B-215982, OCT 17, 1984, OFFICE OF GENERAL COUNSEL

B-215982, OCT 17, 1984, OFFICE OF GENERAL COUNSEL

DEBT COLLECTIONS - WAIVER - AUTHORITY DIGEST: AGENCY REQUEST FOR COMPTROLLER GENERAL TO ALLOW AGENCY TO TERMINATE DEBT COLLECTION IN EXCESS OF $20,000 MAY NOT BE GRANTED SINCE WHEN DEBT EXCEEDS $20,000 ONLY THE DEPARTMENT OF JUSTICE HAS AUTHORITY TO ALLOW AGENCY'S REQUEST. SEE 31 U.S.C. SEC. 3711.

MR. ROGER P. FELDMAN, COMPTROLLER DEPARTMENT OF STATE WASHINGTON, D.C. 20520

DEAR MR. FELDMAN:

THIS IS IN RESPONSE TO YOUR LETTER OF AUGUST 2, 1984, REQUESTING THAT WE GRANT PERMISSION TO THE DEPARTMENT OF STATE TO WRITE-OFF AS UNCOLLECTIBLE A DEBT OF $25,861.47 IN THE ACCOUNT OF A DECEASED CASHIER WHO WORKED AT THE AMERICAN EMBASSY IN MASERU, LESOTHO. AS WILL BE EXPLAINED, WE ARE UNABLE TO GRANT YOUR REQUEST. INSTEAD, YOU SHOULD REFER THIS MATTER TO THE DEPARTMENT OF JUSTICE.

ACCORDING TO YOUR SUBMISSION, THE CASHIER DIED IN AN AUTOMOBILE ACCIDENT IN JULY 1982, AND A SUBSEQUENT AUDITING OF HIS ACCOUNT, COMPLETED IN SEPTEMBER 1982, DISCLOSED A SHORTAGE OF $25,861.47. BASED ON THE FINDINGS OF AN INTERNAL INVESTIGATION, A COMMITTEE OF INQUIRY CONCLUDED THAT THE DECEASED CASHIER HAD EMBEZZLED THE FUNDS. THE COMMITTEE DETERMINED THAT SINCE THE CASHIER WAS DEAD THE ONLY SOURCE FOR RECOVERING THE FUNDS WAS HIS WIDOW'S CIVIL SERVICE SURVIVOR'S ANNUITY OF $100 A MONTH. THE COMMITTEE RECOMMENDED, HOWEVER, THAT THE DEPARTMENT REQUEST THE GENERAL ACCOUNTING OFFICE TO WAIVE COLLECTION OF THE DEBT SINCE TO COLLECT THIS AMOUNT FROM THE SMALL SURVIVOR'S ANNUITY WOULD CONSTITUTE AN UNDUE HARDSHIP.

THE AUTHORITY FOR TERMINATION OF COLLECTION AGAINST ONE INDEBTED TO THE GOVERNMENT IS FOUND IN 31 U.S.C. SEC. 3711. UNDER THIS STATUTE HEADS OF AGENCIES MAY TERMINATE COLLECTION ACTION ON A DEBT, IF THE DEBT DOES NOT EXCEED $20,000, AND IF NO PERSON LIABLE ON THE DEBT HAS THE PRESENT OR PROSPECTIVE ABILITY TO PAY A SIGNIFICANT AMOUNT OF THE CLAIM. 31 U.S.C. SEC. 3711(A)(3). THE COMPTROLLER GENERAL HAS THE SAME AUTHORITY AS AN AGENCY HEAD TO TERMINATE COLLECTION WHEN THE CLAIM IS REFERRED TO THE COMPTROLLER GENERAL FOR FURTHER COLLECTION ACTION. 31 U.S.C. SEC. 3711(B). LIKE THE HEADS OF AGENCIES, THE COMPTROLLER GENERAL'S AUTHORITY IS LIMITED TO CLAIMS OF NOT MORE THAN $20,000. INDEED, AS EXPLAINED IN THE RECENTLY REVISED FEDERAL CLAIMS COLLECTION STANDARDS, IMPLEMENTING 31 U.S.C. SEC. 3711, IF AN AGENCY CONCLUDES THAT SUSPENSION OR TERMINATION OF DEBT COLLECTION FOR A CLAIM IN EXCESS OF $20,000 IS APPROPRIATE, THEN "IT MUST REFER THE MATTER TO THE DEPARTMENT OF JUSTICE USING THE CLAIMS COLLECTION LITIGATION REPORT." 49 FED.REG. 8903 (1984) (TO BE CODIFIED AT 4 C.F.R. SEC. 104.1(B)).

SINCE THE CLAIM IN QUESTION EXCEEDS $20,000, THE COMPTROLLER GENERAL HAS NO AUTHORITY TO TERMINATE DEBT COLLECTION. ACCORDINGLY, WE ARE RETURNING YOUR SUBMISSION SO THAT YOU MAY PREPARE A CLAIMS COLLECTION LITIGATION REPORT AND FORWARD THE MATTER TO THE DEPARTMENT OF JUSTICE. SEE 49 FED.REG. 8904-05 (1984). IN THIS REGARD, THE FOLLOWING INFORMATION MAY BE HELPFUL. IF AN EMPLOYEE IS INDEBTED TO THE UNITED STATES AT THE TIME HE OR SHE LEAVES FEDERAL SERVICE, THE DEBT MAY BE WITHHELD OR COLLECTED FROM FINAL SALARY PAYMENTS, LUMP-SUM PAYMENTS FOR LEAVE, AND RETIREMENT CONTRIBUTIONS OR ANNUITIES. SEE 58 COMP.GEN. 501, 502-503 (1979). THE SAME RULES APPLY WHEN THE EMPLOYEE IS DECEASED. SEE B-190921, JANUARY 3, 1978. IN THE CURRENT CASE, HOWEVER, APPARENTLY THERE WERE NO MONEYS DUE THE DECEASED. RATHER, THE WIDOW IS RECEIVING A SURVIVOR'S ANNUITY, WHICH THE COMMITTEE OF INQUIRY DESCRIBED AS "CIVIL SERVICE RETIREMENT." THE OFFICE OF PERSONNEL MANAGEMENT HAS DETERMINED THAT "THE DEBT OF A DECEASED EMPLOYEE MAY NOT BE RECOVERED FROM ANNUITY PAYABLE TO A SPOUSE OR CHILDREN." FEDERAL PERSONNEL MANUAL SUPP. NO. 831-1, S19-3(3) (INST. 31, SEPTEMBER 21, 1981)