PROCEEDINGS

	IN THE CASE OF:     

	BOARD DATE:           16 May 2002                   
	DOCKET NUMBER:   AR2001058527

	I certify that hereinafter is recorded the true and complete record of the proceedings of the Army Board for Correction of Military Records in the case of the above-named individual.  

	Mr. Carl W. S. Chun		Director	
	Ms. Rosa M. Chandler		Analyst	

  The following members, a quorum, were present:

	Mr. Fred N. Eichorn		Chairperson	
	Mr. Roger W. Able		Member	
	Ms. Paula Mokulis		Member	

	The applicant and counsel if any, did not appear before the Board.

	The Board considered the following evidence:

	Exhibit A - Application for correction of military 
                records
	Exhibit B - Military Personnel Records (including
	            advisory opinion, if any)

FINDINGS:

1.  The applicant has exhausted or the Board has waived the requirement for exhaustion of all administrative remedies afforded by existing law or regulations.

2.  The applicant requests that the findings of Report of Survey (ROS) Number 3B-042-98 be changed, that he be relieved of financial liability for all missing Government funds, and that all moneys collected from him be refunded.

3.  The applicant states, in effect, that the subject ROS was initiated 8 months after he was relieved of his duties as Brigade Food Service Officer (FSO) on 4 February 1997; that his replacement noted a discrepancy in March 1997 when attempting to reconcile DD Forms 1544 (Cash Meal Payment Sheet, or Cash Sheets), but took no action until 7 months later; that his replacement assumed responsibility for Brigade food service operations and all Cash Sheets; that the non-commissioned officer (NCO) upon whom the applicant relied -- the Dining Facility Manager -- was convicted of larceny of $4,344; and that the proper administrative procedures for conducting a ROS were not followed.

4.  The applicant’s military records show that he was a First Lieutenant assigned to the 3rd Brigade, 4th Infantry Division, Fort Carson, Colorado.  In April 1996, he was designated as the Brigade FSO.  Later, on 10 September 1996, he was further designated as 3rd Brigade Main Dining Facility FSO.  As such, he was responsible for Cash Meal Books and all 50 pre-numbered Cash Sheets contained therein; the Cash Books and Cash Sheets are accountable items.

5.  During the Thanksgiving 1996 holiday, several Cash Sheets and $5,725.00 in cash were placed in the Brigade Main Dining Facility safe.  The facility was then closed on 29 November 1996 for renovations.  On 4 February 1997, the applicant was relieved of his duties as Brigade FSO and a new FSO was appointed.  There is no evidence that a change of duty inventory -- to include reconciling Cash Books, Cash Sheets, and cash -- was conducted.  When the new FSO attempted to reconcile the Brigade’s Cash Books and Cash Sheets, he found two Cash Books (286609 and 286610) had missing Cash Sheets that had been issued by the applicant during November-December 1996.  The Dining Facility Manager told him that the Cash Sheets and the funds collected thereon were locked in the safe located in the Brigade Main Dining Facility that was being renovated.  When the renovations were completed and the Brigade Main Dining Facility was returned to the Army, the safe was found opened.  No cash was in the safe and six Cash Sheets from Cash Book 286610 were missing.

6.  The Dining Facility Manager attempted to locate the missing Cash Sheets and the missing cash.  Attempts were made until August 1997 when the shortages were reported to the Brigade Commander.  On 10 September 1997, an AR 15-6 investigation was initiated.  Sworn statements, dated October 1997, indicate that, during the Thanksgiving Holiday Weekend, the 3rd Brigade Main Dining Facility 

served holiday meals and the Cash Sheets and an undetermined amount of cash 
was placed in the Dining Facility safe.  Administrative personnel at the facility stated that, on several occasions, they tried to get the applicant to deposit the cash and turn-in the Cash Sheets, but the applicant would either not return their calls or he indicated that he was too busy.  After Thanksgiving 1996, the facility closed for renovation and the matter was forgotten.

