BNUMBER: B-274364 B-276306
DATE: April 23, 1997
TITLE: B-274364 B-276306
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B-274364
B-276306
April 23, 1997
Mr. David L. Gagermeier
Assistant General Counsel
Defense Finance and Accounting Service
Indianapolis Center
Indianapolis, IN 46249
Dear Mr. Gagermeier:
This responds to your letters of January 22, 1997 and August 19, 1996,
requesting relief of Lieutenant Colonel (LTC) H.G. Thigpen, Defense
Accounting Officer, Fort Stewart, Georgia, from personal liability for
improper payments in the amount of $6,944.33 and Lieutenant Colonel
(LTC) M.C. Mattingly, Fort Jackson, South Carolina, from personal
liability for improper payments in the amount of $6,754. For the
reasons stated below, we grant both of your requests for relief. In
addition, we also relieve LTCs Thigpen's and Mattingly's subordinates
who made the improper payments in question.
BACKGROUND
Your submissions indicate that the improper payments resulted from a
wide-ranging fraud scheme perpetrated by Sergeant First Class Robert
J. Lamb. Mr. Lamb received about $70,000 through 25 false claims to
Army, Air Force and Navy accounting and travel offices for
Do-It-Yourself (DITY) moves of personal property that he never in fact
made. The DITY program is a military program designed to save the
government money and provide a quick, informal way to facilitate
inexpensive moves of military personnel on short notice. Under the
DITY program, a member can present a voucher for advance payment of
the anticipated costs of moving to another post pursuant to military
travel orders. The member need not go to his or her own command or
even his or her own branch of the military to obtain such payments.
Instead, through a procedure known as "cross disbursing," any
command may make DITY advance payments to members based solely on the
presentation of appropriate paperwork and military identification
(ID). The member's service and/or command is then billed for
reimbursement after the fact.
Mr. Lamb, while absent without leave from the Florida National Guard,
altered his original travel orders requiring him to report to active
duty for training at Redstone Arsenal, Alabama, to show travel from
Florida to Fort Bliss, Texas. He submitted fraudulent documentation
directly to various base accounting and travel offices to receive
these payments. The U.S. Property and Fiscal Officer (USPFO),
Florida, became aware of Mr. Lamb's fraudulent DITY claims when a
clerk received billings for reimbursement from two different posts on
the same day. The USPFO contacted the U.S. Army Criminal
Investigation Division Command (CID) about the fraudulent claims. An
investigation by CID eventually led to Mr. Lamb's apprehension,
arrest, and prosecution.
Lieutenant Colonel Thigpen
On August 24, 1994, Mr. Lamb submitted his first DITY claim at a
branch office of the Fort Stewart, Georgia, finance office. Mr. Lamb
submitted his altered travel orders as well as a forged DD Form 2278
(Application for Do-It-Yourself Move and Counseling Checklist). Since
the documents were filled out correctly and he had a valid military
identification card, the clerk[1] prepared a travel voucher for Mr.
Lamb's signature. The voucher was loaded into the disbursing system
and Mr. Lamb received a Treasury check for $3,630.60. He signed the
check register acknowledging receipt of the check.
On August 26, 1994, Mr. Lamb submitted his second fraudulent DITY
claim at Fort Stewart, this time at the main finance office. He used
the same fraudulent orders and submitted another forged DD Form 2278.
Since the documents were filled out correctly and he had a valid
military identification card, the clerk1 prepared a travel voucher for
Mr. Lamb's signature. The voucher was loaded into the disbursing
system and he received a Treasury check for $3,613.73. He signed the
check register acknowledging receipt of the check.
Lieutenant Colonel M.C. Mattingly
On August 30, 1994, Mr. Lamb presented his altered travel orders to
the transportation office at Fort Jackson, South Carolina. Since the
documents appeared to be in order and filled out correctly the
transportation office prepared and certified a DD Form 2278. Mr. Lamb
then took this documentation to the travel branch at the finance
office at Fort Jackson. Since the documents were filled out correctly
and he had a valid military identification card, the clerk, Ms. Linda
Garland, prepared a travel voucher for Mr. Lamb's signature. The lead
clerk in the branch audited and certified the travel voucher and
loaded it into the disbursing system. Mr. Lamb received a Treasury
check for $3,140. He signed the check register acknowledging receipt
of the check.
Mr. Lamb waited until October 5, 1994 to submit his second fraudulent
DITY claim at the same Fort Jackson travel branch finance office.
This time he did not go to the transportation office but used the same
fraudulent orders and DD Form 2278 he used in the August 30, 1994
fraudulent claim. The clerk, Ms. Linda Garland, did not recognize Mr.
