| Mr. Carl W. S. Chun | Director | |
| Mrs. Nancy L. Amos | Analyst |
| Ms. Jennifer L. Prater | Chairperson | |
| Mr. Arthur A. Omartian | Member | |
| Mr. Patrick H. McGann | Member |
2. The applicant requests In effect, that he be relieved of all financial liability as indicated on Report of Survey (ROS) Number 04-01, document number W7350Y1094-0915.
3. The applicant states that financial liability was wrongfully levied against him due to the lack of due process, legal error, inadequate investigation, improper application of liability standards, and unfairness. He was the property hand receipt holder for the Information Management Office (IMO), Deputy Chief of Staff for Operations (DCSOPS), U. S. Total Army Personnel Command (PERSCOM) and as such he received and accounted for the automated data processing (ADP) equipment and subhand receipt of the equipment. The property is stored in either a locked file cabinet or a storage room located across the hall from him. Access to the room from which the laptop computers were stored and from which they were stolen is accomplished via a key in his possession and a duplicate key in the possession of Ms. F___ or Ms. Y___. They exercise daily physical control of the storage area and authorized persons to enter the storage area to obtain office supplies without any supervision or his knowledge. No one with access to that storeroom can be seen from his area. In fact, the storage area was found on numerous occasions to be unlocked both during duty hours and on weekends. He has always objected to this uncontrolled and compromising access.
4. The applicant states that PERSCOM does not recognize that the regulation does not mandate that someone be held liable if property is lost, damaged, or stolen. He was denied due process because this action was not conducted within the times prescribed by regulation. Liability standards were improperly applied. Even the value of the missing 3 compact laptops was computed incorrectly. The 3 missing laptops were over 8 years old and now worth $95.00 each if they are in good working condition pursuant to the technical personnel at COMPAQ Headquarters. To date, he has been denied access to the legal opinion that is required by regulation to be attached to the ROS.
5. The applicant states that the failure by his superiors and PERSCOM to provide him with appropriate facilities to safeguard government property, in addition to the theft committed by persons unknown, is the proximate cause of the loss. There was nothing he could do as a reasonably prudent man to catch the thieves or preclude the thefts.
6. Supporting evidence is as listed on the attachment to the DD Form 149.
7. Counsel makes no additional contention.
8. The applicant was/is a GS-12 Computer Specialist with IMO, DCSOPS, PERSCOM.
9. In a memorandum dated 1 December 2000, the Chief, Information Technology Management Branch, DCSOPS, PERSCOM requested a cipher lock be installed on the outside door of the Information Technology Management Branch, DCSOPS. She noted that there had been numerous incidents of the door to the IMO shop being open, the occupants of the room complaining of missing software and other items, and instances of unknown persons turning on their computers. The Chief noted that the IMO shop was responsible for maintaining security for the Command Group and DCSOPS servers and it was not feasible to put hundreds of pieces of equipment away daily. Apparently this request was denied.
10. An inventory taken by the applicant of his hand-receipted property in March 2001 revealed that 3 laptop computers and a monitor were missing. The total unit price of the items was determined to be $8,216.00.
11. By email dated 12 March 2001, the applicant requested the Chief, Information Technology Management Branch put out a reminder note to the office that, if there is only one person in the office and that person leaves, that person should close the front door prior to leaving.
12. By email dated 13 March 2001, the applicant sent an email to Ms F___ requesting she shut the door behind her when she leaves the office and the office is empty.
13. A DA Form 4697 (Department of the Army, Report of Survey) was prepared on 26 March 2001 and signed by the accountable officer and given a document number on 16 April 2001. On 17 April 2001, an ROS officer was appointed.
14. Sworn statements were taken by the ROS officer. Most of the statements noted that the office door was found to be unsecure at times and that a cipher lock had been requested for the door but the request was denied.
15. On 1 May 2001, the ROS officer spoke with the previous (from June 1997 to May 1999) IMO. That individual stated that he went over the hand receipts with the applicant. The hand receipt was straight upon his departure as he reviewed it. He stated that during his tenure there was always a problem with people wanting a laptop at the last minute and it was a struggle to maintain control simply due to the volume of requests, amount of equipment, etc. He believed the applicant was very responsible and conscientious regarding property control
16. By email dated 2 May 2001, the Chief, Property Management, PERSCOM informed the ROS officer that the applicant should have completed an inventory in February 2000. They had been involved in a series of office changes and the inventory was not conducted by the previous manager.
17. On 14 May 2001, the ROS officer found the applicant to have been negligent with regard to maintaining property accountability and his failure to maintain accountability was the proximate cause of the loss. He recommended the applicant reimburse the government $475.00.
