[Claim for Per Diem Expenses Based in Part on Fraudulent Lodging Receipts]

B-206543: Sep 8, 1982

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Four Navy civilian employees submitted various individual travel vouchers for a 2-month period of temporary duty. The Navy determined that the employees had inflated the amount claimed for their total cost of lodging by submitting fraudulent lodging receipts. The employees subsequently appealed the decision of the Claims Group which denied their per diem claims. GAO held that a fraudulent claim for lodging taints the entire claim for per diem on days for which fraudulent information is submitted and that per diem payments may not be made for those days. GAO stated that the employees could submit further reclaim vouchers limited to reimbursable expenses other than per diem and, if the Navy were satisfied that these expenses were reimbursable and proper, they could be paid.

B-206543, SEP 8, 1982

DIGEST: 1. FOUR EMPLOYEES SIGNED AND SUBMITTED VARIOUS INDIVIDUAL TRAVEL VOUCHERS FOR A 2-MONTH PERIOD OF TEMPORARY DUTY, SUBSEQUENTLY, THE DEPARTMENT OF THE NAVY DETERMINED THAT THEY HAD INFLATED THE AMOUNT CLAIMED FOR THEIR TOTAL COST OF LODGING BY SUBMITTING FRAUDULENT LODGING RECEIPTS. FRAUDULENT CLAIM FOR LODGING TAINTS THE ENTIRE CLAIM FOR PER DIEM ON DAYS FOR WHICH FRAUDULENT INFORMATION IS SUBMITTED, AND PER DIEM PAYMENTS WILL NOT BE MADE FOR THOSE DAYS. 2. SINCE THE ORIGINAL VOUCHERS WERE TAINTED, NO PER DIEM MAY BE PAID EVEN IF THE EMPLOYEES' RECLAIM VOUCHERS CONTAIN ACCURATE STATEMENTS OF PER DIEM EXPENSES. UPON SUBMISSION OF FURTHER VOUCHERS, SEPARATE ITEMS SUCH AS TRANSPORTATION EXPENSES MAY BE ALLOWED IF THE NAVY DETERMINES THEY ARE REIMBURSABLE AND PROPERLY VERIFIED.

__________, ET AL. - FRAUDULENT TRAVEL VOUCHERS:

CAN THE "MEALS AND MISCELLANEOUS" COMPONENT OF PER DIEM EXPENSES BE CONSIDERED SEPARATE AND INDEPENDENT OF THE LODGING COMPONENT SO THAT IF ONLY THE LATTER IS TAINTED BY FRAUD, EMPLOYEES MAY STILL RECOVER THE FORMER? FOR THE FOLLOWING REASONS, WE AGAIN ANSWER THIS QUESTION IN THE NEGATIVE.

THIS DECISION IS IN RESPONSE TO APPEALS BY FOUR CIVILIAN EMPLOYEES OF THE DEPARTMENT OF THE NAVY AT MARE ISLAND NAVAL SHIPYARD, VALLEJO, CALIFORNIA, FROM OUR CLAIMS GROUP'S DENIALS OF THEIR CLAIMS FOR PER DIEM. MESSRS. __________, __________, __________, AND __________ WERE ASSIGNED TO TEMPORARY DUTY (TDY) AT PORTSMOUTH NAVAL SHIPYARD, PORTSMOUTH, NEW HAMPSHIRE, FROM APPROXIMATELY MARCH 12, 1979, TO MAY 10, 1979. EACH OF THEM SIGNED AND SUBMITTED VARIOUS INDIVIDUAL TRAVEL VOUCHERS WHICH GREATLY OVERSTATED THEIR TOTAL COST OF LODGING. THESE FIGURES FOR THE TOTAL COST OF LODGING WERE THEN USED AS ONE OF THE COMPONENTS OF THE THE EMPLOYEES WOULD BE ALLOWED UNDER THE LODGINGS PLUS SYSTEM. SEE FEDERAL TRAVEL REGULATIONS (FTR) PARA. 1-7.3(C)(1), FPMR 101-7, TEMP. REG. A-11, SUPP. 3, SEPTEMBER 28, 1976.

