[Federal Register Volume 73, Number 210 (Wednesday, October 29, 2008)]
[Rules and Regulations]
[Pages 64206-64207]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-25675]


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DEPARTMENT OF DEFENSE

Department of the Navy

32 CFR Part 726

[USN-2008-0009]
RIN 0703-AA85


Payments of Amounts Due Mentally Incompetent Members of the Naval 
Service

AGENCY: Department of the Navy, DoD.

ACTION: Final rule.

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SUMMARY: The Department of the Navy amends its rules to update existing 
sections relating to the authority and procedures to designate trustees 
for Navy and Marine Corps service members who have been determined to 
be mentally incompetent pursuant to 37 U.S.C. Chapter 11. The 
amendments will comport with current policy reflected in Chapter XIV of 
the Manual of the Judge Advocate General (JAGMAN).

DATES: This rule is effective October 29, 2008.

FOR FURTHER INFORMATION CONTACT: Lieutenant Commander Tanya M. Cruz, 
JAGC, U.S. Navy, Office of the Judge Advocate General (Administrative 
Law), Department of the Navy, 1322 Patterson Ave., SE., Suite 3000, 
Washington Navy Yard, DC 20374-5066, telephone: 703-614-7245.

SUPPLEMENTARY INFORMATION: The Department of the Navy published a 
proposed rule at 73 FR 38350 on July 7, 2008, to amend regulations 
concerning the authority and procedures to designate trustees for 
members of the Naval service who have been determined to be mentally 
incompetent in accordance with 37 U.S.C. Chapter 11. As a result of 
organizational change in the Office of the Judge Advocate General, the 
functions under Chapter XIV were transferred from the Judge Advocate 
General to the Defense Finance and Accounting Service-Cleveland Center 
(DFAS-CL), Office of Continuing Government Activity (CGA). No comments 
on the proposed rule were submitted. Accordingly, the Department of the 
Navy amends its rules concerning the authority and procedures to 
designate trustees for Navy and Marine Corps service members who have 
been determined to be mentally incompetent pursuant to 37 U.S.C. 
Chapter 11. It has been determined that this rule amendment is not a 
major rule within the criteria specified in Executive Order 12866, as 
amended by Executive Order 13258, and does not have substantial impact 
on the public.

Matters of Regulatory Procedure

    Executive Order 12866, ``Regulatory Planning and Review.'' It has 
been determined that the changes to 32 CFR part 726 are not considered 
a ``significant regulatory action.'' The rule does not:
    (1) Have an annual effect on the economy of $100 million or more or 
adversely affect in a material way the economy, a sector of the 
economy, productivity, competition, jobs, the environment, public 
health or safety, or state, local, or tribal governments or 
communities;
    (2) Create a serious inconsistency or otherwise interfere with an 
action taken or planned by another agency;
    (3) Materially alter the budgetary impact of entitlements, grants, 
user fees, or loan programs, or the rights and obligations of the 
recipients thereof; or
    (4) Raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles set forth in 
this Executive Order.
    Unfunded Mandates Reform Act (Sec. 202, Pub. L. 104-4). It has been 
certified that 32 CFR part 726 does not contain a Federal Mandate that 
may result in the expenditure by State, local, and tribal governments, 
in aggregate, or by the private sector, of $100 million or more in any 
one year.
    Public Law 96-354, ``Regulatory Flexibility Act'' (5 U.S.C. 601). 
It has been determined that this rule is not subject to the Regulatory 
Flexibility Act (5 U.S.C. 601) because it would not, if promulgated, 
have a significant economic impact on a substantial number of small 
entities. This rule implements the processing of the proper 
administrative processing and consideration of claims on behalf of and 
against the United States, and does not economically impact the Federal 
government's relations with the private sector.
    Public Law 96-511, ``Paperwork Reduction Act'' (44 U.S.C. Chapter 
35). This rule does not impose collection of information requirements 
for purposes of the Paperwork Reduction Act (44 U.S.C. Chapter 35, 5 
CFR part 1320). U.S.C. Chapter 35).
    Executive Order 13132, ``Federalism''. It has been certified that 
32 CFR part 726 does not have federalism implications as set forth in 
Executive Order 13132. This rule does not have substantial direct 
effects on:
    (1) The States;
    (2) The relationship between the National Government and the 
States; or
    (3) The distribution of power and responsibilities among the 
various levels of government.

