P.S. Docket No. DCA 20-247

FINAL DECISION UNDER THE DEBT COLLECTION ACT OF 1982

The Postal Service seeks to collect two debts from Petitioner, Dona Roberts. The first debt is based on $4,000 of cash that was apparently stolen from a safe in Ms. Roberts’s office. Ms. Roberts had taken possession of the cash after it was found at a post office close to the one where she worked. The Postal Service does not allege that Ms. Roberts stole the cash, but it does argue that she is financially accountable for the loss. The second debt is for a unit reserve shortage of $8,250 following a unit reserve count conducted in early January 2020. In this case, however, there was no shortage reflected in the unit reserve count. Rather, the Postal Service asserts that Ms. Roberts improperly transferred stamp stock from the retail floor account to eliminate a unit reserve shortage.

FINDINGS OF FACT

Missing Cash

1. Ms. Roberts became the Santa Fe Postmaster in April 2018. In that capacity, she worked at the Santa Fe Main Post Office. (Tr. 2 at 142).
2. The De Vargas Mall Station is another postal facility near the Santa Fe Main Post Office and was under the overall supervision of Ms. Roberts. On December 11, 2019, Steve Sturgill, an employee at De Vargas, found $4,000 in cash underneath a desk (Tr. 1 at 12–13). After learning about the money from Mr. Sturgill, Ms. Roberts went to De Vargas with another colleague, William Bryant. Ms. Roberts, Mr. Bryant, and Mr. Sturgill then returned to the Santa Fe Main Post Office. Together, they counted the money and placed it in a safe in Ms. Roberts’s office.¹ (Tr. 1 at 19–20; Tr. 2 at 77).
3. Several weeks later, on December 26, 2019, while Ms. Roberts was out of the office on vacation, Mr. Sturgill entered Ms. Roberts’s office and discovered that the safe was open and the cash was missing² (Tr. 1 at 29). The $4,000 has never been recovered, but the Postal Service does not allege that Ms. Roberts stole it or had anything to do with its disappearance (Tr. 1 at 194).
4. The Postal Service issued a Letter of Debt Determination on June 2, 2020, stating its intent to collect a $4,000 debt based on the missing cash (Resp. Exh. 2 at 240). That letter does not include a notification of Ms. Roberts’s right to appeal under the Debt Collection Act. Ms. Roberts’s petition (filed on September 22, 2020) mentions numerous other notices from the Postal Service about this debt. The record does not include a Notice of Involuntary Administrative Salary Offsets, which typically includes an employee’s appeal rights under the Debt Collection Act. By proceeding with the petition, including participating in the hearing, Ms. Roberts has effectively waived the requirement for a formal notice of her appeal rights.

Unit Reserve Shortage

1. As of the beginning of December 2019, Ms. Roberts was the unit reserve custodian of the Santa Fe Main Post Office (Tr. 1 at 164, 256–57; Tr. 2 at 143). At that time, Ms. Roberts participated in a turnover audit of the unit reserve, and she agreed to be financially accountable for the unit reserve stock (Tr. 2 at 144).
2. On December 26, 2019, the Santa Fe Main Post Office received 300 coils of Item No. 740100, (Forever) US Flag stamps (flag stamps) with a value of $16,500, or $55 per coil (Resp. Exh. 7³ ; Tr. 1 at 272–75). The stamps were received into the unit reserve account that same day (Resp. Exh. 7 at 280). One hundred and fifty coils of the flag stamps were then transferred to the retail floor account on December 31, 2019 (Resp. Exh. 7 at 283).
3. As early as the summer of 2019, some of the offices under Ms. Roberts’s cognizance as the Santa Fe Postmaster were falling behind on their financial reporting obligations to the Arizona District Office (Tr. 1 at 99, 112–115; Resp. Exh. 3 at 249). This situation worsened by October 2019, and Ms. Roberts was notified that a team from the District would be visiting Santa Fe to conduct financial reviews. Originally, the District Team planned to review the financial records at only the Santa Fe Coronado office. (Resp. Exh. 3 at 245; Tr. 1 at 116). As discussed below, however, the team’s review included both the retail and unit reserve accounts at the Santa Fe Main Post Office.
4. The District Team arrived on the afternoon of January 2, 2020, and met briefly with Ms. Roberts and others in Santa Fe (Tr. 1 at 117). During this initial meeting, Ms. Roberts mentioned her concern about a shortage in the unit reserve account she had discovered in a “pre-count” she had done in advance of the visit. Ms. Roberts conceded that she had moved 150 coils of flag stamps from the retail account to the unit reserve account to eliminate that shortage. (Resp. Exh. 4 at 260; Tr. 1 at 304–07).  
5. An “Inventory by Segment” report from 5:17 a.m. on January 3, 2020, shows that the retail floor stock should have included 149 coils of flag stamps (Resp. Exh. 7 at 286).   
6. That same day at 5:29 a.m., Ms. Roberts and a colleague, Scott Mizen, conducted a count of the retail floor account. Mr. Mizen was not a retail clerk (Tr. 1 at 202–03). The count was conducted before Monica Moore, a member of the District Team, arrived that morning (Tr. 1 at 313). The count showed a shortage of $7,479.82. More particularly, the count report showed a “system quantity” of flag stamps of 149, meaning that the counters should have expected to find 149 coils of those stamps. The actual number of coils found by Ms. Roberts and Mr. Mizen was zero. Based on a value of $55 per coil, that represented a shortage of $8,195. (Resp. Exh. 7 at 288–93).
7. Later that morning, at 7:49 a.m., Ms. Roberts and Mr. Mizen completed a unit reserve count. That count showed a perfectly balanced account. (Resp. Exh. 7 at 294–300). The count report showed a system quantity of flag stamps of 150, and an actual count of 150 (Resp. Exh. 7 at 299).
8. On June 2, 2020, the Postal Service issued Ms. Roberts a Letter of Debt Determination stating its intent to collect an $8,250 debt based on the missing stamp stock (Resp. Exh. 5). As with the other debt discussed above, that letter does not include a notification of Ms. Roberts’s right to appeal under the Debt Collection Act. But here, too, by proceeding with the petition, including participating in the hearing, Ms. Roberts has effectively waived the requirement for a formal notice of her appeal rights.