7.  The applicant provided a statement for the AR 15-6 investigation on 4 February 1998.  In it, he outlined the procedures he used in managing the Cash Books.  He also stated that shortly after he became the Brigade FSO, the Post Finance Detachment closed and all transactions were moved to Fort Sill, Oklahoma.  He was then required to deposit all funds in the Army Federal Savings Bank and send the Cash Sheets and the bank deposit tickets to Fort Sill. He also stated that the first time he used this procedure, he mailed all of the paperwork and the Cash Sheets to Fort Sill.  However, in late November or December 1996, Fort Sill changed the procedure and he was required to retain the Cash.  He surmised that the missing Cash Sheets could have been among the first batch of paperwork that he mailed to Fort Sill.  The applicant concluded by adding that his successor was the assistant FSO prior to assuming the responsibilities of the FSO, and that he [successor] signed for the Cash Books that were stored in the safe.  The applicant said he clearly remembered that because his commander would not sign his clearance papers until all of his receipts were cleared.  He stated that he had no proof that his successor signed for everything because he had moved several times and could not find his personal records.

8.  On 2 April 1998, the AR 15-6 investigation was completed.  It concluded that the proximate cause of the loss was the result of simple negligence on the part of the applicant.  The applicant negligently allowed cash to accumulate in the dining facility safe far beyond the regulatory limits.  He failed to accept and turn-in cash and Cash Sheets as required by his position and regulations.  He also failed to conduct a proper closeout inventory with the incoming FSO as required by regulation.  The investigation also determined that the system that was in place to track and account for cash and Cash Sheets at the time of the loss was inadequate in that it failed to hold individuals in the monetary chain of custody accountable.  All individuals, from assigned headcount personnel, through dining facility administrative clerks, to the FSO should have signed for all money and Cash Sheets every time there was a change of custody.  The investigating officer recommended that the applicant be held financially liable for simple negligence in the loss of the sum of $5,725.00 and the missing Cash Sheets.

9.  The AR 15-6 investigation, findings, and recommendation were accepted by the ROS appointing authority on 15 April 1998.  On 16 April 1998, the Brigade Executive Officer notified the applicant that he was being held financially liable for $2,695.80 (1 month’s pay) for losses investigated as a result of the subject ROS.  He was informed of his legal rights.

10.  The applicant submitted an undated rebuttal to the ROS in which he stated that he was prepared to pay $2,695.80 to the government, but wanted to dispel the notion that he was incompetent or did not care about his job.  He explained that his time was consumed by other events -- he went to the field to act as opposing forces for the 3rd Armored Cavalry Regiment; he was hurt playing flag football and required surgery; he went on convalescent leave from 4-8 October 1996; he submitted his resignation; and he went on leave from 26 November-6 December 1996.  The Dining Facility Manager was instructed to call the assistant FSO to turn-in cash during his absence.  He believes that his only mistake was that upon his return, he did not check to see what had taken place in his absence.  He stated that he never kept more than $1,500.00 cash in the safe at anytime.  He always turned-in cash the same day that he received it or the next business day. He stated that he had the lieutenant sign for the Cash Sheets.  He stated that he was enclosing a copy of his clearance papers to show that he was no longer accountable for military property or money and that he had cleared all of his hand receipts.  He also stated that he was offended that the ROS had suggested that he was incompetent and he did not care about his job.  He stated that he had done the job to the best of his ability and in accordance with his understanding of the regulations.  He was never informed that he was not following the appropriate procedures or that anyone had any concerns about his job performance.  He added, in retrospect, that there were probably some things that he could have done differently, however, he never had a cavalier attitude towards his job and he always did his best.

11.  The investigating officer, after considering the applicant’s rebuttal and examining the documents that he submitted, concluded that the preponderance of evidence did not change the original findings and recommendations.  The investigating officer stated that the applicant was assigned the duty of FSO and that it was his responsibility to oversee the proper and reasonable conduct of the dining facility in regards to the Cash Books and monetary accountability.  If problems existed in the system, it was his responsibility to find and correct those deficiencies.  The events mentioned in the applicant's rebuttal referring to his difficult schedule, hospitalization, and leave plans did not absolve him of his responsibilities and duties.  Additionally, the AR 15-6 investigation refuted the applicant's claim that a proper change of custody inventory was conducted.  

There was no proof that the applicant conducted the inventory and signed the Cash Sheets, Cash Books, and cash over to the new FSO, as was his responsibility.  The rebuttal was not accepted.

