B-211110, DEC 2, 1983, OFFICE OF GENERAL COUNSEL B-211110, B-212664, B-212843, B-212845, B-212846, B-213410, DEC 2, 1983, OFFICE OF GENERAL COUNSEL

B-211110: Dec 2, 1983

Additional Materials:

Contact:

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

 

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

WE HAVE CONSOLIDATED THESE REQUESTS BECAUSE THEY EACH INVOLVE A SUBSTANTIALLY IDENTICAL FACT SITUATION - THE NEGOTIATION BY A PAYEE OF BOTH AN ORIGINAL CHECK AND A SUBSEQUENTLY ISSUED REPLACEMENT CHECK. A TREASURY CHECK WAS ISSUED TO AN ARMY MEMBER OR CIVILIAN EMPLOYEE. A STOP PAYMENT ORDER WAS THEN PLACED ON EACH CHECK AND A REPLACEMENT CHECK WAS ISSUED TO THE PAYEE. BOTH THE ORIGINAL CHECK AND THE SUBSTITUTE CHECK WERE SUCCESSFULLY NEGOTIATED BY THE PAYEE AND PAID BY THE TREASURY. SEC. 3527(C) TO RELIEVE A DISBURSING OFFICER FROM LIABILITY FOR A DEFICIENCY RESULTING FROM AN IMPROPER PAYMENT UPON DETERMINING "THAT THE PAYMENT WAS NOT THE RESULT OF BAD FAITH OR LACK OF REASONABLE CARE BY THE OFFICIAL.".

B-211110, DEC 2, 1983, OFFICE OF GENERAL COUNSEL B-211110, B-212664, B-212843, B-212845, B-212846, B-213410, DEC 2, 1983, OFFICE OF GENERAL COUNSEL

PRECIS-UNAVAILABLE

MR. CLYDE E. JEFFCOAT, PRINCIPAL DEPUTY COMMANDER, U.S. ARMY FINANCE AND ACCOUNTING CENTER, DEPARTMENT OF THE ARMY:

DEAR MR. JEFFCOAT:

THIS RESPONDS TO SEVEN SEPARATE REQUESTS THAT WE RELIEVE VARIOUS ARMY FINANCE AND ACCOUNTING OFFICERS UNDER 31 U.S.C. SEC. 3527(C) FROM LIABILITY FOR IMPROPER PAYMENTS MADE FROM THEIR ACCOUNTS. WE HAVE CONSOLIDATED THESE REQUESTS BECAUSE THEY EACH INVOLVE A SUBSTANTIALLY IDENTICAL FACT SITUATION - THE NEGOTIATION BY A PAYEE OF BOTH AN ORIGINAL CHECK AND A SUBSEQUENTLY ISSUED REPLACEMENT CHECK. AS DISCUSSED BELOW, YOUR SUBMISSIONS PROVIDE THE NECESSARY ELEMENTS FOR RELIEF, AND WE GRANT RELIEF IN EACH CASE.

EACH OF THE IMPROPER PAYMENTS IN QUESTION AROSE IN A SUBSTANTIALLY SIMILAR FACT SITUATION. IN EACH CASE, A TREASURY CHECK WAS ISSUED TO AN ARMY MEMBER OR CIVILIAN EMPLOYEE. SHORTLY THEREAFTER, IN EACH CASE, THE PAYEE REPRESENTED TO ARMY DISBURSING OFFICIALS THAT THE CHECK HAD NOT BEEN RECEIVED. A STOP PAYMENT ORDER WAS THEN PLACED ON EACH CHECK AND A REPLACEMENT CHECK WAS ISSUED TO THE PAYEE. IN EACH CASE, BOTH THE ORIGINAL CHECK AND THE SUBSTITUTE CHECK WERE SUCCESSFULLY NEGOTIATED BY THE PAYEE AND PAID BY THE TREASURY.

