Request for Refund of Erroneous Deductions

A Department of Agriculture employee's claim for refund of deductions was made for premiums believed due on optional life insurance coverage under the Federal Employees' Group Life Insurance (FEGLI). The employee's claim for refund of the deductions was first received in the Claims Group, and he was advised that the deductions made from his pay for optional life insurance more than 6 years prior to that date could not be refunded to him. The employee considered the erroneous deductions to be an unjustified or unwarranted personnel action. The employee believed that the deductions were held in trust for him, or were otherwise his assets, so that his claim for deductions was not time barred. GAO has held that erroneous deductions of FEGLI premiums from the pay of an employee who was ineligible for insurance should be refunded. Consequently, the employee was entitled to a repayment. However, he was not repaid the erroneous deductions made more than 6 years before he filed his claim with GAO since the GAO Act of 1974 prohibits the consideration of any claim not received with GAO within 6 years after the date that claim first accrued. Regarding the employee's arguments that his claim should not be subject to that limitation, GAO has held that failure of an agency to forward a claim to GAO may not be construed as an unjustified or unwarranted personnel action, so as to give rise to a new claim which would not be barred by the Act. Regarding payment of interest on the accounts erroneously withheld, such payment may not be made unless specifically authorized by law or provided for by a valid contract provision. Therefore, interest may not be paid on the amount due.