April
29, 2008
In
the Matter of the Petition by
JAVIER
A. YBARRA
3150
Christopher Street
Grand
Prairie, TX 75052-6011
P.S. Docket No. DCA 07-429
APPEARANCE FOR PETITIONER:
William Brown
APPEARANCE FOR RESPONDENT:
William S. Estep
Labor Relations Specialist
United States Postal Service
FINAL DECISION
UNDER THE DEBT COLLECTION ACT OF 1982
Petitioner, Javier Ybarra, filed a Petition for Hearing after receiving a Notice of Involuntary Administrative Salary Offsets dated December 7, 2007, from his postmaster. This Notice stated the Postal Service's intention to withhold $12,452.62 from Petitioner's salary to recover a stamp stock shortage.
A hearing was held in Dallas, Texas on March 4, 2008. The Postal Service presented testimony from an investigator from the Postal Service Office of Inspector General, a financial control analyst, and an auditor from the Postal Service Office of Inspector General. Petitioner testified in his own behalf and also presented testimony from his supervisor and his postmaster. Both parties relied on documents that had previously been filed, and Respondent submitted one additional document at the hearing. Respondent’s representative elected to file a written brief after reviewing the hearing transcript. The following findings of fact are based on the entire record.
FINDINGS
OF FACT
1. At all times pertinent to this case, Petitioner was a Customer Services Supervisor at the Grand Prairie, Texas Post Office. Since approximately November 2005, he was also the custodian of the unit reserve stamp stock at both the Grand Prairie Main Post Office and at Fountain Place Station. (Tr. 133, 148).[1]
2. A customer named Jensen did a large volume of business at Fountain Place Station. It is unclear exactly what type of business Mr. Jensen was engaged in, but he occasionally returned large quantities of obsolete stamps to be redeemed for new stamps.[2] Sometimes, because the volume of redeemed stamps was so large, Petitioner and his clerks did not immediately count and verify the amounts but would accept Mr. Jensen’s accompanying documents showing the amounts contained in each carton. Jensen told Petitioner that if errors were found he (Jensen) would pay the difference.[3] (Tr. 14, 123, 128, 134, 148-49, 151-52; PS Ex. p. 24).
3. In March 2006, Mr. Jensen delivered sixteen containers of stamps to Fountain Place Station to be exchanged. No one counted and verified the amounts in these containers. Based on his attached documents representing the amounts in each container, Mr. Jensen was given credit for $161,590.43. (Tr. 14; PS Ex. pp. 45-51).
4. In November 2006, during an audit being conducted by the Office of Inspector General, Petitioner discovered an error in Mr. Jensen’s March 2006 delivery. One container included an envelope purportedly containing 2166 sheets of 33¢ stamps, but which actually contained only 266 sheets – a difference of $12,540.00. Petitioner did not ask Mr. Jensen to make up the difference. (Tr. 12-15, 23, 53-54, 135, 149-50; PS Ex. pp. 24, 44-53).
5. In December 2006 and January 2007 various other audits were done in Grand Prairie, but the case file does not include records of those audits, and the record is not clear as to when, and by whom, all these audits were done.[4] In March 2007, the Office of Inspector General opened an investigation into apparent shortages at both the Main Post Office and Fountain Place Station. At some point, Petitioner and his postmaster concluded that there was a net shortage of $2,819.52 at Fountain Station and Petitioner signed a PS Form 3239, agreeing to pay that amount.[5] (Tr. 6-7, 9-10, 19, 48, 104-05; PS Ex. pp. 13-16, 18-19).
6. Because of the uncertainties involving several accounts, the lack of pertinent records, a belief that there had been some co-mingling of stamp stock between the two offices, and their awareness of the Jensen error, the IG investigator and auditors decided to do a complete audit of all the accounts at both the Main Post Office and Fountain Place Station.[6] This was done over a period of several days in late May/early June 2007, and included the unit reserve accounts, the retail floor stock accounts and the vending accounts. (Tr. 10-11, 47-48; PS Ex. p. 6).
7. The result of all the audits noted in Finding #6 was that the Main Post Office had a net overage of $882.92, and Fountain Place Station had a net shortage of $10,506.02. Combining the two, the overall net shortage was $9,623.10. The auditors did not re-examine the earlier audit(s) that resulted in the $2,829.52 shortage. Adding these two shortages together produces the $12,452.62 with which Petitioner is charged. (Tr. 28, 41-42, 47-52, 59-60, 66; PS Ex. pp. 30-31).
8.
During the May/June 2007 audits, Petitioner again told the auditors
about the error in Mr. Jensen’s redeemed stock that had been discovered in
November 2006. Shortly after the current postmaster
took over the Grand Prairie office in December 2006, she told Mr. Jensen that
her office would no longer accept his large redeemed stamp stock trades. Petitioner has had no discussion with Mr.