SUBSEQUENTLY, THE NAVY DETERMINED THAT ALL THE EMPLOYEES ABOVE HAD COMMITTED FRAUD BECAUSE THEY HAD INFLATED THE AMOUNTS CLAIMED FOR LODGING BY SUBMITTING FRAUDULENT LODGING RECEIPTS. THE EMPLOYEES WERE SUSPENDED FOR 14 CALENDAR DAYS FOR SUBMITTING FRAUDULENT TRAVEL CLAIMS. THE EMPLOYEES THEN SUBMITTED TRAVEL VOUCHERS FOR THE PERIOD IN QUESTION SHOWING THEIR ACTUAL LODGING COSTS.

THE RECORD CONTAINS FOUR STATEMENTS INDIVIDUALLY SIGNED BY EACH OF THE EMPLOYEES. EACH OF THESE STATEMENTS, IN RELEVANT PART, READS AS FOLLOWS:

"THIS IS MY FIRST REAL INFRACTION OF SHIPYARD AND GOVERNMENT RULES OR REGULATIONS. I WAS UNAWARE OF THE SEVERITY OF THE OFFENSE AND THE REAL IMPACT IT COULD CARRY."

THE STATEMENTS ALSO REQUEST THAT THEIR SUBSEQUENTLY SUBMITTED "CORRECTED" FINAL TRAVEL VOUCHERS BE PAID.

IN REGARD TO THESE "CORRECTED" VOUCHERS, THREE OF THEM LIST LODGING EXPENSES OF $236.04 EACH, BUT ON MR. __________ THAT SPACE WAS LEFT BLANK. ADDITIONALLY, ALL CONTAIN APPARENT CORRECTIONS AS TO THE DATE ON WHICH THEY WERE SIGNED, AND ONE OTHER VOUCHER CONTAINS AN APPARENT CORRECTION AS TO THE DATES OF TDY. THESE VOUCHERS ARE THE ONES WHICH THE EMPLOYEES HAVE PRESENTED TO OUR OFFICE FOR PAYMENT. IN ADDITION, THESE VOUCHERS CONTAIN CLAIMS FOR CERTAIN OTHER TRANSPORTATION AND MISCELLANEOUS EXPENSES.

IN SUPPORT OF THEIR CLAIMS, THE EMPLOYEES' ARGUMENT IS TO THE EFFECT THAT THEIR CLAIMS FOR THE MEALS AND MISCELLANEOUS COMPONENT OF PER DIEM (THEN $16 PER DAY) SHOULD BE CONSIDERED SEPARATE AND INDEPENDENT FROM ANY CLAIM FOR LODGING EXPENSES. THEY ALSO CONTEND THEY ARE ENTITLED TO OTHER EXPENSES SUCH AS TRANSPORTATION AND MISCELLANEOUS EXPENSES.

OUR CLAIMS GROUP DENIED THESE CLAIMS FOR PER DIEM ON THE GROUNDS THAT OUR DECISIONS DISALLOW ALL PER DIEM FOR EACH DAY A FRAUDULENT CLAIM FOR LODGING IS PRESENTED. IN THEIR APPEAL FROM THE CLAIMS GROUP'S DENIAL THE EMPLOYEES, THROUGH THEIR ATTORNEY, ARGUE THAT AN ALLEGED FRAUDULENT MISREPRESENTATION OF LODGING COSTS SHOULD NOT TAINT OTHER VERIFIABLE PER DIEM EXPENSES.

