B-221950, Aug 19, 1987, Office of General Counsel

B-221950, Aug 19, 1987, Office of General Counsel

APPROPRIATIONS/FINANCIAL MANAGEMENT - Accountable Officers - Certifying officers - Illegal/improper payments - Liability restrictions - Statutes of limitation DIGEST: It is unnecessary to grant relief to a certifying officer in a case where the 3-year statute of limitation period has expired. Under these circumstances, the account in question must be considered settled and the accountable officer involved cannot be held liable for any erroneous payment. 31 U.S.C. Sec. 3526(c).

Mr. Larry Wilson:

This is in response to your request that we relieve Mr. E. C. Quintana, certifying officer with the U.S. Forest Service, of liability for a $5,250 duplicate payment made as a result of his certification concerning the propriety of that payment. As explained below, Mr. Quintana is not liable for this payment because his accounts covering this erroneous certification have been settled by operation of law.

The duplicate payment that had previously been paid for services was made to Sundance Helicopter, Inc. (SHI), a contractor from which the Forest Service leased aircraft and crew several times in September 1982.

It appears that Mr. Quintana certified the first voucher for payment on October 7, 1982, before the Forest Service received an invoice from SHI. We are unable to determine what prompted Mr. Quintana's initial certification, which, although unsupported by an invoice, was for the correct amount owed SHI. Subsequently, upon receiving the SHI invoice, Mr. Quintana certified a second payment for the same claim. The second payment was made on November 5, 1982. A letter was sent to SHI on January 13, 1983, explaining the circumstances of the overpayment along with a bill for collection of the loss. SHI subsequently declared bankruptcy and it has been determined that the overpayment is not recoverable. Your request for relief is dated January 24, 1986; it was received in this Office on February 3, 1986.

Under 31 U.S.C. Sec. 3526(c), our Office is authorized to settle accounts of accountable officers, and hence to grant or deny relief, "within 3 years after the date the Comptroller General receives the account" except when the loss is due to fraud or criminality by the accountable officer. As a result of changes in audit methods, accounts are now retained by the various agencies where they are subject to audit and settlement by our Office. To reflect this procedural change, our Office now considers the date of receipt by the agency of substantially complete accounts, or where accounts are retained at the site, the end of the period covered by the account, as the point from which the 3-year period provided for in 31 U.S.C. Sec. 3526(c) begins to run. See 62 Comp.Gen. 498 (1983). Our Office has consistently held that once the 3-year statutory period has expired, the account in question is considered settled and there is no need for our Office to consider whether or not to grant relief. Id.

In the present case, you state that the duplicate payment was made in November 1982, and was discovered during the review of the financial statement for that period which took place in January 1983. Since there is no evidence of fraud or other criminality on the part of the accountable officer involved, the 3-year period within which our Office is authorized to settle this account expired in January 1986. Our Office did not receive your request for relief until February 1986; therefore, the account must be regarded as settled. Accordingly, since Mr. Quintana can no longer bear any financial liability with respect to the duplicate payment, there is no need for our Office to consider whether or not to grant relief.

To avoid this problem in the future, we note that the GAO Policy and Procedures Manual for Guidance of Federal Agencies requires prompt reports of financial irregularities, both to avoid the expiration of the 3-year limitation period and to allow our Office an adequate opportunity to determine whether relief should be granted or denied. Thus, agencies are required to report irregularities not more than 2 year after the date the accounts are made available to GAO for audit (that is, the date the agency has substantially complete accounts). 7 GAO Policy and Procedures Manual, Sec. 23.14. See also B-221720, May 8, 1986; and B-217741, October 15, 1985.