IRREGULARITIES COAST GUARD DEPOT, CURTIS BAY, MD.

A recent inspection by the General Accounting Office of the financial transactions of the United States Coast Guard Depot at Curtis Bay, Md., disclosed numerous irregularities and violations of law and regulations in connection with records and accounts of the chief pay clerk, a former chief pay clerk, a former assistant pay clerk (supply officer), and other officials, all of whom had previously had many years of service in the Coast Guard.

A brief summary of such irregularities and infractions of law and regulations will reveal the nature and extent of the illegal and unauthorized practices:

1. A shortage of $614.53 in the accounts of the chief pay clerk.

2. Mingling of official funds with personal funds in a private bank account.

3. Depositing funds into the Federal Reserve bank to the credit of the United States Treasury in a form other than that in which received. The amounts involved in such transaction totaled at least $1,633.39. 4. Withholding collections from deposit for long periods of time. 5. Cashing personal checks from official funds.

6. Converting official funds to personal use.

7. Failure to keep ledger accounts of collections and deposits subsequent to the time the chief pay clerk ceased to disburse in his own name. From available records, discrepancies amounted to $156.81. 8. Depositing moneys taken from the official pay-roll cash into the chief pay clerk's personal bank account to meet an overdraft therein due to withdrawal of funds for official settlement with Treasury.

9. Permitting the sale of commissary stock to the personnel residing at depot.

10. Chief pay clerk acting as commissary officer with knowledge, consent, and approval of the commandant of depot.

11. Neglect or refusal of chief pay clerk to turn over to dealers collections from personnel residing at depot, for the purchase of supplies and groceries for their personal use, converting the same to his own use without making settlement therefor. The amount unaccounted for: $249.50.

12. Using the accumulated profits from warrant officers' mess for personal gain.

13. Allowing personnel residing at depot to obtain both cooked and uncooked rations without payment therefor to the commissary.

14. Failure to account for collections from the sale of condemned materials and junk. Dealers' records indicated that such amounts diverted by officers amounted to $4,704.79.

15. Maintenance of privately owned mule and pony on reservation at Government expense.

16. Purchase of, and payment therefor with appropriated moneys, household supplies, equipment, and furniture for officers' quarters, over and above allowances under Army and Navy regulations, as well as numerous items and articles unauthorized by law or regulation.

17. Establishment of a so-called "slush fund" or "yard account" derived from the sale of junk and other sources, which fund was expended for unauthorized purposes, totaling $1,272.11.

18. Failure to maintain records of public property.

19. Use of Government-owned cars for the transaction of unofficial business of officers and their families.

20. Failure to invoice transfers of gasoline from one unit of the Coast Guard to another unit.

21. Work performed by depot personnel on privately owned automobiles during official hours.

22. Use by officers of the Coast Guard depot of gasoline from official tanks for unofficial purposes.

23. Unauthorized use by officials of Government credit for the purchase of personal requirements.

24. Coercion of pay clerks by commandant to effect payments for unauthorized purposes and for personal benefit.

25. Lack of adequate administrative check, verification, and control over the sale of salvage materials, stores, junk, and other properties belonging to the Government and the collections therefor as well as the deposit of the proceeds or receipt of funds derived from whatever

source.

26. Remittances covering deposits with bids not deposited by the chief pay clerk pending the acceptance of bids, but are returned to the unsuccessful bidders in their original form.

The attention of the Treasury Department has been called to these illegal and unauthorized practices for the collections of amounts due the United States, for administrative correction of the irregularities, and for such disciplinary action against the officers as may be warranted by the law and regulations.

GASOLINE TAX

The Congress has been advised in previous annual reports of the progress being made in effecting a return to the Federal Government of collections by States and the District of Columbia from the Federal Government of tax on gasoline purchases, ranging in amount from 2 to 7 cents a gallon, and of efforts to prevent such collections.

States exempting Federal personnel from the payment of gasoline tax. At the present time the following States will grant exemption to Federal personnel from gasoline-tax payments on official purchases upon presentation of credentials showing the official capacity in which traveling:

Non-exemption States and District of Columbia for Federal gasolinetax purchases.-The following States and the District of Columbia do not grant exemption from payment by the Government of gasoline. tax at time of purchase:

Refundment States and District of Columbia of gasoline tax received from Federal Government.-The following States and the District of Columbia refund to the United States amounts of gasoline tax illegally received therefrom upon presentation of duly authenticated claims:

Nonrefundment States of gasoline tax received from Federal Government. The following States will not refund to the United States payments of gasoline tax received, except on the part of the States by specific legislative action:

Audit for 1937 of receipts for tax paid on gasoline purchased by Federal travelers; results of, and amount of paid tax collected.-During the fiscal year 1937, there were audited in the claims division receipts showing the purchase by employees of the several departments and independent establishments of the Government traveling on official business in the several States of 37,631.71 gallons of gasoline, on which a tax of $1,295.41 was paid. Of this amount there has been recovered the sum of $785.14 or 60.61 percent of the total amount paid, which together with the amount of $222.85, collected on claims filed during the fiscal year 1936, makes a total collection of $1,007.99 for the fiscal year 1937.

Summary. A summary of the results of the audit, showing for each State and the District of Columbia the gallons purchased covered by the receipts audited and the tax paid thereon, and of the amount of paid gasoline tax recovered during 1937, follows:

Federal departments and establishments through which payments were made to States and District of Columbia for the gasoline tax collected during 1937.-The $1,007.99 gasoline tax collected during 1937 and restored to the Federal Government represents expenditures therefor by departments and establishments, as follows:

Departments and establishments through which collected tax was paid: Collected tax Agriculture, Department of

Commerce, Department of.

Federal Emergency Administration of Public Works

Interior, Department of the.

Justice, Department of __

$22. 41

14. 72

65. 36

13. 97

50. 26

774.99

63. 11

3. 17

1, 007. 99