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B-214326 1 (1984-10-19)

handle is hein.gao/gaobadlyw0001 and id is 1 raw text is: THE COMPTROLLER GENERAL A OKCISION . . OP THE UNITED STATES WASHINGTON. 0. C. 20548 FILE: B-214326 DATE: October 19, 1984 MATTER OF: Applicability of the Government Losses in Shipment Act to shipment of U.S. securi- ties by commercial armored car carriers. DIGEST: The revolving fund established by section 2 of the Government Losses in Shipment Act (GLISA), 40 U.S.C. S 722 (1982) is not avail- able to provide replacement funds for losses of securities transported by commercial car- riers from registered mail facilities to Federal Reserve Banks, up to the amount of the carriers' liability/insurance coverage; the fund would be available to replace losses exceeding that amount. GLISA provides that fund shall not be available with respect to any loss of valuables of which shipment shall have been made at the risk of persons other than the United States * * *. 40 U.S.C. S 723. Under the standard shipping agreement, the private commercial carriers have assumed the risk of loss but only up to the amount of their stated maximum liability. This responds to the request by the Deputy Fiscal Assis- tant Secretary, Department of the Treasury, for our opinion on whether the Government Losses in Shipment Act, (GLISA) 40 U.S.C. SS 721-729 (1982) affords coverage for losses of Treasury securities transported by commercial carriers when the amount lost exceeds the carriers' insurance coverage. For the reasons given below, we hold that the fund established by the Act is available in these cases. Background The Bureau of the Public Debt regularly ships unissued marketable Treasury bonds and notes from Washington, D.C., to the Federal Reserve Banks and Branches. The bonds and notes generally travel part of the way by registered mail and part by private commercial carrier. The receiving banks take custody of the securities when they arrive at their destination postal facilities. In the past, the banks transported the securities from the postal facilities to their buildings in their own armored cars. How- ever, in recent years some of the banks have switched to using commercial armored car carriers because it is more economical

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