18. The ROS officer noted that all office personnel have keys to the office in question and that several individuals found the office door unlocked and/or open after it had been secured the previous evening. However, the missing equipment was not reported missing after those instances nor was there a record of an inventory being conducted in the 2-year period in question. Therefore, he could not conclude that those security lapses were the cause of the missing equipment. Similarly, he noted that no inventories or reports of the equipment being missed occurred after occasions when the door was found unexpectedly unlocked, so he ruled out theft.
19. The ROS officer noted that, with respect to the possibility of the missing items being turned in without documentation or given out without a subhand receipt, he noted that no one can remember these specific missing items nor has any paperwork been found to substantiate such a hypothesis. He noted that if he assumed that the applicant consented or gave permission for people in the office to give out equipment, tell him after the fact, and then he would do the paperwork, the ROS officer would still find the applicant negligent for allowing items to be removed without the appropriate documentation being in place. If the ROS officer assumed such actions happened without the applicant's knowledge or consent, then the applicant should have taken action to prevent future instances of it occurring as soon as he became aware of it. Since there were no witnesses to such actions having taken place with regard to the missing items, the ROS officer could not find that either of those events occurred with respect to the missing equipment.
20. The ROS officer noted several administrative errors on the ROS, specifically, with the identification of the missing monitor. Given the administrative errors, the ROS officer still found that the applicant was missing a monitor but recommended he reimburse the Government $0.00 for the monitor. The ROS officer stated that the fair market value of the laptops could not be determined directly as the equipment was no longer manufactured and obsolete in terms of the specifications. Therefore, she found the fair market value by contacting resellers and using their estimate of the value.
21. On 22 May 2001, the applicant examined the findings and recommendations of the ROS officer and elected to make a statement. He stated that when he signed his hand receipt in February 1999 the 3 missing laptops were not on the hand receipt. He apparently did sign for the 3 missing laptops in July 1999. Around January 2000, he started the process of doing the annual ADP equipment survey; however, as the Chief, Property Management noted, that office was not only going through personnel changes but the office was also testing a new electronic bar code system (which was shelved). The applicant noted that there were almost daily concerns regarding the front door to the office, as well as the storage room, not being locked. He discussed with the leadership that he was concerned that property accountability could be lost if access was not restricted. He stated it was very difficult to be responsible for equipment when access was not limited.
22. On 5 June 2001, the appointing authority signed the DA Form 4697 concurring with the ROS officer's finding and recommendation that the applicant should be held financially liable in the amount of $475.00 for the missing equipment. The approval authority signed the DA Form 4697 on 8 June 2001.
23. By memorandum dated 10 July 2001, the approval authority notified the applicant that he was found to be financially liable in the amount of $475.00 under ROS 04-01. He was informed of his rights under Army Regulation 735-5, paragraph 13-40, including the right to request reconsideration, which could be submitted only on the basis of legal error.
24. On 24 July 2001, the applicant requested a copy of the legal opinion that was associated with the ROS. On 26 August 2001, he was informed by PERSCOM that the legal opinion could not be released as it was a predecisional recommendation and opinions exchanged between the Command and the Command Judge Advocate. He was informed the denial was in accordance with Title 5, U. S. Code, section 552(b)(5) and paragraph 3-200, Exemption 5, Army Regulation 25-55.
25. On an unknown date, the applicant submitted a request for reconsideration. His request is not available. His request was reviewed by the PERSCOM Appellate Authority and subsequently denied. He was informed that he could request a hearing concerning the amount of the debt, or the terms of any proposed repayment schedule, request an extension of the collection period, or submit an application to the Board.
26. On 19 September 2001, the applicant requested all recovery action be stopped. He noted that his daily concern for the security of property entrusted to him has not been seriously met by his supervisors and other staff members. For example, even after the loss of the subject computers and the promise by the Chief, Information Technology Management Office, the Chief released the key to Ms. Y___ and Ms. F___ again, thereby destroying his ability to exercise reasonable physical security. Recently he learned that Sergeant First Class N___ took a computer without any authority or paperwork. The indifference to safeguarding government equipment under his responsibility continues and is not of recent origin. Clearly, the operational environment of the office and lack of adequate security was the proximate cause of the loss.
27. The applicant further stated that it is a long established precedent that where management or the command's operational practices create a condition beyond the control of its subordinates and its foreseeable consequences result in damages or loss to the Government, then the Government must suffer the loss unless the employee was malicious or acting in a criminal manner. He was not reckless. In fact, his efforts to ensure physical security over the property and the facility were ignored by superiors.
