RECORD OF PROCEEDINGS


      IN THE CASE OF:


      BOARD DATE:        10 November 2005
      DOCKET NUMBER:  AR20050000186


      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             |
|     |Mr. John J. Wendland, Jr.         |     |Analyst              |


      The following members, a quorum, were present:

|     |Ms. Margaret K. Patterson         |     |Chairperson          |
|     |Ms. Linda D. Simmons              |     |Member               |
|     |Mr. Michael J. Flynn              |     |Member               |

      The Board considered the following evidence:

      Exhibit A - Application for correction of military records.

      Exhibit B - Military Personnel Records (including advisory opinion,
if any).

THE APPLICANT'S REQUEST, STATEMENT, AND EVIDENCE:

1.  The applicant requests, in effect, payment of educational loans under
the terms of the Loan Repayment Program (LRP).

2.  The applicant states, in effect, his Army recruiter and career
counselor assured him that his student loans would be paid in full under
the LRP incentive. He claims the Army now indicates that his loans received
from the Wells Fargo Education Financial Services (WFEFS) and Firstmark
Services do not qualify for repayment under the LRP and he was advised to
apply to this Board for relief.

3.  The applicant provides the following documents in support of his
application: WFEFS Loan Verification letter, dated 4 October 2004; two
Wells Fargo Collegiate Loan Application and Promissory Notes, dated 17 July
2002 and
2 August 2002; two DD Forms 2475 (DoD Educational LRP Annual Application),
dated 20 September 2004; two MI-LOAN Creditworthy Loan Applications, dated
28 August 2000 and 10 October 2000; a Firstmark Services Account Statement,
dated 7 January 2005; his DD Form 4 (Enlistment/ Reenlistment Document
Armed Forces of the United States) with Annexes, dated 16 March 2004; and
U.S. Army Human Resources Command (USA HRC), Education Incentives and
Counseling Branch letter, dated 2 December 2004.

CONSIDERATION OF EVIDENCE:

1.  On 16 March 2004, the applicant enlisted in the Regular Army for three
years. Annex C (Statement for Enlistment, U.S. Army Enlistment Program) to
his enlistment contract, dated 16 March 2004, confirms the options and
incentives the applicant contracted for during his enlistment processing.
The LRP is one of the incentives authorized and the applicable LRP terms
are listed in paragraph 2 (Associated Options) of this form.

2.  The LRP provisions of Annex C state, in pertinent part, that the
applicant understood he must disenroll from the Montgomery GI Bill (MGIB)
at the time he entered active duty and if he failed to do this he would not
be eligible for the LRP. It also indicated that the applicant understood
that the government will repay a designated portion of any loan he incurred
that was made, insured or guaranteed under Part B of the Higher Education
Act (Guaranteed Student Loan) or any loan under Part E of such act
(National Direct Student Loan) after 1 October 1975 and before he enlisted
in the Army.


3.  Annex C to the applicant’s enlistment contract further indicated that
the applicant’s enlistment for the LRP ensured him, provided he met and
maintained the prescribed prerequisites, that the portion or amount of his
student loans that could be repaid was 33 1/3 percent or $1,500, whichever
was greater of the unpaid principal balance for each year of service
completed up to a maximum of $65,000.

4.  On 16 March 2004, recruiting personnel completed Section V
(Recertification) and Section VI (Remarks) of the Record of Military
Processing - Armed Forces of the United States (DD Form 1966/3 and 1966/4).
 These documents contained an entry confirming the applicant’s
participation in the LRP.  There was no indication or entries regarding the
eligibility/ineligibility of any of his student loans.

5.  The applicant and Service representative signed both the DD Form 1966/3
and Annex C to his enlistment contract on the date he entered active duty,
16 March 2004, and there is no indication in these documents that any
questions were raised regarding the eligibility of his student loans for
repayment.

6.  The applicant's records contain a copy of DD Form 2366 (Montgomery GI
Bill Act of 1984) which shows the applicant completed the Statement of
Disenrollment from participating in the Montgomery GI Bill and signed the
document, along with a witnessing official, on 19 March 2004.

7.  On 2 December 2004, the Acting Chief, Education Incentives Branch, USA
HRC, notified the applicant that his WFEFS private loan, totaling
$8,429.23, which was not made, insured, or guaranteed under Title IV, Part
B, D, or E of the Higher Education Act of 1965, did not qualify for
repayment under the LRP.  The applicant was advised to apply to this Board
if he believed he had not been properly counseled or that an error or
injustice had occurred.

