In the Matter of the Petition by

MARIO C. MOJICA
2776 Bal Harbor Lane

               at

Hayward, CA 94545-3404

P.S. Docket No. DCA 01-156

APPEARANCE FOR PETITIONER:
Mario C. Mojica
2776 Bal Harbor Lane
Hayward, CA 94545-3404

APPEARANCE FOR RESPONDENT:
Howard E. Gibbs
Labor Relations Specialist
United States Postal Service
1675 7th Street, Room 421
Oakland, CA 94615-9401

Petitioner, Mario C. Mojica, filed a Petition requesting a hearing under the Debt Collection Act after receiving a Notice of Involuntary Administrative Salary Offsets stating the Postal Service’s intention to make deductions from his salary to recover for a shortage occurring in his window credit.

At Petitioner’s request, an oral hearing was held. The parties, witnesses and court reporter were at the Oakland Main Post Office in Oakland, California, and the Hearing Official participated by telephone from the Judicial Officer Department in Arlington, Virginia. The parties presented documents and testimony of witnesses and made oral closing arguments after the presentation of evidence was concluded.

The following findings of fact are based on the documents submitted and the testimony of the witnesses at the hearing.

1. Petitioner, a window clerk since 1996, was occasionally assigned to work as a window clerk at the Marcus Foster Finance Station in Oakland, California (Transcript of Hearing, Pages ("Tr.") 15, 33, 41, 47, 58; Respondent’s Exhibit ("RX") 3).

2. A drawer containing stamps and cash had been assigned to him at the Marcus Foster Finance Station, and Petitioner sold stamps and other postal items to customers from that drawer (Tr. 25, 41-42).

3. A spare key to the drawer was maintained by Petitioner’s manager in a locked safe in a sealed envelope that Petitioner himself had round-dated. That spare key and the key held by Petitioner were the only two keys to his drawer. Petitioner did not demonstrate that the spare key had been removed from the manager’s safe at any time relevant to these proceedings. (Tr. 16-18, 41).

4. Petitioner’s window position was protected by security glass, with money and postal products exchanged with customers through a trough in the counter below the window. It is very unlikely a customer could reach under the window to take anything on the counter on the clerk’s side of the security glass. (Tr. 19-21).

5. At some time before the events at issue in this proceeding, Petitioner discovered that an accordion file containing stamps was missing from his drawer. An immediate search did not turn up the file, but it was found a few days later in a compartment at the window. (Tr. 25-26, 42).

6. On April 23, 1998, as directed by Respondent, Petitioner reported to the Marcus Foster Finance Station at approximately 11:00 a.m. At the beginning of the day, his drawer contained about $100 in cash. (Tr. 15, 19, 41, 47).

7. At about 11:05 a.m., just after Petitioner began working at the window, a customer bought about $2,000 worth of money orders from Petitioner. Petitioner testified that because the customer paid with so many bills, he had to divide the cash into two stacks of roughly $1,000 each and put them in two different places in his drawer. (Tr. 19, 22, 44, 48, 53-54).

8. To serve a subsequent customer, Petitioner had to leave the window for a few minutes to go to the back of the office for a form. He is confident that he locked his drawer when he left. (Tr. 49-50, 52, 54, 56, 58).

9. Around 11:30 a.m., Petitioner was called upon to make an advance remittance of the cash in his drawer, but when he checked his drawer he found there was insufficient cash to cover the receipts from his money order sales. Upon counting, it was discovered that his drawer was short cash in the amount of $1,026.55. (Tr. 44-45).

10. The manager issued Petitioner a PS Form 1908, Financial Adjustment Memorandum, in the amount of $1,026.55, in effect adding cash to the remittance to make up his shortage so the deposit could be squared with his receipts (Tr. 31; RX 7, 8).

11. Issuance of the 1908 created an offsetting suspense item in the accounts of the station that was attributable to Petitioner’s shortage (Tr. 31; RX 11).

12. On May 25, 1998, Respondent issued Petitioner a Letter of Demand for Indebtedness seeking payment of $1,026.55 (Petitioner’s Exhibit ("PX") 1; RX 1).

13. Petitioner’s union filed a grievance challenging Respondent’s claim against Petitioner, and the union and management agreed to settle the grievance by reducing Petitioner’s liability to $502.79 (PX 2; RX 2-6, 9, 10).

14. Respondent issued Petitioner a Notice of Involuntary Administrative Salary Offsets stating its intention to collect $502.78 by involuntary deductions from Petitioner’s salary (RX 12).

15. On May 14, 2001, Petitioner filed a timely Petition for Hearing Under the Debt Collection Act, challenging Respondent’s collection of the $502.78 (Petition).