THIS OFFICE HAS AUTHORITY UNDER 31 U.S.C. SEC. 3527(C) TO RELIEVE A DISBURSING OFFICER FROM LIABILITY FOR A DEFICIENCY RESULTING FROM AN IMPROPER PAYMENT UPON DETERMINING "THAT THE PAYMENT WAS NOT THE RESULT OF BAD FAITH OR LACK OF REASONABLE CARE BY THE OFFICIAL." RELIEF OF AN ACCOUNTABLE OFFICER DOES NOT AFFECT THE LIABILITY TO THE GOVERNMENT OF THE PERSON WHO RECEIVED AN IMPROPER PAYMENT. AS WE DISCUSSED IN 62 COMP.GEN. 91 (1982), WE ARE CONTINUING TO HANDLE DUPLICATE CHECK CASES UNDER THIS AUTHORITY PENDING CONGRESSIONAL CLARIFICATION OF THIS ISSUE. WE HAVE RECOGNIZED THAT IN "DUPLICATE CHECK" CASES, SUCH AS THOSE BEFORE US, THE IMPROPER PAYMENT "IS TOTALLY BEYOND THE RESPONSIBILITY AND CONTROL OF THE AGENCY DISBURSING OFFICER AND IS SOMETHING FOR WHICH HE SHOULD INCUR NO LIABILITY." 62 COMP.GEN. 91, 94 (1982). RELIEF IS GRANTED WHEN THE RECORD INDICATES THAT ARMY PERSONNEL ACTED WITHIN THE BOUNDS OF DUE CARE AS ESTABLISHED BY APPLICABLE REGULATIONS, THAT THERE IS NO EVIDENCE OF BAD FAITH ON THE PART OF THE ACCOUNTABLE OFFICER, AND THAT A DILIGENT EFFORT WAS MADE TO COLLECT THE OVERPAYMENT. 62 COMP.GEN. 91.

WE FIND THAT THOSE REQUIREMENTS ARE MET IN EACH OF THE CASES AT HAND. APPEARS THAT THE REQUEST FOR STOP PAYMENT AND THE ISSUANCE OF A SUBSTITUTE CHECK IN THESE CASES WERE WITHIN THE BOUNDS OF DUE CARE AS ESTABLISHED BY ARMY REGULATIONS. SEE AR 37-103, PARAGRAPHS 4-161, 4 162 AND 4-164. THERE WAS NO INDICATION OF BAD FAITH ON THE PART OF THE ACCOUNTABLE OFFICERS. IN ADDITION, SINCE IT APPEARS THAT AGGRESSIVE COLLECTION ATTEMPTS ARE BEING MADE IN ACCORDANCE WITH THE FEDERAL CLAIMS COLLECTION ACT AND THE PROCEDURES OUTLINED IN OUR DECISION, 62 COMP.GEN. (B-211440 ET. AL. JUNE 20, 1983), RELIEF IS GRANTED AS REQUESTED IN THE FOLLOWING CASES:

AMOUNT

GAO# ACCOUNTABLE OFFICER DUP. PAYEE OF LOSS

B-211110 MAJOR J.B. KELLER MICHAEL W. HALIBURTON $566.49 B-212664 MAJOR M.H. FLEUMER TIMOTHY MURPHY 531.43 B-212843 LT. COLONEL J. LAWTON BLYTHE E. HARVEY 160.75 B-212845 MAJOR H.J. WHITEHEAD SHERI D. BRYSON 156.50 B-212845 MAJOR H.J. WHITEHEAD SHERI D. BRYSON 40.74 B-212846 LT. COL. J.T. BOURLAND DORIS J. DROWN 284.17 B-213410 MAJOR J.B. KELLER PEDRO G. COLLINS 285.29

FINALLY, WE NOTE THAT IN B-212845 THE REQUEST FOR RELIEF WAS UNTIMELY. WE AGAIN REMIND YOU THAT YOUR AGENCY IS ASKED TO REPORT ANY FINANCIAL IRREGULARITIES TO OUR OFFICE WITHIN 2 YEARS FROM THE TIME THE LOSS IS REFLECTED IN A FINANCE AND ACCOUNTING OFFICER'S ACCOUNT. 7 GAO POLICY AND PROCEDURES MANUAL 28.14. THIS WILL AVOID ANY POTENTIAL STATUTE OF LIMITATION PROBLEMS.