8.  During the processing of this case, an advisory opinion was obtained
from the Chief, Education Incentives Branch, USA HRC.  This USA HRC
official recommends disapproval of the applicant’s request based on his
WFEFS and Firstmark Services loans not being eligible for repayment under
the terms of the applicant’s enlistment contract because they were not
made, insured, or guaranteed under Title IV, Part B, D, or E of the Higher
Education Act of 1965 and there are no exceptions to the law that would
allow authorization of payment by USA HRC.

9.  The Chief, Education Incentives Branch, USA HRC, further states that if
the Board decides to grant compensation for the non-qualifying WFEFS
(Private Loan) and Firstmark Services (MI Loan) loans, the total
outstanding balance of
$18,520.30 should be paid directly to the applicant.  The USA HRC does
indicate that the applicant has qualifying loans in the amount of
$22,656.93 and $1,500.00 that are being repaid under the provisions of the
LRP.

10.  On 4 October 2005, the applicant was provided a copy of the USA HRC
advisory opinion in order to have the opportunity to reply to its contents.
 To date, the applicant has failed to respond.

11.  Army Regulation 601-210 (Regular Army and Army Reserve Enlistment
Program) prescribes eligibility criteria governing the enlistment of
persons, with or without prior service (PS), into the Regular Army (RA) and
the U.S. Army Reserve.  Chapter 6, section II, contains guidance on the
Guidance Counselor Processing Phase.  It states, in pertinent part, that
Guidance Counselors will use the supporting automated systems and updated
regulatory material applicable to military occupational specialty and
available options to counsel all applicants on their enlistment options.
It further states that Guidance Counselors will counsel applicants who fail
to meet specific qualifications for options for which they applied and
advise them of other available options.

12.  Table 9-4 of the enlistment regulation, in effect at the time of the
applicant’s enlistment, contained guidance on enlistment option Program 9C
(Bonus/Army College Fund/Loan Repayment Program).  It contained specific
guidance pertaining to the LRP and indicated that the government would
repay a designated portion of any loan incurred that was made, insured, or
guaranteed under Part B of the Higher Education Act of 1965 (Guaranteed
Student Loan) or any loan under Part E of such act (National Direct Student
Loan) after 1 October 1975 and before enlistment into the Regular Army.

13.  Table 9-4 of the enlistment regulation further stipulated that
Guidance Counselors were required to confirm they accomplished all the
processing procedures by making the appropriate entries in the enlistment
documents. This included a statement regarding the applicant’s eligibility
for the LRP, which included any factors that could disqualify him from
receiving the LRP benefit, and ensuring the applicant’s acknowledgement of
this fact was also recorded.

14.  The LRP is a Department of the Army enlistment option authorized by
Title 10 of the United States Code, section 2171 (10 USC 2171), which
provides the legal authority for the education loan repayment program for
enlisted members on active duty in specified military occupational
specialties.  The law states, in pertinent part, that loans that qualify
for repayment are Guaranteed Student Loan/Stafford Loans, National Direct
Student Loan/Perkins Loans, William D. Ford Loans, Supplemental Loans for
Students, Federally Insured Student Loans (FISL), Parent Loan for
Undergraduate Students (PLUS), Auxiliary Loan Assistance for Students
(ALAS), and consolidated loans which fall under Title IV, Part B or E of
the Higher Education Act of 1965, or William D. Ford Loan.

15.  10 USC 2171 further specifies that payment of such loans shall be made
on the basis of each complete year of service performed as an enlisted
member in a military occupational specialty specified by the Army.  The
Government will not make any payments to the Soldier or reimburse a Soldier
if he or she pays off a student loan.  The Government will only pay the
lending institution.

16.  Title 10, U.S. Code, section 1552, the law which provides for the
Board, states that, “The Secretary may pay, from applicable current
appropriations, a claim for the loss of pay, allowances, compensation,
emoluments, or other pecuniary benefits, or the repayment of a fine or
forfeiture, if, as a result of correcting a record under this section, the
amount is found to be due the claimant on account of his or another’s
service in the Army, Navy, Air Force, Marine Corps or Coast Guard, as the
case may be”.

DISCUSSION AND CONCLUSIONS:

1.  It is clear the applicant’s student loans did not meet the criteria
established by law and regulation to qualify for repayment by the Army
under the LRP.  The loans were not made, insured, or guaranteed under Title
IV, Part B, D, or E of the Higher Education Act of 1965, as is required.
However, this is not the overriding factor in this case given the equity
considerations and the resultant injustice.