28. Army Regulation 735-5 (Policies and Procedures for Property Accountability) prescribes basic policies and procedures in accounting for Army property and accounting for lost, damaged, or destroyed Army property. Paragraph 2-6c states that, at the user level, all on-hand property carried on property book records and or hand-receipted records will be inventoried annually or upon change of principal hand receipt holder, whichever occurs first.
29. Army Regulation 735-5, paragraph 2-8 states that responsibility is the obligation of an individual to ensure Government property entrusted to his or her possession and or supervision is properly used and cared for and that proper custody and safekeeping are provided. Paragraph 2-8a states that command responsibility is the obligation of a commander to ensure all Government property within his or her command is properly used and cared for and that proper custody and safekeeping are provided. Command responsibility includes ensuring the security of all property of the command, whether in use or storage. Paragraph 2-8c states that direct responsibility is the obligation of a person to ensure all Government property for which he or she has receipted is properly used and cared for and that proper custody and safekeeping are provided. Paragraph 2-8(f)(2) states that direct responsibility is a formal assignment of property responsibility to a person within the supply chain who has the property within his or her custody but not necessarily in their possession for their use.
30. Army Regulation 735-5, paragraph 13-5 states that ROSs will be initiated and processed within a specific number of days. For the Active Army, figure 13-1 states ROSs will be initiated (starts with the discovery of the loss) and completed within 15 days. The ROS investigation and recommendation process (starts after the document number is assigned by the accountable officer) will be completed within 40 days. Time used to notify the respondent of the ROS officer's recommendation to assess financial liability is not counted against these time constraints. The ROS adjudication process (starts upon receipt from the initiator or the ROS officer) will be completed within 20 days. The individual being charged will be notified of the decision to assess financial liability within 30 days.
31. Army Regulation 735-5, paragraph 13-28 states that a survey officer's responsibility is to determine the cause and value of the loss, damage, or destruction of Government property listed on the ROS and to determine if assessment of financial liability is warranted. That determination must follow from the facts developed during a thorough and impartial investigation. Before beginning the investigation the survey officer must have an understanding of the terms "responsibility, culpability, proximate cause, and loss" as each term impacts upon a determination of financial liability. Individuals may be held financially liable for the loss, damage, or destruction of Government property if they were negligent or have committed willful misconduct and their negligence or willful misconduct is the proximate cause of that loss, damage, or destruction. Negligence is defined as simple or gross, with simple negligence being the failure to act as a reasonable prudent person would have acted under similar circumstances. Gross negligence is defined as an extreme departure from the course of action to be expected of a reasonable prudent person, all circumstances being considered, and accompanied by a reckless, deliberate or wanton disregard for the foreseeable consequences of the act. Willful misconduct is defined as any intentionally wrongful or unlawful act dealing with the property concerned.
32. Army Regulation 735-5, paragraph 13-28 further states that whether a person's acts or omissions constitute negligence depends on the circumstances of each case. Among the factors to be considered are the type of responsibility the person had toward the property, the adequacy of supervisory measures or guidance for property control, the feasibility of maintaining close supervision over the property given the nature and complexity of the organization or activity supervised, and the extent supervision could influence the situation considering pressing duties or lack of qualified assistants.
33. Army Regulation 735-5, paragraph 13-28 defines proximate cause as a cause which, in a natural and continuous sequence, unbroken by a new cause, produced loss or damage and, without which, loss of damage would not have occurred.
34. Army Regulation 735-5, paragraph 13-29 states that the ROS officer must obtain and mark evidence, as exhibits, and attach to each copy of the ROS.
35. Army Regulation 735-5, paragraph 13-36 states that, upon receiving an ROS on which the approving authority believes financial liability is appropriate, the approving authority will obtain a legal opinion as to its legal sufficiency prior to determining whether to assess financial liability. The opinion will be attached to the ROS prior to the approving authority's review and decision. Paragraph 13-40 states that, before individuals are held financially liable, they must receive notice and the opportunity to exercise their rights. The notification memorandum with a copy of the ROS with all exhibits will be hand delivered to the person found financially liable. Paragraph 13-42 states that a request for reconsideration will be reviewed only on the basis of legal error (i.e., that the facts of the case do not support an assessment of financial liability). When the approving authority determines that liability should be continued, the approving authority will prepare and sign a memorandum to the appeal authority giving the basis for denying the requested relief. On receipt of a response from the appeal authority concerning the relief of continuation of financial liability, the approving authority will notify the individual by memorandum.