12.  On 5 June 1998, the subject ROS was reviewed by the Chief, Administrative and Civil Law Division, Office of The Staff Judge Advocate, Fort Carson.  The legal review pointed out that, by regulation, the applicant must be held liable for the full loss when public funds are involved.  Subject to that one objection, the ROS was found to be legally sufficient.

13.  On 10 June 1998, the applicant was advised that he was being held financially liable for the entire loss of public funds.  He was again advised of his rights and, on an unknown date, acknowledged this notification.  On 11 June 1998, the approving authority approved the ROS “To hold [applicant] financially liable in the amount of $5,725.00.”  There is no indication that the applicant requested reconsideration of this decision.

14.  General Order Number 35, Headquarters, Fort Carson, dated 8 September 2000, shows that on 3 March 2000, the Dining Facility Manager on whom the applicant relied was convicted of larceny of $4,344 between the period of 1 December 1997 and approximately 31 March 1998; of dereliction of duty between 1 November 1996 and 31 March 1998; of wrongful and dishonest solicitation of subordinates on diverse occasions between about 1 December 1996 and 30 April 1998; and of making a false official statement on or about 22 June 1998.  The Dining Facility Manager was found "not guilty" of stealing the $5,725 that was the subject of ROS Number 3B-042-98, even though he had direct responsibility for the missing funds.  

16.  The Record of Trial (ROT) indicates that the Food Program Manager testified during the Dining Facility Manager's court-martial that a 3-month audit of the Brigade dining facility records between 1996 and 1998 revealed large discrepancies in the cash collection procedures and totals.  He also testified that discrepancies of this magnitude could not have been accidental or mere mismanagement.  Dining facility personnel testified that the Dining Facility Manager ordered the use of blank sheets of paper as temporary cash sheets (an uncontrolled document) for the collection of cash from soldiers even when Cash Sheets were available.  In addition to being outside of the relevant regulatory guidance, these "temporary cash sheets" were not accounted for during the audit.  Dining facility personnel also testified that Cash and Cash Controls Sheets were placed in the safe and, later, both would be missing.  On one occasion, dining facility personnel brought this matter to the attention of the Dining Facility Manager and were told "not to worry about it, because the money would be back the next day."

17.  On 3 April 2002, the Army Review Boards Agency Legal Section reviewed the Food Service Manager's ROT and opined that, although the Food Service Manager was not convicted of larceny of the funds cited in the subject ROS, it was only because the evidentiary standard of beyond a reasonable doubt was applied.  The Legal Section stated that the preponderance of the evidence produced during the Food Service Manager's trial proved that he also stole the ROS funds and recommended that the applicant be granted full relief.

18.  On 10 April 2002, the applicant was notified that the staff of the Board had obtained a document that that was relevant to his case.  On 29 April 2002, the applicant telephonically responded to the notification and he was advised that the ROT concerning the Dinning Facility Manager's court-martial had been obtained and it was being considered in making a determination concerning his case.  He was also advised that the Board was obligated to provide him a copy of the ROT. He stated that he was not interested in reviewing the ROT.

19.  Army Regulation (AR) 735-5 (Policies and Procedures for Property Accountability) prescribes the basic policies and procedures for accounting for Army property.  It defines accountability and responsibility for public funds and provides in pertinent part that a person who receives or handles public funds has personal responsibility for safeguarding those funds until they are deposited with a disbursing officer.  A person is financially liable for the full value of the loss of funds when the loss is attributable to their personal negligence or misconduct.

20.  Army Regulation 735-5, Chapter 13 discusses the ROS system and states that the Government may impose a finding of pecuniary liability whenever negligence or willful misconduct is found to be the proximate cause of any loss, damage, or destruction of Government property.  The total amount of pecuniary liability for soldiers will be established as the equivalent of 1 month's basic pay at the time of the loss, or the actual amount of the loss to the Government, whichever is the lesser amount.  However, in the case of a loss of public funds, liability is assessed for the full amount of the loss.