2.  The Statement for Enlistment of the applicant’s enlistment contract
established a contractual agreement between the applicant and the Army, and
the record clearly shows the responsible recruiting officials failed to
make reference to any loans ineligible for payment under the LRP, as
evidenced by the absence of an entry in the remarks section of the DD Form
1966/4.

3.  The governing regulation requires Army Guidance Counselors to verify
and counsel applicants on their eligibility for the options they agreed to
prior to their departing for active duty.  Further, these counselors are
obligated to advise applicants on any options they agreed to, but are not
eligible for, and on any available alternatives.

4.  In addition, the enlistment regulation in effect at the time of the
applicant’s enlistment required counselors to add entries to the enlistment
contract and/or associated documents confirming this verification of option
and incentive eligibility, and/or counseling on ineligibility, prior to a
member departing for active duty.  In this case, counselors failed to
properly document the ineligibility of the applicant's loan on the DD Forms
1966/3 and 1966/4 prepared on the day he departed for active duty.

5.  The evidence of records shows, as required by the provisions of the LRP
in his Statement for Enlistment, the applicant disenrolled from the
Montgomery GI Bill following his enlistment in the Regular Army.

6.  In view of the facts of this case, it appears the applicant entered
into an erroneous contract with the Army, based on the failure of
recruiting personnel to follow established regulatory guidelines in
connection with his enlistment processing, through no fault of his own.
Given the failure on the part of Government officials to follow their own
regulations during the applicant's enlistment processing, it is appropriate
to rectify the resultant injustice at this time.

7.  In doing so, the applicant's military records should be corrected to
show his Statement for Enlistment was amended to include the sentence, “If
a student loan is accepted by the official processing you for enlistment as
payable under the LRP and the government fails to verify that the student
loan accepted actually is eligible under the Higher Education Act of 1965,
and such failure results in nonpayment of the loan by the LRP or the
repayment or default of the loan, the Army Board for Correction of Military
Records may pay the loan, at its sole discretion, in accordance with Title
10, U.S. Code, section 1552".  This would allow the Board to invoke that
provision and pay him the $18,520.30 due for the WFEFS (Private Loan) and
Firstmark Services (MI Loan) loans.

BOARD VOTE:

__MKP__  __LDS __  __MJF __  GRANT FULL RELIEF

________  ________  ________  GRANT PARTIAL RELIEF

________  ________  ________  GRANT FORMAL HEARING

________  ________  ________  DENY APPLICATION





BOARD DETERMINATION/RECOMMENDATION:

1.  The Board determined that the evidence presented was sufficient to
warrant a recommendation for relief.  As a result, the Board recommends
that all Department of the Army records of the individual concerned be
corrected by amending the applicant's Statement for Enlistment to include
the sentence, “If a student loan is accepted by the official processing you
for enlistment as payable under the LRP and the Government fails to verify
that the student loan accepted actually is eligible under the Higher
Education Act of 1965, and such failure results in nonpayment of the loan
by the LRP or the repayment or default of the loan, the Army Board for
Correction of Military Records may pay the loan, at its sole discretion, in
accordance with Title 10, U.S. Code, section 1552".

2.  That as a result of the foregoing correction, the Defense Finance and
Accounting Service (DFAS) shall remit payment to the applicant the total
amount of his Wells Fargo Education Financial Services and Firstmark
Services loans, in the amount of $18,520.30, to which he is entitled as a
result of this correction.  If required, the applicant will submit the
appropriate evidence (promissory notes, etc.) to the Defense Finance and
Accounting Service.




                                  _____M. K. Patterson________
                                            CHAIRPERSON



                                    INDEX

|CASE ID                 |AR20050000186                           |
|SUFFIX                  |                                        |
|RECON                   |YYYYMMDD                                |
|DATE BOARDED            |20051110                                |
|TYPE OF DISCHARGE       |(HD, GD, UOTHC, UD, BCD, DD, UNCHAR)    |
|DATE OF DISCHARGE       |YYYYMMDD                                |
|DISCHARGE AUTHORITY     |AR . . . . .                            |
|DISCHARGE REASON        |                                        |
|BOARD DECISION          |GRANT                                   |
|REVIEW AUTHORITY        |Mr. Chun                                |
|ISSUES         1.       |103.0100.0000                           |
|2.                      |                                        |
|3.                      |                                        |
|4.                      |                                        |
|5.                      |                                        |
|6.                      |                                        |


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