List of Subjects in 32 CFR Part 726

    Administrative practice and procedure, Military personnel, 
Reporting and recordkeeping requirements, Trusts and trustees.

0
For the reasons set forth in the preamble, the Department of the Navy 
amends 32 CFR part 726 as follows:

PART 726--PAYMENTS OF AMOUNTS DUE MENTALLY INCOMPETENT MEMBERS OF 
THE NAVAL SERVICE

0
1. The authority citation for 32 CFR part 726 is revised to read as 
follows:

    Authority: 5 U.S.C. 301; 10 U.S.C. 5013, and 5148; 37 U.S.C. 
601-604, and 1001; 32 CFR 700.105 and 700.312.


Sec.  726.1  [Amended]

0
2. Section 726.1 is amended by removing the words ``title 11 of chapter 
37'' and adding the words ``Chapter 11 of Title 37'' in their place.


Sec.  726.2  [Amended]

0
3. Section 726.2 is amended by adding three new sentences to the end of 
paragraph (a) to read as follows:


Sec.  726.2  Scope.

    (a) * * * The Secretary of the Navy has authority to designate a 
trustee in the absence of notice that a legal committee, guardian, or 
other legal representative has been appointed by a State court of 
competent jurisdiction (37 U.S.C. 601-604). This authority is exercised 
by the Defense Finance and Accounting Service-Cleveland Center (DFAS-
CL), who has delegated it to DFAS-CL, Office of Continuing Government 
Activity (DFAS-CL(CGA)). Trustees receive the active duty pay and 
allowances, amounts due for accrued or accumulated leave, and retired 
pay or retainer pay, that are otherwise payable to a member found by 
competent medical authority to be mentally incapable of managing his 
affairs.
* * * * *


Sec.  726.3  [Amended]

0
4. Section 726.3 is amended by removing ``The Judge Advocate General or 
his designee'' and adding ``DFAS-CL (CGA)'' in its place.
0
5. Section 726.4 is revised to read as follows:

[[Page 64207]]

Sec.  726.4  Procedures.

    (a) Competency Board. (1) The commanding officer of the cognizant 
Naval medical facility will convene a board of not less than three 
Medical Department officers or physicians, one of whom will be a Navy 
psychiatrist or clinical psychologist, when there is evidence that a 
member may be incapable of handling his financial affairs. The board 
will be convened in accordance with Chapter 18, Manual of the Medical 
Department (MANMED). The board may include members of the Reserve 
components on active or inactive duty. When active duty Navy or Marine 
Corps members are hospitalized in non-Naval medical facilities, the 
Military Medical Support Office will ensure compliance with Chapter 18, 
MANMED.
    (2) DFAS-CL(CGA) may request the commanding officer of any Naval 
medical facility, or request the commanding officer of another service 
medical facility or administrator of a Department of Veterans Affairs 
medical facility, convene a competency board in accordance with this 
section to determine the mental capability of a member to manage his 
financial affairs.
    (3) A finding of restoration of competency or capability to manage 
personal and financial affairs may be accomplished in the same manner 
specified in Chapter 18, MANMED, except that the board may consist of 
one or two Medical Department officers or physicians, one of whom must 
be a Navy psychiatrist or clinical psychologist.
    (4) At least one officer on the competency board, preferably the 
psychiatrist or clinical psychologist, will personally observe the 
member and ensure that the member's medical record, particularly that 
portion concerning his mental health, is accurate and complete.
    (5) The requirement to convene a competency board under this 
chapter is in addition to and separate from the medical board 
procedures. Each board member signs the report of the board and 
certifies whether the member is or is not mentally capable of managing 
his financial affairs. After approval by the convening authority, the 
original board report is forwarded to DFAS-CL(CGA).
    (b) Records. The convening authority will forward the original of 
each board report to the Defense Finance and Accounting Service-
Cleveland Center, Office of Continuing Government Activity (Code CGA), 
Post Office Box 998021, Room 2323, Cleveland, OH 44199-80216. If a 
member is found to be not mentally capable of managing his financial 
affairs, the forwarding endorsement will set forth the name, 
relationship, address, and telephone number(s) of the member's next of 
kin, and any other information that will assist to identify a 
prospective trustee.