DECISION

1. Missing Cash

The Postal Service seeks to hold Ms. Roberts accountable, rather than merely responsible, for the $4,000 in cash that was stolen from the safe in her office. The difference between accountability and responsibility is key to this decision. Responsibility relates to job performance, focusing on whether employees are properly performing their assigned job duties. Employees who fail to perform their job requirements may be suspended, fired, or otherwise disciplined for poor job performance. Accountability, on the other hand, relates to an employee's personal financial liability for the value of assigned postal assets. Thus, in addition to being held responsible for failing to perform assigned job duties, an employee may, in the appropriate cases, be held financially liable, i.e., accountable, for the value of postal assets entrusted to them. Pepe v. United States Postal Service, DCA 17-260, 2018 WL 4220788 (August 7, 2018).
As we have previously held, the imposition of personal financial liability (accountability) on a postal employee must be based on specific legal authority. Brown v. United States Postal Service, DCA 16-224, 2017 WL 5516571 (January 25, 2017). Here, the Postal Service relies on the Postal Operations Manual (POM) § 691.41 to support the imposition of financial liability. That section of the POM says that a postal employee must deposit money it finds “loose in the mail” into the bank and enter the transaction under accounting code AIC 126. The parties spent considerable time arguing about this provision’s applicability to the facts of this case. And the parties presented conflicting testimony about whether Ms. Roberts was told to deposit the money and enter it into AIC 126 in the Postal Service’s finance records. But those issues are not relevant to this decision. Most importantly, POM § 691.41 says nothing about accountability for an alleged violation of its requirements. In the absence of such a provision, the Postal Service’s reliance on this provision is misplaced.
The Postal Service also cites the Administrative Support Manual (ASM), § 271.31, which designates a “security control officer” at each postal facility. Presumably, the Postal Service believes that Ms. Roberts, as the Santa Fe Postmaster, served this function at the Santa Fe Main Post Office. This would be consistent with the ASM’s language assigning the security control function to the “installation head or designated manager or supervisor.” Id. Although not explicitly stated, the Postal Service thus suggests that Ms. Roberts is accountable for the stolen cash because she failed to adequately perform the responsibilities of the security control officer.
This argument fails because of the language in ASM § 271.2. That section provides that security control officers are responsible—but not accountable—for “all Postal Service property entrusted to them.” As discussed, this is the crucial distinction. Thus, even assuming Ms. Roberts was the security control officer, she cannot be held accountable for the lost cash under this provision.
The Postal Service also cited Sammy Sellers, DCA 99-427 (January 10, 2000) to support its position. That case, however, is not applicable to these facts. In Sellers, the Postal Service sought to hold a window clerk accountable for a shortage in his account when he failed to properly use AIC 126 for a check deposit. In that case, unlike this one, there was a specific provision in Handbook F-1, Post Office Accounting Procedures, assigning accountability to window clerks under the facts of that case. The presiding judge, therefore, was correct to hold the employee accountable for a shortage. But no such rule of accountability has been cited here to justify a similar result.
The Postal Service could still prevail under two other theories. First, we have held that even in the absence of legal authority, an employee may be held accountable for a financial loss if the employee personally benefited from the loss. Pearson v. United States Postal Service, DCA 15-337, 2016 WL 10572243 (June 24, 2016). Here, however, the Postal Service conceded that Ms. Roberts did not steal or otherwise benefit from the missing cash. Thus, this theory does not provide a basis for recovery of the debt.
Second, the Postal Service could prevail if it were able to show that a specific act of malfeasance or negligence by Ms. Roberts directly caused the loss. Ross v. United States Postal Service, DCA 14-308, 2015 WL 13647633 (January 9, 2015). But we have consistently held that the mere failure to follow a postal regulation, without more evidence, is not sufficient to meet this burden. Brown, DCA 16-224 (holding that failure to comply with postal regulation about the collection of money was not sufficient to impose accountability); Ross, DCA 14-308 (holding that failure to comply with postal policies was not sufficient to impose accountability). And as it relates to this case more specifically, Ms. Roberts’s failure to deposit the cash in the bank may have been negligent, and it may not have been in accordance with postal policies, but her actions do not rise to the level of having directly caused the loss within the meaning of our Debt Collection Act decisions. Brown, DCA 16-224 (holding that the unidentified thief directly caused the loss).
Therefore, in the absence of any provision in the POM, ASM, or any other postal regulation addressing accountability of a postmaster for the missing cash, the Postal Service has not proved that Ms. Roberts is accountable for the missing cash.