Lamb from his previous visit. Since the documents were filled out
correctly and he had a valid military identification card, she
processed the travel voucher for Mr. Lamb's signature but discovered
that he had already received a DITY payment using the same travel
orders. She informed Mr. Lamb of this and he advised that he returned
the advance to the USPFO in Florida because his wife was ill and they
had never made the move. Ms. Garland sought clearance from the lead
travel technician who advised her to call USPFO in Florida to receive
approval for the second payment. Ms. Garland called the USPFO in
Florida and obtained the necessary approval for the second payment,
although she does not recall who she talked to. The voucher was
audited, certified and loaded into the disbursing system and Mr. Lamb
received a Treasury check for $3,614. He signed the check register
acknowledging receipt of the check.
DISCUSSION
As the finance and accounting officer officially responsible for the
account,
LTCs Thigpen and Mattingly are personally liable for deficiencies in
their accounts caused by any improper payments made by their
subordinates. This Office has authority under 31 U.S.C. sec. 3527(c) to
relieve a disbursing officer from liability when the record indicates
that the disbursing officer acted within the bounds of due care; that
there is no evidence of bad faith on the part of the disbursing
officer; and that a diligent effort was made to collect the improper
payments. In cases where subordinates of the official actually
disbursed the funds, we have granted relief upon a showing that the
finance officer properly supervised his subordinates by maintaining an
adequate system of procedures and controls to safeguard the funds and
took steps to ensure the implementation and effectiveness of the
system. B-270480, Jan. 18, 1996; 62 Comp. Gen. 476 (1983).
As accountable officers, the disbursing clerks at Fort Stewart and
Fort Jackson are strictly liable for the deficiency in their accounts
resulting from the improper payments. 62 Comp. Gen. 476, 479-80
(1983). Under 31 U.S.C. sec. 3527(c), we may relieve a disbursing
official from liability for a deficiency resulting from an improper
payment if we determine that the payment was not the result of bad
faith or lack of reasonable care by the disbursing official, and that
diligent collection efforts were made. B-239122, Feb. 21, 1991.
Your letter and supporting documents establish that LTCs Thigpen and
Mattingly had in place and maintained an adequate system to
safeguard the funds for which they were responsible. Furthermore, the
travel clerks followed these procedures, including ensuring that the
payee was properly identified by a picture ID. There is no evidence
that the payments were the result of bad faith or lack of reasonable
care. Even an adequate and effectively supervised system of
procedures and controls cannot always prevent improper payments
resulting from criminal activity. B-270480, Jan. 18, 1996.
Collection Action
As indicated above, 31 U.S.C. sec. 3527(c) permits us to deny relief in
cases in which the agency has not taken diligent collection action.
Here the record indicates that when LTC Thigpen and LTC Mattingly both
learned of the frauds perpetrated by Mr. Lamb, they immediately began
collection action. Initial collection action was unsuccessful because
he was Absent Without Leave from the National Guard and did not have
any pay due him. After Mr. Lamb was given a dishonorable discharge
from the National Guard on May 5, 1995 the loss was referred to the
Directorate for Debt and Claims Management. The Directorate is
currently pursuing collection action against Mr. Lamb in accordance
with the Federal Claims Collection Standards, 4 C.F.R. Parts 101-105
(1995).
DITY Program Vulnerability
Finally, we note, as did the record compiled in the CID's
investigation, that because the DITY program is aimed at quickly
paying service members to move themselves and provide the government
with savings, it is susceptible to this type of fraud. For that
reason, the CID reports contain a number of suggestions intended to
reduce the vulnerability of the DITY program to fraudulent
manipulation of the type perpetrated by Mr. Lamb without significantly
impairing its utility to the Defense Department. The record reflects
that both LTCs Thigpen and Mattingly have
initiated new policies to prevent soldiers not from the local area
from receiving DITY advances. We trust that the Department of Defense
will consider these and other appropriate measures in order to reduce
the possibility for similar losses in the DITY program.
Accordingly, we grant relief to both LTC Thigpen, LTC Mattingly and
their subordinates.
Sincerely,
Gary L. Kepplinger
Associate General Counsel
B-274364
B-276306
April 23, 1997
DIGEST
Relief is granted to two finance officers who supervised an adequate
system of procedures and controls to safeguard funds in their care.
Their subordinates are also relieved since they complied with existing
procedures, there is no evidence that the payments were the result of
bad faith or lack of reasonable care and the improper payments
resulted from criminal activity that even an adequate and effectively
supervised system cannot always prevent.
1. Although the record is unclear, the travel clerks issuing the
payments were apparently Michael Davidson and Travis Proctor.