BNUMBER:  B-272467.2 
DATE:  August 28, 1998
TITLE: [Letter], B-272467.2, August 28, 1998
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B-272467.2

August 28, 1998

Kenneth W. Hansen, Esq.
General Counsel
Export-Import Bank
  of the United States

Dear Mr. Hansen:

This responds to your letter dated February 5, 1998, advising us that 
certain information provided us in connection with our consideration 
of the Export-Import Bank's request for waiver of erroneous payments 
to three Export-Import Bank employees may have been false.  The 
waivers in question were included in waivers granted by our decision 
B-272467, December 13, 1996, to over 200 Bank employees.

You are concerned that in waiving the claims against these three 
employees we may have relied on material misrepresentations and 
omissions by these employees that, if known at the time, would have 
led us to deny the waivers.  You also state that, in your opinion, had 
the Bank known of the misrepresentation and omissions at the time the 
waiver applications were submitted, it is unlikely that the Bank would 
have sought waivers on behalf of these employees.

You are aware that the authority under which we issued these waivers 
has since been transferred to the Bank.  You state, however, that you 
are providing this information to us, as the agency that originally 
had the waiver authority, to correct the record and to seek our 
concurrence that the transfer of this authority included the transfer 
of authority to rescind waivers previously granted by our office if 
factual grounds to do so are determined to exist.

The waiver statute, 5 U.S.C.  sec.  5584 (1994), provided authority for our 
office to waive a claim, in whole or in part, against a person arising 
out of an erroneous payment of pay or allowances to an employee of an 
agency, the collection of which "would be against equity and good 
conscience and not in the best interests of the United States."  5 
U.S.C.  sec.  5584(a).  The statute specifically precluded our exercise of 
this authority if, in our opinion, "there exists, in connection with 
the claim, an indication of fraud, misrepresentation, fault, or lack 
of good faith on the part of the employee or any other person having 
an interest in obtaining waiver of the claim."  5 U.S.C.  sec.  5584(b).

We exercised our waiver authority under 5 U.S.C.  sec.  5584 (and our 
similar authority under 10 U.S.C.  sec.  2774 and 32 U.S.C.  sec.  716 
applicable to members of the uniformed services and National Guard) 
based on the written record before us.  4 C.F.R.  sec.  92.7(a)(1996).  
This record usually included a statement by the employee, member or 
other person having an interest in obtaining a waiver, and a report 
from the agency involved.  4 C.F.R.  sec.  92.3.  The agency's report 
included its statement of the circumstances under which the erroneous 
payment was made, the applicant for waiver's knowledge of the 
erroneous payment and the steps the applicant took, if any, to bring 
the matter to the attention of the appropriate official and the 
agency's response.  This report also was to contain the agency's 
determination as the whether there is any indication of fraud, 
misrepresentation, fault, or lack of good faith on the part of the 
employee and the factual basis for this determination.        4 C.F.R.  sec.  
92.3(a)(6).  We relied heavily on this information in making 
determinations on waiver requests.

It was our practice to grant reconsideration of our initial 
determination, either denying or granting a waiver, upon written 
request of the person from whom collection was sought or the agency 
involved based on full explanation of the errors alleged and the basis 
of the appeal.  4 C.F.R.  sec.  92.5(b).  In cases where we found that new 
relevant information or material facts warranted a determination 
different from the one made, we would reverse or modify the prior 
action.  While most reversals or modifications resulted from appeals 
by the person requesting the waiver, some reversals resulted from 
requests by the agency involved and resulted in our reversing a 
previously granted waiver that had been based on an erroneous or 
incomplete statement or understanding of the facts involved.  See 
Gerald A. Cavis, et al., B-259602, Nov. 27, 1995; and Maureen S. Fern, 
65 Comp. Gen. 696 (1986).[1]

As you know, effective December 18, 1996, sections 103(d), 105(b), and 
116, of Title I of the General Accounting Office Act of 1996, Pub. L. 
No. 104-316, 110 Stat. 3826 (1996), amended 5 U.S.C.  sec.  5584, 10 U.S.C.  sec.  
2774, and 32 U.S.C.  sec.  716, to transfer waiver authority, as it applied 
to executive branch agencies, to the Director of the Office of 
Management and Budget (OMB).  Section 101(a)(1) of this act provided 
that in any case where Title I of the act substituted another federal 
officer, employee, or agency to perform a function previously 
performed by the Comptroller General or the General Accounting Office, 
the authority under that provision to perform that function is 
transferred to the other federal officer, employee, or agency.

Section 101(a)(3) of the 1996 act authorized the Director of OMB to 
delegate waiver functions to any other agency or agencies.  Pursuant 
to this authority, effective December 18, 1996, the Director of OMB 
delegated the waiver function described in section 103(d) (waiver 
authority under 5 U.S.C.  sec.  5584) to the Executive branch agency that 
made the erroneous payment.  See Director of OMB's "Determination With 
Respect to Transfer of Functions Pursuant to Public Law 104-316," Dec. 
17, 1996.[2]  Therefore, pursuant to 5 U.S.C.  sec.  5584, as amended, and 
the Director of OMB's delegation of authority, the Export-Import Bank 
now has the same authority with respect to the waiver function that 
our office had prior to the transfer of authority, as it relates to 
erroneous payments made by the Bank.

Clearly, the Bank has authority to reconsider, reverse or modify, as 
appropriate,  the prior waiver action, where there is a showing that 
the Bank acted on the basis of some material mistake of fact, error of 
law, fraud or misrepresentation.  In our view, the Bank also has the 
authority to take such action with respect to prior waivers granted or 
denied Bank employees by our office.  This view is consistent with the 
well-established principle that a government officer may reopen a 
settlement or reverse a decision made by his predecessor in office 
"upon production of new and material evidence, or to correct manifest 
mistakes of fact such as errors in calculation, or for fraud or 
collusion."  See, e.g., Lt. Col. Cecil E. Pickens,         B-111513, 
Aug. 17, 1967; Eugene R. Thomas, B-155572, Aug. 22, 1966; 16 Comp.  
Gen. 51 (1936), and decisions cited therein.

Sincerely yours,

Robert P. Murphy
General Counsel  

1. See also, Isaac L. Tillman, B-266193, Feb. 23, 1996, where we 
rescinded a waiver action at the request of an interested agency based 
on a showing that we had misinterpreted the law.

2. By this same determination, the Director of OMB delegated the 
waiver authority described in Pub. L. No. 104-316,  sec.  105(b) and 116, 
applicable to members of the uniformed services and the National Guard 
(10 U.S.C.  sec.  2774 and 32 U.S.C.  sec.  716), to the Department of Defense.