2. Unit Reserve Shortage

Unlike the missing cash issue, postal regulations do squarely place accountability for shortages in unit reserve accounts on the unit reserve custodian. Handbook F-101, Field Accounting Procedures, § 13-2.5. To hold an employee accountable under this provision, the Postal Service has the initial burden to establish that an actual loss exists in an account for which the employee was the unit reserve custodian. The Postal Service is not required to prove any specific dereliction or act of negligence by the employee. It is sufficient for the Postal Service to show that, after a properly conducted stamp stock count, there was a shortage in an account for which the employee was accountable. Chavis-White v. United States Postal Service, DCA 16-182, 2017 WL 5516568 (April 19, 2017). If the Postal Service meets its initial burden, the burden shifts to the employee to come forward with evidence sufficient to alleviate or offset the shortage. Elliott v. United States Postal Service, DCA 15-86, 2016 WL 10572244 (January 8, 2016).
As to the first element of the case, there is no dispute that Ms. Roberts was the unit reserve custodian of the Santa Fe Main Post Office at all times relevant to this dispute. As to a shortage in that account, the Postal Service concedes that the unit reserve count conducted on January 3, 2020, showed a perfectly balanced account. But the Postal Service believes that on that same day Ms. Roberts transferred 150 coils of flag stamps from the retail floor account to the unit reserve account to eliminate a shortage in the unit reserve account. If true, that fact would be sufficient to prove Ms. Robert’s accountability for the shortage.
As to a shortage itself, the Postal Service normally proves this element of its case by introducing the results of a properly conducted count of the unit reserve account. Here, however, that count does not show a shortage. Rather, the unit reserve account was perfectly balanced. The Postal Service therefore is relying on a different argument. It believes the unit reserve account balanced only because Ms. Roberts transferred 150 coils of stamps from the retail account to the unit reserve on the morning of January 3, 2020. That transfer, of course, left a shortage in the retail account, which then showed up on the retail account report prepared later that morning. For her part, Ms. Roberts strenuously disagrees with the Postal Service’s position. She denies making any transfer to eliminate a unit reserve shortage. 
After weighing the evidence and assessing the credibility of the witnesses, I conclude that it is more likely than not that Ms. Roberts did in fact transfer 150 coils of flag stamps from the retail account to the unit reserve account on, or shortly before, January 3, 2020. The evidence establishes that there should have been 150 flag stamp coils in the retail account that morning, but in fact there were none. The record also establishes that the missing stamps from the retail account match the stamp stock actually found in the unit reserve account. Although Ms. Roberts denies making any such transfer, she admitted that she had done just that when she talked to Ms. Moore in January 2020. During her discussions with Ms. Moore, Ms. Roberts conceded that just before the District Team arrived in Santa Fe, she conducted a “pre-count,” during which she discovered a shortage in the unit reserve account. She also conceded that she transferred 150 coils of flag stamps back to the unit reserve from the retail account—presumably to eliminate the shortage in the unit reserve account.
Therefore, a preponderance of the evidence supports the Postal Service’s assertion about the transfer back to the unit reserve account. And that transfer is sufficient to prove that Ms. Roberts is accountable for 150 coils of flag stamps valued at $8,250.

ORDER

The petition is granted in part and denied in part. The Postal Service may not collect the debt related to the $4,000 in missing cash. The Postal Service may, however, collect $8,250 by involuntary administrative salary offset for the 150 coils of flag stamps.