21.  The Consolidated Glossary for AR 735-5 defines negligence as simple or gross, with simple negligence being the failure to act as a reasonably 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 reasonably 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.  Proximate cause is defined as a cause which, in a natural and continuous sequence, unbroken by a new cause, produced loss or damage and, without which, loss or damage would not have occurred.

22.  AR 30-1 (The Army Food Service Program) establishes policies, procedures, responsibilities, objectives, and basic standards for the Army Food Service Program in garrison and field training exercises.  Chapter 11 addresses the policies and procedures dealing with Cash Books, Cash Sheets, and cash collection and turn-in.  It states that Cash Books and Cash Sheets are accountable items and that Cash Books will be turned-in to the Finance and Accounting Officer within 2 working days of all Cash Sheets being used.  Cash will be turned-in whenever the cash-on-hand exceeds a certain amount (in the case of the 3rd Brigade Main Dining Facility, this amount was established as $1,500.00).

CONCLUSIONS:

1.  The Board concludes that the conclusion of the subject ROS is insupportable and that the applicant should be relieved of financial liability for the missing cash in the amount of $5,725.00 and reimbursed for all moneys collected as payment of this debt.

2.  Although the applicant did not perform his FSO duties in accordance with all pertinent regulatory guidance, his actions were not the proximate cause of the loss of the funds.  A review of the ROT of the Food Service Manager's court-martial indicates by a preponderance of the evidence that he had direct responsibility for the funds and that he misappropriated the $5,725.00.

3.  The fact the Dining Facility Manager was acquitted of the larceny of the $5,725.00 is not relevant to the ROS.  He was tried under the more stringent evidentiary standard requiring guilt beyond a reasonable doubt.  The evidentiary standard employed in a ROS is merely that a preponderance of the evidence show that an individual was responsible for a loss.  A preponderance of the evidence presented at trial clearly indicates that the Dining Facility Manager was the direct cause of the loss.

4.  The ROS was not initiated or concluded in a timely fashion; however, this flaw did not operate to deprive the applicant of his right to due process.  He was interviewed in the investigation phase, properly notified of the investigator’s intent to hold him financially liable, and provided the opportunity to rebut the investigator’s findings.  He was also properly notified of the approving authority’s acceptance of the ROS findings and recommendation to hold him financially liable, and of his appeal rights, to include petitioning this Board.

5.  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:

	a.  The findings of ROS 3B-042-98 are voided;

	b.  The individual concerned is relieved of financial liability in the amount of $5,725.00; and

	c.  All moneys collected from him for payment of this financial liability be refunded.

BOARD VOTE:  

__fne____  ____pm_  ___rwa__  GRANT AS STATED IN RECOMMENDATION

________  ________  ________  GRANT FORMAL HEARING

________  ________  ________  DENY APPLICATION

		__________Fred N. Eichorn______
		        CHAIRPERSON

INDEX

CASE ID	AR2001058527	
SUFFIX		
RECON	YYYYMMDD	
DATE BOARDED	20020516	
TYPE OF DISCHARGE	N/A	
DATE OF DISCHARGE	N/A	
DISCHARGE AUTHORITY	N/A	
DISCHARGE REASON		
BOARD DECISION	(GRANT)	
REVIEW AUTHORITY		
ISSUES         1.	128.1400	
2.		
3.		
4.		
5.		
6.		

The applicant was properly designated as the Brigade FSO and 3rd Brigade Main Dining Facility FSO.  As such, it was his responsibility to account for all Cash Books, Cash Sheets, and funds collected in the dining facility.  This included turning-in all Cash Books within 2 working days of all Cash Sheets being completed, and turning-in cash whenever the amount totaled more than $1,500.00.

The AR 15-6 investigation revealed that, after the Thanksgiving Holiday weekend, the 3rd Brigade Main Dining Facility had more than $5,000.00 in cash on hand.  The investigation also revealed that the applicant was contacted and asked to make a turn-in, but he did not do so.  The investigation also revealed that the applicant left cash and Cash Sheets in the 3rd Brigade Main Dining Facility safe for more than 2 months during which civilian contractors were renovating the dining facility.  Finally, the investigation revealed that the applicant did not reconcile his accounts with his successor, as was his responsibility to do so.  It was the new FSO who discovered missing Cash Sheets and, ultimately, the loss of public funds.