYEE, TOWARD LIQUIDATION OF THE INDEBTEDNESS, BEFORE RESORTING TO ITS REMEDY UNDER THE BOND OF THE OFFICER OR EMPLOYEE. * * *" IT WAS ALSO HELD IN THAT DECISION, ON PAGE 206, THAT---

"OF COURSE, WHEN A FEDERAL EMPLOYEE SUBJECT TO THE CIVIL SERVICE RETIREMENT ACT, WHO HAS COMPLETED AT LEAST FIVE YEARS OF SERVICE LEAVES THE FEDERAL SERVICE PRIOR TO RETIREMENT AGE, HE HAS A VESTED RIGHT TO A FUTURE ANNUITY, 5 U.S.C. 2258 (NOW 5 U.S.C. 8338), WITH AN OPTION OF CLAIMING AND DRAWING OUT THE AMOUNT TO HIS CREDIT IN THE RETIREMENT FUND,5 U.S.C. 2261 (NOW 5 U.S.C. 8342). THUS, THE AMOUNT TO HIS CREDIT IS REQUIRED BY LAW TO REMAIN IN THE FUND WHEN HE LEAVES THE FEDERAL SERVICE AND IS NOT DUE HIM UNLESS AND UNTIL HE EXERCISES HIS OPTION. UNDER SUCH CONDITIONS, THE AMOUNT TO HIS CREDIT IS NOT AVAILABLE FOR SETOFF AGAINST ANY INDEBTEDNESS TO THE GOVERNMENT IN THE ABSENCE OF A CLAIM FOR SUCH AMOUNT FROM THE FORMER EMPLOYEE, WHICH RENDERS THE SUM DUE AND HENCE SUSCEPTIBLE TO SETOFF.' SEE ALSO, 41 COMP. GEN. 178; 35 ID. 126; 27 ID. 03; 21 ID. 1000; 19 ID. 88; 16 ID. 161; ID. 962; 7 ID. 305; B-114809, SEPTEMBER 5, 1962.

THE ABOVE-STATED RULE HAS BEEN RECOGNIZED AND AFFIRMED BY THE COURTS. UNITED STATES V UNITED STATES FIDELITY AND GUARANTY CO., 35 F.SUPP. 959 (E.D. PENN. 1940), IT WAS HELD, QUOTING FROM THE SYLLABUS, THAT --

"WHERE AN EMPLOYEE OF THE UNITED STATES HAS BEEN DISMISSED AND THE PORTION CONTRIBUTED BY HIM TO THE CIVIL SERVICE RETIREMENT FUND BECOMES PAYABLE TO HIM, THE UNITED STATES CAN WITHHOLD AN AMOUNT EQUAL TO ANY INDEBTEDNESS OF THE EMPLOYEE TO THE UNITED STATES.' SEE ALSO, BOERNER V UNITED STATES, SUPRA; O-LEARY V UNITED STATES, 82 CT. CL. 305 (1936).

IN VIEW OF THE ABOVE, WE HAVE NO ALTERNATIVE BUT TO SUSTAIN THE ACTION PREVIOUSLY TAKEN BY THE POST OFFICE DEPARTMENT IN CHARGING YOU FOR THE AMOUNT HERE INVOLVED AND BY THE CIVIL SERVICE COMMISSION IN SETTING OFF THAT AMOUNT FROM YOUR REFUND OF RETIREMENT DEDUCTIONS. IF YOU HAVE ANY CONVINCING EVIDENCE TO SUPPORT YOUR CONTENTIONS IN THIS MATTER, IT MAY BE FORWARDED TO OUR OFFICE WITH A REQUEST FOR RECONSIDERATION OF THIS DECISION. OF COURSE, IN INSTANCES WHERE AN AMOUNT OTHERWISE DUE A FORMER EMPLOYEE HAS BEEN WITHHELD AND SET OFF TO LIQUIDATE HIS INDEBTEDNESS TO THE UNITED STATES WITHOUT THE AMOUNT OF SUCH INDEBTEDNESS HAVING BEEN FOUND DUE IN A COURT PROCEEDING, THE FORMER EMPLOYEE IS ENTITLED TO INSTITUTE SUIT IN THE UNITED STATES COURT OF CLAIMS FOR RECOVERY OF THE AMOUNT SO WITHHELD, IF HE BELIEVES SUCH WITHHOLDING WAS IMPROPER.