IN THE CASE OF:	  

		BOARD DATE:	  16 January 2009

		DOCKET NUMBER:  AR20080016024 


THE BOARD CONSIDERED THE FOLLOWING EVIDENCE:

1.  Application for correction of military records (with supporting documents provided, if any).

2.  Military Personnel Records and advisory opinions (if any).


THE APPLICANT'S REQUEST, STATEMENT, AND EVIDENCE:

1.  The applicant requests, in effect, remission or cancellation of his indebtedness in the amount of $17,351.61.

2.  The applicant states, in effect, he assumed custody of his daughter on 2 May 2005, and then turned over custody to her grandmother because he received an overseas assignment and could not bring her.  He claims the grandmother cared for his daughter until he was in a position to have her join him.  He claims he submitted his paperwork through his chain of command to the local finance office for determination of his entitlements based on his daughter, and they approved basic allowance for housing (BAH).  He states that he also received family separation allowance (FSA) when he deployed to Iraq.  However, his BAH and FSA were stopped and collected when he was assigned to Fort Sill, Oklahoma, which he believes is unjust given these benefits were originally approved by his chain of command and local finance officials.  He states that he now has court-ordered custody of his daughter.

3.  The applicant provides the following documents in support of his application:  self-authored statement; grandmother's statement; mother's statement; birth certificate (daughter); court custody order; finance battalion pay manager's memorandum for record (MFR), dated 7 March 2005; Criminal Investigation Division (CID) investigation packet; Iraq deployment orders; and U.S. Army Human Resources Command (HRC) memorandum, dated 12 September 2007.


CONSIDERATION OF EVIDENCE:

1.  The applicant’s military records show that as of the date of his application to the Board, he was still serving as a sergeant on active duty in Iraq.

2.  On 12 April 2005, the grandmother of the applicant's daughter completed a statement indicating that she was taking care of the applicant's daughter, who was born on 6 August 2001, while the applicant serves in the U.S. Army, and that the applicant was providing support for his daughter.

3.  On 2 May 2005, the mother of the applicant's daughter completed a notarized statement in which she indicated she was giving custody of her daughter, who was currently in the custody of her mother, to the applicant.

4.  In May 2005, while serving in Germany and receiving basic BAH differential, the applicant requested BAH with dependents (BAH w/DEP) based on his assuming responsibility (custody) for his daughter, and he provided all documents requested by local finance personnel to support this request.  His request was approved by his chain of command and the responsible local finance officials and he began receiving BAH w/DEP.

5.  On 19 February 2007, the pay manager of C Detachment, 39th Finance Battalion, Germany, prepared an MFR in which he indicated that he had researched the governing regulation that contained the policy for BAH that pertained to the applicant's specific circumstance.  Subsequent to this review, he informed the applicant he was authorized to receive BAH w/DEP and he instructed the applicant to submit the necessary paperwork.  He further stated that he reviewed the documents submitted by the applicant for accuracy and, given the applicant was a finance Soldier, approval was required and obtained from the applicant's company commander and from the 39th Finance Battalion military pay review branch, which was required for any actions for finance Soldiers.  He concludes by stating that the matter of the applicant's BAH is the result of a misinterpretation of the regulation by his servicing finance office.

6.  A CID Report of Investigation (ROI) completed by the Fort Sill, Oklahoma, CID Office, dated 20 June 2007, indicates that on 21 March 2007, a military pay office technician notified them that the applicant submitted fictitious paperwork to receive a higher BAH rate than authorized.  The ROI further indicated that an investigation revealed the applicant did not commit the offense of pay and allowance fraud as originally reported by a local finance technician and that the applicant had submitted paperwork to obtain BAH for his dependent based on guidance from his unit as he had sole legal custody of his daughter.

7.  Further, the FSA the applicant received while deployed to Iraq was started by finance based on the applicant's status as the legal guardian of his daughter.  The ROI further indicated that the supporting Staff Judge Advocate (SJA) opined that there was no evidence showing criminal intent on the part of the applicant to obtain unauthorized pay and allowances.

8.  On 24 August 2007, the Family Court of the Fifth Judicial Circuit, County of Richland, State of South Carolina, issued a custody order granting the applicant complete and sole custody of his daughter.

9.  On 12 September 2007, the HRC Chief, Operations Management Division, informed the Director, Defense Military Pay Office, Fort Sill, Oklahoma, that the application for remission or cancellation of indebtedness pertaining to the applicant was disapproved in the amount of $17,351.61.  This memorandum failed to provide the basis for the denial and instructed the applicant to apply to this Board if he felt an injustice occurred.  

