BNUMBER:  B-271895
DATE:  September 3, 1996
TITLE:  [Letter]

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B-271895

September 3, 1996

Sidney L. Kaplan
Chairman             
Committee of Inquiry Into Fiscal Irregularities 
Department of State       

Dear Mr. Kaplan:

This is in response to your request that we grant relief from 
liability under 31 U.S.C.  sec.  3527 to Mr. John-Baptiste Diamesso, Class 
B Cashier, at the American Embassy in Brazzaville, Republic of the 
Congo, for the physical loss of $4,100 from his account.  As explained 
in further detail below, we grant relief .  

Sometime in August 1994, the United States Secret Service confiscated 
$1,500 in counterfeit notes from a State Department employee 
travelling on temporary duty to the United States.  Brazzaville 
Embassy records confirmed that the notes had been given to the 
employee by Mr. Diamesso.  A follow-up investigation by Secret Service 
special agents at Brazzaville determined that the cashier possessed an 
additional $2,600 in counterfeit U.S. currency.  It was later 
established that the counterfeit notes had all been received from the 
American Embassy Regional Finance Office in Kinshasa, Zaire, 
Brazzaville's usual source of supply for U.S. currency.  The Secret 
Service then found that a much larger amount of counterfeit currency 
was in the possession of the Kinshasa Cashier.  The Secret Service has 
determined that the 41 of Brazzaville's 100 dollar notes are 
"super-dollars", extremely high quality counterfeit notes which can 
only detected by expert forensic examination.  These notes easily pass 
visual and tactile inspection by experienced cashiers and cannot be 
detected by most commercial counterfeit detection machines.  

After reviewing the reports of the investigation the Committee of 
Inquiry Into Fiscal Irregularities, Department of State, determined 
that Mr. Diamesso was carrying out his official duties when the 
incident occurred and was without fault regarding the loss.  He 
observed all requisite procedures for receipt, documentation and 
handling pertaining to the maintenance of U.S. funds in his 
possession.  The Committee also concluded that there was no way Mr. 
Diamesso could have reasonably known or suspected that some of the 
U.S. currency in his care was counterfeit.

This Office may relieve an accountable officer of liability for 
physical loss of government funds if it concurs with the determination 
by the head of the agency, or any official delegated such authority, 
that the loss occurred while the officer was acting in his or her 
official capacity and was not the result of fault or negligence on the 
part of the officer.  31 U.S.C.  sec.  3527(a) (1988); B-261261, Aug. 31, 
1995.

We have held that a deficiency in an accountable officer's account 
resulting from the acceptance of counterfeit currency constitutes a 
physical loss.  See B-239724, October 11, 1990; B-101301, July 19, 
1951.  Although the acceptance of a counterfeit note may not amount to 
negligence if the counterfeit is not readily detectable (B-191891, 
June 16, 1980), if the quality of the counterfeit is such that a 
prudent person in the same situation would question the authenticity 
of the bill, relief should not be granted.  Id. B-239724, October 11, 
1990.  Also, failure to check a bill against a posted list of serial 
numbers of counterfeit bills will generally be viewed as negligence.  
Id.   

Here the loss resulted from the acceptance  of "super-dollars", 
extremely high quality counterfeit notes which the Secret Service 
concluded could not be detected by other than expert forensic 
detection.  Since the bills were not readily detectable as counterfeit 
and since he did not deviate from established operating procedures, we 
concur with the findings of the Committee and grant relief to Mr. 
Diamesso.

Sincerely,

Gary L. Kepplinger
Associate General Counsel

B-271895

September 3, 1996

DIGEST

Under the provisions of 31 U.S.C.  sec.  3527(a), we grant relief from 
liability for a loss of $4,100 to a Class B Cashier, at the American 
Embassy in Brazzaville, Republic of the Congo.  The loss resulted from 
the acceptance of "super-dollars", extremely high quality counterfeit 
notes.  Secret Service and Committee of Inquiry Into Fiscal 
Irregularities, Department of State, concluded cashier was carrying 
out his duties and was not at fault at the time of the incident.