Jensen about the discrepancy in his March 2006 delivery and the IG Investigator
declined to answer questions about Mr. Jensen, stating that there is an ongoing
investigation. We do not know,
therefore, whether any Postal Service official has attempted to recover any
money from Mr. Jensen for the March 2006 error.
(Tr. 24-26, 53-54, 64, 112, 119, 149-50).
9. On November 21, 2007, Petitioner was issued a letter stating that he owed the Postal Service $12,452.62, and on December 7, 2007, he was issued the Notice of Involuntary Administrative Salary Offsets for the same amount. (Notice of Involuntary Administrative Salary Offsets attached to Petition).
DECISION
Respondent’s theory of liability is based both on the series of audits done in May and June 2007 (see Findings #6 and #7) and on the shortage in the March 2006 Jensen redeemed stamps delivery that Petitioner failed to count and verify (see Findings #3 and #4). The two amounts being nearly identical, $12,452.62 v. $12,540.00, Respondent presents this as a “take your choice” option.[7]
Petitioner contends that the multitude of audits, including audits of accounts for which Petitioner was not personally accountable, is too confusing to be relied upon. Further, he argues that his actions regarding Mr. Jensen were designed to accommodate a customer who was bringing a very large volume of business to the post office, and that the Postal Service is now making him a scapegoat rather than pursuing recovery from Jensen. Finally, he cites the testimony of his postmaster, who stated that it was wrong for Petitioner to have been assigned two very large unit reserve accounts, that she did not believe the IG audits were reliable, and that she issued Petitioner the Notice of Involuntary Administrative Salary Offsets only because she was directed to do so.
One 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.” Postal Service Handbook F‑1, Post Office Accounting Procedures (November 1996, Updated With Postal Bulletin Revisions Through June 9, 2007), §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.
The many IG audits
are not sufficient to establish a loss from any specific account that
Petitioner was accountable for. The
audits cover a wide span of time, they involve several accounts for which
Petitioner had no personal accountability (e.g., retail floor stock and vending
stock), and they show several large overages and shortages that may or may not
have a relationship to each other. Therefore,
to simply add them all up to produce a net shortage and hold Petitioner strictly
liable is contrary to the F-1 provision quoted above. (Albertha Johnson, P. S. Docket No. DCA
04-71 (August 23, 2004); Dale May, P. S. Docket No. DCA 02-381 (
The other prong of Respondent’s theory of liability is that we do not have an “unexplained” shortage here. Rather, Respondent argues, we know exactly what caused the shortage and that Petitioner was responsible for it, i.e., the so-called Jensen error. There is no dispute that in March 2006 Mr. Jensen was given credit for more stamps than he turned in and that this created a $12,540.00 loss. Clearly, it was not in accordance with proper accounting procedures to pay Mr. Jensen for redeemed stamps without immediately counting and verifying the amount. This mistake was compounded by Petitioner’s failure to discover it for several months.
Nevertheless,
Respondent’s case fails because Respondent has not made any showing that
attempts were made to collect this loss from Mr. Jensen. When there is another party ultimately liable
for a loss suffered by the Postal Service, Respondent has a duty to attempt,
with reasonable diligence, to collect from that party before charging the loss
to a postal employee. Darrell Kirby,
P. S. Docket No. DCA 02-498 (
The Petition is granted. Respondent may not collect $12,452.62 from Petitioner’s salary.
Bruce R. Houston
Chief Administrative Law Judge
[1] References to the hearing transcript are “Tr._.” References to the documents filed with
Respondent’s Answer, which are numbered as pages 1-55, will be “PS Ex._,”
indicating the page number.
[2] During Petitioner’s time at Grand Prairie, Mr. Jensen
returned well over a million dollars worth of stamps to be redeemed. (Tr. 107; PS Ex. pp. 4-7).
[3] The accounting procedure involved in accepting stamp
stock in this manner is that the amount of the redeemed stock would be placed
in the retail floor stock account and sometime later be transferred to the unit
reserve account, then eventually shipped out to the Stamp Distribution Office
for destruction. (Tr. 70, 151-52).
[4] The record contains a count sheet for an audit
conducted on November 20, 2006 by Petitioner and an IG auditor, showing a
shortage of more than $23,000 at Fountain Station, but this was explained by
the postmaster as being the result of an error in a shipment of stamps from the
Stamp Distribution Office and apparently plays no part in the alleged debt. (Tr. 77-81, 126-27; PS Ex. pp. 11, 33-34).
[5] Some time later, it was determined that there was an
arithmetic error and this amount was changed to $2,829.52. (Tr. 21-22; PS Ex. p. 54).
[6] The investigator also told Petitioner that his
agreement to pay $2,829.52 was not valid because the loss, including the Jensen
error, was much larger than $2,829.52.
(Tr. 10,140).
[7] In the IG Report of Investigation, the investigator
states that Petitioner is responsible for these two amounts added together, to
equal $24,992.62. That idea has apparently
been discarded, however, as no such assertion was made at the hearing or in any
of the letters issued to Petitioner. (PS
Ex. p. 4).