B-226153, MAR 17, 1987, OFFICE OF GENERAL COUNSEL

B-226153, MAR 17, 1987, OFFICE OF GENERAL COUNSEL

APPROPRIATIONS/FINANCIAL MANAGEMENT - ACCOUNTABLE OFFICERS - DISBURSING OFFICERS - RELIEF - ILLEGAL/IMPROPER PAYMENTS - SUBSTITUTE CHECKS DIGEST: RELIEF IS GRANTED ARMY DISBURSING OFFICIAL UNDER 31 U.S.C. SEC. 3527(C) FROM LIABILITY FOR TWO IMPROPER PAYMENTS RESULTING FROM PAYEE'S NEGOTIATION OF BOTH ORIGINAL AND RECERTIFIED MILITARY CHECKS IN TWO SEPARATE INSTANCES. PROPER PROCEDURES WERE FOLLOWED IN THE ISSUANCE OF THE RECERTIFIED CHECKS, THERE WAS NO INDICATION OF BAD FAITH ON THE PART OF THE DISBURSING OFFICIAL AND SUBSEQUENT COLLECTION ATTEMPTS ARE BEING PURSUED. HOWEVER, FOR CASES INVOLVING NOTICES OF LOSSES RECEIVED AFTER JUNE 1, 1986, WHERE THE PAYEE HAS LEFT THE ARMY OR ITS EMPLOY, WE WILL NO LONGER DENY RELIEF IF FINANCE OFFICER DELAYS MORE THAN 3 MONTHS IN FORWARDING THE DEBT TO YOUR COLLECTION DIVISION.

BRIGADIER GENERAL B. W. HALL:

THIS RESPONDS TO YOUR REQUESTS OF JANUARY 23 AND FEBRUARY 18, 1987, THAT WE RELIEVE LIEUTENANT COLONEL (LTC) R. E. YRJANSON, FINANCE CORPS, DSSN 6396, FINANCE AND ACCOUNTING OFFICER, 7TH INFANTRY DIVISION AND FORT ORD, FORT ORD, CALIFORNIA, UNDER 31 U.S.C. SEC. 3527(C) FOR TWO IMPROPER PAYMENTS TOTALLING $879.48 PAYABLE TO MR. JOSE DUQUE. FOR THE REASONS STATED BELOW, RELIEF IS GRANTED.

EACH OF THE LOSSES RESULTED WHEN THE PAYEE NEGOTIATED BOTH THE ORIGINAL AND A RECERTIFIED CHECK. THE RECERTIFIED CHECKS WERE IN THE SAME AMOUNT AS THE ORIGINAL CHECKS. THE RECERTIFIED CHECKS WERE ISSUED ON THE BASIS OF THE PAYEE'S ALLEGATIONS THAT THE ORIGINAL CHECKS HAD NOT BEEN RECEIVED AND REQUESTS FOR STOP PAYMENT HAD BEEN MADE. ALL OF THE CHECKS WERE ISSUED BY THE ARMY UNDER AUTHORITY DELEGATED BY THE DEPARTMENT OF THE TREASURY. 31 C.F.R. SEC. 245.8 AND TREASURY FISCAL REQUIREMENTS MANUAL FOR GUIDANCE OF DEPARTMENTS AND AGENCIES, BULLETIN NO. 83-28.

WE NOTE THAT THE SECOND RECERTIFIED CHECK WAS ISSUED AFTER THE DAILY ADVICE OF STATUS (DAS) ON THE FIRST INSTRUMENT WAS RECEIVED FROM TREASURY. THE DAS INDICATED THAT THE FIRST CHECK HAD NOT BEEN CASHED. WAS NOT UNTIL AFTER BOTH RECERTIFIED CHECKS HAD BEEN ISSUED THAT THE FINANCE OFFICER RECEIVED THE CHARGEBACKS FROM TREASURY INDICATING THAT ALL FOUR INSTRUMENTS HAD BEEN CASHED AND PAID.

IT APPEARS THEN, UNDER THESE CIRCUMSTANCES, THAT THE ISSUANCE OF BOTH RECERTIFIED CHECKS WERE WITHIN THE BOUNDS OF DUE CARE. ID. THERE WAS NO INDICATION OF BAD FAITH ON THE PART OF THE DISBURSING OFFICER AND ADEQUATE COLLECTION EFFORTS ARE NOW BEING MADE. ACCORDINGLY, WE GRANT RELIEF.

ALTHOUGH WE HAVE GRANTED RELIEF TO THE DISBURSING OFFICER IN THIS CASE, WE DO NOT BELIEVE THAT THE ARMY'S COLLECTION PROCEDURES, TAKEN TOGETHER, MEET THE DILIGENT CLAIMS COLLECTION REQUIREMENT OF 31 U.S.C. SEC. 3527(C). ONCE THE CHARGEBACKS FROM TREASURY WERE RECEIVED BY THE FINANCE OFFICE, IT TOOK THE ARMY OVER 20 MONTHS IN ONE CASE AND ALMOST 22 MONTHS IN THE OTHER TO REFER THESE LOSSES TO YOUR COLLECTION DIVISION. AS WE PREVIOUSLY INDICATED TO YOU, FOR CASES INVOLVING NOTICES OF LOSSES RECEIVED AFTER JUNE 1, 1986, WHERE THE PAYEE HAS LEFT THE ARMY OR ITS EMPLOY, WE WILL NO LONGER GRANT RELIEF IF ARMY DELAYS MORE THAN 3 MONTHS IN FORWARDING THE DEBT TO YOUR COLLECTION DIVISION. HOWEVER, SINCE THE CHARGEBACKS FROM TREASURY WERE RECEIVED PRIOR TO THAT DATE, WE WILL NOT DENY RELIEF HERE.