10.  Army Regulation 600-4 (Remission or Cancellation of Indebtedness) provides instructions for submitting and processing applications for remission or cancellation of indebtedness to the U.S. Army.  Applications must be based on injustice, hardship, or both.  The regulation states, in pertinent part, that Soldier's debts to the U.S. Army may be remitted or canceled in cases arising from payments made in error to a Soldier, payments made in excess of an allowance on behalf of a Soldier, debts incurred while serving on active duty as a Soldier, and debts acknowledged as valid.

11.  Paragraph 1-12 of the same regulation contains guidance on determining injustice or hardship and states that the following factors will be considered:  the Army's policy in the area of indebtedness to the U.S. Army (for example, excess leave or BAH while living in Government housing); the Soldier's awareness of policy and procedures; past or present military occupational specialty, rank, years of service, and prior experience are taken into consideration; the Soldier's monthly income and expenses; the Soldier's contribution to the indebtedness to the U.S. Army by not having the situation corrected; and additional income or assets (for example, spouse's salary, savings account, and bonds).

12.  Paragraph 1-13 of the remission or cancellation of debt regulation outlines the following additional factors for consideration in determining injustice:  the applicant did not know, and could not have known, of the error; and the applicant inquired of a proper authority and was told that the payment was correct.

13.  Paragraph 1-14 of the same regulation outlines the following additional factors for consideration in determining hardship:  repayment will cause hardship because of excessive monthly expenses due to (1) living in a high cost area, 
(2) living apart from family members because of military orders, (3) number and age of family members, (4) medical and dental bills that cannot be reimbursed, and (5) other unusual expenses.  Expenses caused by living standards that are too high or by mishandling of funds are not a basis for a hardship case.

14.  Army Regulation 37-104-4 (Military Pay and Allowances Policy and Procedures-Active Component) provides Department of the Army policies for entitlements and collections of pay and allowances for active duty Soldiers.  It is used in conjunction with Department of Defense Financial Management Regulation (DODFMR), Volume 7, Part A (Vol 7A), DOD 7000.14-R.  Paragraph 28-2 states, in pertinent part, that if the Secretary of Defense or any designee determines that a Soldier is indebted to the U.S. Government as a result of an erroneous payment made to or on behalf of the Soldier by an agency of the U.S. Government, that debt may be collected.

15.  Paragraph 32-3 of the military pay regulation states, in pertinent part, that a claim against a Soldier or former Soldier arising out of an erroneous payment of pay and allowances may be considered for waiver when collection of the erroneous payment would be against equity and good conscience, and would not be in the best interest of the United States.

16.  Paragraph 32-4 of the same regulation states, in pertinent part, that a debt may not be waived merely because it resulted from administrative error.  It further states that no one is entitled to unearned compensation, and only in very unusual circumstances would equity and good conscience suggest that an individual should keep an overpayment.

DISCUSSION AND CONCLUSIONS:

1.  The applicant’s request for cancellation or remission of the debt he incurred as a result of erroneously receiving BAH w/DEP was carefully considered.  However, by regulation, the member must provide clear and convincing evidence of injustice or hardship to support approval of an application for cancellation/ remission of indebtedness.  Although he provides a CID ROI that confirms there was no criminal intent on his part in receiving BAH w/DEP, he failed to provide the cancellation or remission of indebtedness application packet he submitted to HRC that was ultimately denied with this application to this Board.  As a result, there is an insufficient evidentiary basis to support questioning the validity of or reversing the HRC denial decision in this case.

2.  By law and regulation, no one is entitled to unearned compensation, and only in very unusual circumstances would equity and good conscience suggest that an individual should keep an overpayment.  Absent any clear and convincing evidence to overcome the presumption of regularity attached to the HRC denial decision or that confirms unusual circumstances in this case, and/or of any independent evidence provided by the applicant that shows that repayment of the debt in question would present an undue financial burden on him or his family, there is also an insufficient equity basis to support remission or cancellation of his debt.

BOARD VOTE:

________  ________  ________  GRANT FULL RELIEF 

________  ________  ________  GRANT PARTIAL RELIEF 

________  ________  ________  GRANT FORMAL HEARING

___x____  ___x____  ___x____  DENY APPLICATION

BOARD DETERMINATION/RECOMMENDATION:

The evidence presented does not demonstrate the existence of a probable error or injustice.  Therefore, the Board determined that the overall merits of this case are insufficient as a basis for correction of the records of the individual concerned.



      __________x_______________
                 CHAIRPERSON
      
I certify that herein is recorded the true and complete record of the proceedings of the Army Board for Correction of Military Records in this case.

ABCMR Record of Proceedings (cont)                                         AR20080016024



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ABCMR Record of Proceedings (cont)                                         AR20080016024


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