36. Army Regulation 25-55 (The Department of the Army Freedom of Information Act Program) provides policies and procedures for the Department of Defense implementation of the Freedom of Information Act (FOIA). Paragraph 1-100 states that Department of Defense records requested by members of the public who follow rules established by proper authority in the Department of Defense shall be withheld only when exempt from mandatory disclosure under the FOIA. Paragraph 3-200 lists exemptions to disclosure under the FOIA. Exemption 5 states that internal advice, recommendations, and subjective evaluations that are reflected in records pertinent to the decision making process of an agency are exempted from disclosure under the FOIA. Also exempted are records pertaining to the attorney-client privilege and the attorney work-product privilege. An example would be the nonfactual portions of staff papers, to include after-action reports, containing advice, opinions, or suggestions.
CONCLUSIONS:
1. The Board concludes that the time constraints in completing the ROS were not unduly violated. The loss was discovered on an unknown date in March 2001. The DA Form 4697 was prepared on 26 March 2001 and the accountable officer signed it on 16 April 2001. This appears to be outside the 15-day timeframe to complete this portion of the ROS but not excessively so. The ROS officer was appointed on 17 April 2001 and made her findings and recommendation on 14 May 2001. This was inside the 40-day timeframe to complete this portion of the ROS process. It appears the appointing authority gave the DA From 4697 to the approving authority on or about 5 June 2001, who signed the DA Form 4697 on 8 June 2001. This was inside the 20-day timeframe to complete this portion of the ROS process. The applicant was notified of the decision to assess financial liability on 10 July 2001. This was 2 days outside of the 30-day timeframe to complete this portion of the ROS process.
2. The applicant provides no evidence of the opinion provided him by technical personnel at COMPAQ concerning the value of the missing 3 compact laptops and so the Board cannot make a determination regarding the financial assessment.
3. The Board acknowledges that the regulation requires a legal opinion to be attached to the ROS; however, the regulation does not require the legal opinion to be provided to the concerned individual. The legal opinion is for the use of the approving authority in making his final decision regarding financial liability. It is exempted from mandatory disclosure under the FOIA.
4. Notwithstanding the above, the Board agrees with the applicant's contention that his case was inadequately investigated and that liability standards were improperly applied.
5. The Board does not excuse the applicant, nor his supervisors, for failing to perform the annual inventory that was required in January 2000. The reasons given for not performing it at the time may have been valid reasons to postpone the inventory but not to cancel it altogether. The missing items may or may not have been found during that inventory.
6. The Board concludes that the ROS officer dismissed the security issue without seriously investigating it. Army Regulation 735-5, paragraph 13-28 states that among factors to be considered when determining if a person's acts or omissions constitute negligence are the adequacy of supervisory measures, the feasibility of maintaining close supervision over the property given the nature of the activity supervised, and the extent supervision could influence the situation.
7. The Board notes that the applicant complained of the office door [containing the missing items] being found unsecure at times, a complaint that was substantiated in several of the sworn statements obtained during the ROS. The applicant requested additional security for the door in the form of a cipher lock and was turned down. However, the ROS officer dismissed the security issue by blaming the applicant for not conducting an inventory every time the door was reported unsecure. The Board concludes that it is unreasonable to believe his supervisors would have allowed him to shut down operations to conduct an inventory every time the door was reported unsecure.
8. The Board agrees with the applicant's contention that his command failed to provide him with appropriate facilities to safeguard expensive, pilferable Government property and therefore failed in its obligation to ensure proper custody and safekeeping are provided. Given this failure, the Board concludes that the applicant cannot be charged with even simple negligence.
9. In view of the foregoing, the applicant’s records should be corrected as recommended below.
RECOMMENDATION:
That all of the Department of the Army records related to this case be corrected by showing that the applicant was relieved of financial liability assessed by report of survey Number 04-01, document number W7350Y1094-0915 in the amount of $475.00.
BOARD VOTE:
__jlp___ __aao___ __phm___ GRANT AS STATED IN RECOMMENDATION
________ ________ ________ GRANT FORMAL HEARING
________ ________ ________ DENY APPLICATION
__Jennifer L. Prater__
CHAIRPERSON
| CASE ID | AR2003084140 |
| SUFFIX | |
| RECON | |
| DATE BOARDED | 20030923 |
| TYPE OF DISCHARGE | |
| DATE OF DISCHARGE | |
| DISCHARGE AUTHORITY | |
| DISCHARGE REASON | |
| BOARD DECISION | GRANT |
| REVIEW AUTHORITY | Mr. Schneider |
| ISSUES 1. | 116.01 |
| 2. | |
| 3. | |
| 4. | |
| 5. | |
| 6. |
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