16. Postal Service regulations require that postal funds be kept secure:

"Keep postal funds inaccessible to the public and concealed from view. . . . When funds are not continuously observed, keep them in locked receptacles." (Handbook F-1, Post Office Accounting Procedures, November 1996, Section 151.41).

17. The regulation governing liability of Postal Service employees for losses to their accountabilities appears at Section 141 of the F-1 Handbook:

"141 Other Employees’ Liability

The postmaster or responsible manager consigns postal funds and accountable paper to other career employees. Employees 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, Section 141).

The amount at issue in this proceeding is $1,026.55, the full amount of the shortage claimed by Respondent. Although Petitioner’s union and management agreed to a compromise that would have reduced Petitioner’s liability to $502.79 (Finding 13), Petitioner rejected that settlement and challenged Respondent’s efforts to collect the reduced amount. Respondent asserted its right to collect the full amount of $1,026.55 from Petitioner’s salary given his rejection of his union’s settlement with management. In a telephone conference on June 12, 2001 (June 13, 2001 Order and Memorandum of Telephone Conference) and at the beginning of the hearing (Tr. 6-7), the Hearing Official cautioned Petitioner that the full amount of the alleged shortage was at issue in this proceeding and that a decision in Respondent’s favor could result in Petitioner being found liable for $1,026.55. Petitioner understood and decided to proceed with the hearing.

Respondent’s burden of proof in this case is to show that a loss occurred from an account for which Petitioner was responsible. Here, Petitioner does not dispute that cash in the amount of $1,026.55 was missing from his drawer on April 23, 1998. Within 30 minutes after taking in $2,000 in cash, Petitioner was $1,026.55 short when he was called upon to make a remittance of the cash in his drawer. The manager’s adjustment (Findings 10, 11) balanced Petitioner’s remittance, but the offsetting suspense entry to the office accounts reflected Petitioner’s shortage and demonstrates that Respondent suffered a loss of $1,026.55.

Respondent having demonstrated a loss, Petitioner will be held strictly accountable unless he demonstrates that he followed established procedures in managing his window credit (Finding 17). Petitioner presented testimony of his manager that he had not been short in audits of his accountability and that she was not aware of him leaving his drawer unlocked. This evidence supports an argument that he followed established procedures. However, that evidence is not sufficient to overcome the circumstantial evidence that Petitioner did not follow established security procedures in handling the cash he received for the money order sales. Petitioner sold the money orders about 11:05 a.m., receiving $2,000 in cash, which he testified he placed in his drawer with some difficulty, having to divide the cash into two bundles of about $1,000 each and to put them in two different places in his drawer. At 11:30 a.m., just over $1,000 of that cash was missing from his drawer (Findings 7-9). There is no direct evidence as to what caused the shortage. However, if Petitioner followed proper security measures regarding the cash, it is unlikely over $1,000 in cash could have disappeared from his drawer in the span of 30 minutes.

Petitioner’s defense is that someone must have taken the cash from his drawer. However, the only time he left his drawer was when he went to the rear of the office to look for a form a customer wanted (Finding 8). The customer waiting at his window could not have taken anything from Petitioner’s counter (Finding 4), much less the drawer below the counter. Petitioner has suggested theft by an unknown Postal Service employee, but he has provided no plausible explanation for how such a theft could have occurred.

Petitioner testified that his drawer was locked while he was away from the window. He speculates, therefore, that another employee must have had a key to his drawer. However, the spare key maintained by the manager had not been lost or made available to any other employee (Finding 3), and Petitioner has not shown that another employee would otherwise have had access to his drawer. Petitioner’s theory that another employee stole cash from his locked drawer is speculative and implausible.

Petitioner supports his theory that the cash was stolen by another employee by pointing to an incident some time before the loss at issue where an accordion file of his stamps was missing from his drawer and was later found in a compartment at the window (Finding 5). Petitioner argues that the only possible explanation for this series of events would be that another employee took the stamps using the spare key to Petitioner’s drawer. However, if another employee had stolen Petitioner’s stamps, it is unlikely they would have been left in an accessible compartment at the window line. An equally plausible explanation for the incident is that Petitioner left the accordion file of stamps in the compartment where they were found. These facts do not demonstrate that those stamps were stolen and do not demonstrate that someone else had a key to his drawer.

Petitioner has not demonstrated that he followed established procedures in managing his accountability. Accordingly, the Petition is denied. Respondent may collect the amount of $1,026.55 by deductions from Petitioner’s salary.

Norman D. Menegat
Administrative Judge