0
6. Section 726.5 is revised to read as follows:


Sec.  726.5  Procedures for designation of a trustee.

    Upon receipt of a report of a competency board that a member has 
been found mentally incapable of managing his financial affairs, DFAS-
CL(CGA) will initiate action to appoint a trustee, provided no notice 
of appointment of a committee, guardian, or other legal representative 
by a State court of competent jurisdiction has been received by DFAS-
CL(CGA).

0
7. Section 726.6 is revised to read as follows:


Sec.  726.6  Travel orders.

    The Chief of Naval Personnel or the Deputy Commandant, Manpower & 
Reserve Affairs, may issue travel orders to a member to appear before a 
competency board convened to determine whether the member is mentally 
capable of managing his financial affairs. In the case of permanently 
retired members, travel will be at no cost to the Government.

0
8. Section 726.7 is revised to read as follows:


Sec.  726.7  Status of pay account.

    Upon notification by the commanding officer of the medical facility 
preparing the board report that a member has been declared mentally 
incapable of managing his financial affairs, DFAS-CL(CGA) will suspend 
the member's pay. Thereafter, DFAS-CL(CGA) or his designee will direct 
payment of monies to:
    (a) The appointed trustee;
    (b) The legal representative appointed by a State court of 
competent jurisdiction; or
    (c) Directly to the member following a determination the member is 
capable of managing his financial affairs.

0
9. Section 726.8 is revised to read as follows:


Sec.  726.8  Emergency funds and health and comfort.

    Until a trustee is appointed, DFAS-CL(CGA) may appoint the member's 
designated next of kin to receive emergency funds equal to, but not to 
exceed the amount of pay due the incompetent member for a period of one 
month. These funds will be deducted from the member's pay account and 
will be used for the benefit of the member and any legal dependents.

0
10. Section 726.9 is revised to read as follows:


Sec.  726.9  Reports and supervision of trustees.

    (a) Accounting reports. The trustee designated by DFAS-CL(CGA) will 
submit accounting reports annually or at such other times as DFAS-
CL(CGA) or his designee directs. DFAS-CL(CGA) will provide forms to be 
used by trustees for the required accounting report. The report will 
account for all funds received from the Navy or Marine Corps on behalf 
of the member. When payments to a trustee are terminated for any 
reason, the trustee will submit a final accounting report to DFAS-
CL(CGA). Upon approval of the final accounting report, the trustee and 
the surety will be discharged from liability.
    (b) Failure to submit a report and default. If an accounting report 
is not received by the date designated by DFAS-CL(CGA) or an accounting 
is unsatisfactory, DFAS-CL(CGA) will notify the trustee in writing. If 
a satisfactory accounting is not received by DFAS-CL(CGA) within the 
time specified, the trustee will be declared in default of the trustee 
agreement and will be liable for all unaccounted trustee funds. If a 
trustee is declared in default of the trustee agreement, DFAS-CL(CGA) 
will terminate payments to the trustee and, if necessary, a successor 
trustee may be appointed. The trustee and surety will be notified in 
writing by DFAS-CL(CGA) of the declaration of default. The notification 
will state the reasons for default, the amount of indebtedness to the 
Government, and will demand payment for the full amount of 
indebtedness. If payment in full is not received by DFAS-CL(CGA) within 
an appropriate period of time from notification of default, the account 
may be forwarded to the Department of Justice for recovery of funds 
through appropriate civil action.

    Dated: October 21, 2008.
T.M. Cruz,
Lieutenant Commander, Judge Advocate General's Corps, U.S. Navy, 
Federal Register Liaison Officer.
[FR Doc. E8-25675 Filed 10-28-08; 8:45 am]
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