THE RESOLUTION OF THE PRESENT CASE IS GOVERNED BY THE PRINCIPLES ESTABLISHED BY OUR PREVIOUS DECISIONS AT 57 COMP.GEN. 664 (1978) AND 59 COMP.GEN. 99 (1979). IN THE FORMER DECISION WE HELD THAT WHERE THERE HAS BEEN A FRAUDULENT CLAIM FOR LODGING, THE FINAL SETTLEMENT VOUCHER SHOULD CONTAIN NO CLAIM FOR SUBSISTENCE EXPENSES FOR THE DAYS COVERED BY THE FRAUDULENT CLAIM. FOR THE PURPOSES OF THIS RULE, SUBSISTENCE EXPENSES MEANS ALL OF THOSE EXPENSES CONTEMPLATED WITHIN THE DEFINITION OF PER DIEM IN 59 COMP.GEN. 99. A FRAUDULENT CLAIM FOR LODGING TAINTS THE ENTIRE CLAIM FOR PER DIEM ON DAYS FOR WHICH SUCH FRAUDULENT INFORMATION WAS SUBMITTED. THE AVERAGE COST OF LODGING, AND MEALS AND MISCELLANEOUS EXPENSES CANNOT BE CONSIDERED SEPARATE ITEMS. RATHER, WHEN THEY ARE COMBINED, THEY YIELD THE DAILY PER DIEM. IT IS THUS EACH DAY OF PER DIEM WHICH IS CONSIDERED A SEPARATE ITEM FOR THE PURPOSES OF EVALUATING WHAT PARTS OF A VOUCHER WHICH CONTAINS OR IS SUPPORTED BY FRAUDULENT STATEMENTS MAY BE PAID. COMP.GEN. AT 101.

APPLYING THE ABOVE PRINCIPLES TO THE PRESENT CASE, WE OBSERVE THAT SINCE THE EMPLOYEES ORIGINALLY SUBMITTED FRAUDULENT INFORMATION WITH REGARD TO THEIR LODGING EXPENSES FOR THE ENTIRE PERIOD OF THEIR TDY, THE ENTIRE PER DIEM CLAIM IS TAINTED. THUS, EVEN IF THE EMPLOYEES' RECLAIM VOUCHERS CONTAIN ACCURATE STATEMENTS OF PER DIEM EXPENSES, NO PER DIEM MAY BE PAID. 57 COMP.GEN. AT 667. IF IT HAS NOT DONE SO ALREADY, THE NAVY SHOULD RECOUP THE ENTIRE AMOUNT OF ANY PER DIEM PAID. B-200838, APRIL 21, 1981.

AS TO THE EMPLOYEES' CLAIMS FOR EXPENSES OTHER THAN PER DIEM, WE HAVE HELD THAT A FRAUDULENT CLAIM FOR PER DIEM WOULD NOT NECESSITATE THE DENIAL OF THE OTHER SEPARATELY CLAIMED ITEMS ON A VOUCHER WHICH ARE NOT FRAUDULENTLY BASED. 57 COMP.GEN. AT 667. ACCORDINGLY, CLAIMS FOR TRANSPORTATION AND OTHER NON-SUBSISTENCE EXPENSES MAY BE ALLOWED WHERE OTHERWISE PROPER.

IN THE PRESENT CASE, THE "CORRECTED" FINAL TRAVEL VOUCHERS WHICH ARE PRESENTED TO US FOR PAYMENT CONTAIN CLAIMS FOR PER DIEM (WHICH CANNOT BE ALLOWED BECAUSE OF THE ORIGINALLY FRAUDULENT PER DIEM CLAIMS), AND FOR OTHER EXPENSES, SUCH AS TRANSPORTATION. AS NOTED ABOVE, HOWEVER, THESE VOUCHERS CONTAIN CERTAIN APPARENT CORRECTIONS. IN ORDER TO INSURE ACCURACY, WE WILL THUS NOT ALLOW THESE VOUCHERS TO BE CERTIFIED FOR PAYMENT. THE EMPLOYEES, IF THEY DESIRE, MAY SUBMIT FURTHER RECLAIM VOUCHERS LIMITED TO REIMBURSABLE EXPENSES OTHER APPROPRIATE NAVY OFFICIAL IS SATISFIED THAT THESE EXPENSES ARE REIMBURSABLE AND PROPERLY VERIFIED, THEY MAY BE PAID.