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GAO discussed U.S. involvement in processing and verification procedures for settling damage claims resulting from Army maneuvers in the Federal Republic of Germany. GAO noted that the United States and Germany agreed that: (1) the United States would pay 75 percent of property damage costs; and (2) Germany had the exclusive right to adjudicate damage claims. GAO also noted that the Army Claims Service, Europe: (1) is responsible for processing and paying maneuver damage claims in Germany; (2) has paid virtually all such claims without verifying that damage occurred or that its forces caused the damage; (3) considerably lowered the amount of damages it paid after it began inspecting damages; and (4) strengthened its verification procedures. GAO believes that, to protect U.S. interests and reduce U.S. damage claims costs, the Army should: (1) identify claims for verification through inspections; (2) identify questionable claims for verification; (3) keep adequate records of verification efforts; and (4) review claims through on-site inspections.

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