October 19, 2007
In the Matter of the Petition
by
JOHN CAMACHO
P.S. Docket No. DCA 07-201
APPEARANCE FOR PETITIONER:
Albert E. Lum
APPEARANCE FOR RESPONDENT:
Martha T. Claye
Labor Relations Specialist
United States Postal Service
FINAL DECISION
UNDER THE DEBT COLLECTION ACT OF 1982
Petitioner, John Camacho, filed a Petition for Hearing after receiving a Notice of Involuntary Administrative Salary Offsets from his postmaster on June 19, 2007. This Notice stated the Postal Service's intention to withhold $7,214.64 from Petitioner's salary to recover a loss from a stamp stock account for which Petitioner was accountable.
A hearing was held in El Paso, Texas on August 21, 2007.[1] The Postal Service presented testimony from a finance manager, a financial control analyst, a customer services manager, and a supervisory clerk. Petitioner testified in his own behalf. Both parties relied on documents that had previously been filed, and Petitioner submitted one additional document at the hearing. The following findings of fact are based on the entire record.
FINDINGS
OF FACT
1. Petitioner has been the Station Manager of Ranchland Station in El Paso since March 2004. Before that he was a supervisor and then Acting Station Manager. He has been the custodian of the unit reserve stamp stock at Ranchland at least since some time in 2003. (Tr. 19, 25, 38-39, 43-44, 73).[2]
2. On March 17, 2004, about the time he became station manager, Petitioner and another individual conducted an audit of the unit reserve. They found the account to be $11,768.34 short. The opening balance for the account was $92,749.62, but their count showed only $80,981.28 present. This result was recorded on a PS Form 3294, Cash and Stamp Stock Count and Summary, that was signed by Petitioner and the other employee. This shortage was placed in “suspense,” an office accounting designation that restored the unit reserve account to a balanced condition as of that date, i.e., the accountability was adjusted to $80,981.28 to match the value of stamps counted. (Tr. 24-25, 44, 83; PS Exs. B and F).
3. In May, 2004, with assistance from a district financial specialist, Petitioner reviewed the unit reserve account and conducted another audit in an attempt to find errors that might account for the large shortage discovered in March. They discovered that 100 coils of 37¢ stamps had been issued to the retail floor stock sometime before the March 17 audit, but not entered into the computer system. This reduced the March 17 apparent shortage by $3,700. Also, a $732.60 error involving stamps sent for destruction was discovered. (Tr. 13-15, 25-26, 45, 48; PS Ex. 2, p. 7; PS Ex. 4).
4. Their audit, done on May 26, 2004, showed a shortage of $74.00. (Tr. 11-13, 47, 64-65; PS Exs. 2, 3 and B).
5. The record is unclear as to the reason for the long delay in action being taken regarding the shortage found in March 2004, but Petitioner was issued a Notice of Debt Determination by his postmaster on January 2, 2007, alleging that Petitioner owed the Postal Service $11,768.34. (PS Ex. 1).
6. Following a series of letters and emails between Petitioner’s representative and various postal officials, Petitioner was given credit for the $4,432.60 discussed in Finding #3 and for another $125.10, based on two audits conducted in late 2006 and early 2007. (Tr. 17-18, 26-27; PS Ex. A).
7. Petitioner was issued the Notice of
Involuntary Administrative Salary Offsets for $7,214.64 by his postmaster on
DECISION
The standard for determining an employee’s liability in a case such as this provides that employees to whom postal funds and accountable paper are consigned “are held strictly accountable for any loss unless evidence establishes that they followed the postal procedures established when performing their duties.” Handbook F‑1, Post Office Accounting Procedures (November 1996), §141.
Respondent’s burden of proof in a case of unexplained shortage is to show that a loss occurred from an account for which the employee is accountable. Respondent is not required to prove any specific dereliction, or act of negligence, by the employee. When a properly conducted inventory, or audit, shows a stock shortage relative to a previously established balance, this constitutes proof of loss unless other evidence raises sufficient doubt about the accuracy of the inventory or the previously established balance, or otherwise suggests that there may have been no actual loss.
Respondent’s position is that the audit on March 17, 2004 was properly and accurately conducted and, less the two amounts for which Petitioner has been given credit, proves a loss of the alleged $7,214.64. Further, Respondent argues that Petitioner has made no showing that he followed established procedures, nor has he presented evidence to show any other basis for relief from the strict liability standard quoted above.
Petitioner contends that the actual loss is far less than the amount alleged. He bases this on an argument that the count of the stamps present in the unit reserve account on March 17, 2004 was inaccurate. To demonstrate this, he testified that, the night before the hearing, using the figures from the March 17, 2004 Form 3294, he re-calculated the dollar values of each denomination of stamps that were counted on March 17, 2004. He came to a total of more than $87,000, as opposed to the figure $80,981.28 that he and the other auditor recorded on the PS Form 3294 on March 17, 2004. (Tr. 57-63; Pet. Ex. 1).
There are a number of difficulties with Petitioner’s argument. First, it is not at all clear that the new calculations presented by Petitioner are more accurate than the March 17, 2004 figures. The figures on the Form 3294 and the inventory list are handwritten, with many numbers crossed out and re-written. Petitioner has not shown that all the numbers he chose to use for his calculation equate to the correct number of stamps in each denomination that were present on March 17, 2004. Second, the fact that it did not occur to Petitioner to check these numbers until the night before the hearing detracts considerably from the credibility of his theory. He had the opportunity to do so on the day the count showed the $11,768.34 shortage, and on any day since then, knowing that he could be held liable for this shortage. Finally, and perhaps most persuasive, the unit reserve was put into balance after the March 17, 2004 audit, using $80,981.28 as the new accountability (Finding #2). If the count was off by nearly $7,000, as Petitioner now contends, an overage in that amount should have appeared on the next audit two months later. No such overage was found (see Finding #4).
Petitioner also argues that some of the stamps that were on his inventory, showing that they were still part of his unit reserve on March 17, 2004, had actually been shipped out for destruction a few days prior to March 17, 2004. In his testimony, he pointed to a few line items on the March 17, 2004 inventory list and compared those to similar line items on a PS Form 17, dated March 13, 2004, listing stamps shipped for destruction. (Tr. 48-54; PS Ex. F, p. 7; PS Ex. 2, p.7). This analysis, however, does not prove that these were the same stamps. For example, it is certainly possible that 1120 “Uncle Sam” stamps were shipped out on March 13, as shown on the Form 17, but that another 1190 “Uncle Sam” stamps should have remained in the inventory, as shown on the inventory. Again, the persuasiveness of this argument is diminished by the fact that Petitioner failed to make it during, or immediately after, the March 17, 2004 audit, or even during the May 2004 attempt to discover the source of the shortage.
Respondent’s evidence is sufficient to prove the loss alleged, and Petitioner’s evidence does not establish a basis for relief from liability. The Petition is denied. Respondent may collect $7,214.64 from Petitioner’s salary.
Bruce R. Houston
Chief Administrative Law Judge
[1]
The hearing was conducted by the undersigned
Administrative Law Judge via speaker telephone from
[2] References to the hearing transcript are "Tr._." References to documents filed with Respondent's Answer, and in a supplement to the Answer, will be identified as “PS Ex._.” References to Petitioner’s exhibit will be “Pet. Ex. 1.”