BOARD DATE:	  23 October 2012

		DOCKET NUMBER:  AR20120014144 


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, full remission or cancellation of a debt in the amount of $28,554.80.

2.  He states he is being held liable for an error made by the finance office.  "Finance" claims he is responsible for half of a $28,554.80 debt incurred because he is supposed to review his leave and earnings statement (LES) and his financial status.  He did, and he attempted to change his marital status in 2009.  He also saw finance on five separate occasions and explained his situation.  No changes were made.  He asked the financial experts if he was entitled to basic allowance for housing (BAH) and family separation allowance (FSA), and finance approved the extra pay.  He wonders how much further he was obligated to go to ensure he was being diligent when finance had informed him BAH and FSA were approved.

3.  He provides his original request for remission or cancellation with supporting documents.  

CONSIDERATION OF EVIDENCE:

1.  The applicant's Army Military Human Resource Record does not contain documentation pertaining to his debt.  This case is being considered based primarily on the documents he provides.

2.  On 19 May 1990, the applicant accepted appointment as a Reserve commissioned officer of the Army in the Transportation Corps.  His record shows he entered active duty on 24 February 1991 and has served on active duty since that date.  He was promoted to major/O-4 effective 30 September 2004.  His most recent duty assignments have been in area of concentration 53A (Information Systems Management).

3.  On 22 January 2008, he was divorced from D------.  The Final Divorce Decree shows:

* he and his former spouse had two children born in 1992 and 1995
* he was obligated to provide support to his children until they reach age 18 or, if full-time high school students, until they reach age 19 or graduate from high school, whichever occurs first 

4.  The Final Divorce Decree incorporated a Separation Agreement (actually titled "Property Settlement Agreement") that shows, in part, the applicant and 
D------ agreed to have joint legal custody of their children with the children's primary residence being with D------.  They agreed the children would be with the applicant every other weekend and on 1/2 of all holidays and 1/2 of the summer if he lives within 100 miles of the children's primary residence with D------.

5.  On 16 October 2009, he was divorced from Y----.  The Final Order of Divorce does not show he had any dependent children from this marriage.  

6.  On 18 November 2009, he submitted a DA Form 2142 (Pay Inquiry) and DA Form 5960 (Authorization to Start, Stop, or Change Basic Allowance for Quarters (BAQ), and/or Variable Housing Allowance (VHA)) for the purpose of determining entitlements following his change in marital status.  Section III shows a staff member of a finance office determined his inquiry was invalid and that additional documentation was needed.  The staff member entered the following description of cause and action taken:

	The second divorce decree reflects no children were conceived within the marriage.  If the first divorce decree reflects that the Soldier [has] legal [and] physical custody of the child/ren [and] their name(s) [and] date of birth(s) is/are noted, then submit the 1st and 2nd divorce decrees with a DA Form 5960.  If the child(ren) names [and] date of birth(s) is/are not annotated, then submit the divorce decrees and birth certificate(s) along with a DA Form 5960 to your unit S-1/[Personnel Administration Center] representative.

7.  On 8 March 2012, the Director, Defense Military Pay Office (DMPO), National Capital Region (NCR), Fort Belvoir, VA, informed him he had an outstanding debt to the United States Government in the amount of $708.33.  He was informed that a collection would be entered against his military pay account by 7 April 2012 unless he protested the validity of the overpayment.  

8.  A DD Form 139 (Pay Adjustment Authorization), dated 8 March 2012, shows the Debt Management Section, DMPO/NCR, Fort Belvoir, VA, found he had received FSA in the amount of $708.33 for the period 6 January to 31 March 2011.  The form shows he was not entitled to FSA for this period.  

9.  On 14 March 2012, he made the following sworn statement:

	The information I submitted to Finance regarding my divorce decree, my application for [FSA], and all intentions to receive the appropriate and authorized entitlements and allotments are correct, accurate, and truthful.  I am requesting to retain already disbursed FSA funding without any further hardship to myself or my family.

	I deployed to Kuwait and arrived in country 7 [January 2011].  Shortly after arriving, I inprocessed and received a finance briefing explaining all the entitlements and allowances I would receive while deployed in Kuwait.  Finance representatives explained that FSA is only for those who are authorized.  I was not sure if I was authorized.  Finance instructed me to submit the request and if I was not entitled to receive FSA, Finance would not authorize funding.  It took me about a month to take the time to get back to the Finance office and submit the paperwork.  I did and Finance authorized FSA.  I was never told or asked that I needed to provide any additional paperwork supporting my request.

	I believe I was entitled to receive FSA because I have joint custody with my ex-wife or our two kids.  My divorce decree states this and the supporting separation agreement specifically states how custody will be split between us.  However, in a joint custody situation, one parent is still the [dominant] provider.  The court identified my ex-wife as the [dominant] provider.  I was not aware that FSA is authorized only if you have the kids in the home for 14 days or more per month, until after my deployment.  The [Fort] Belvoir Finance office informed me of this from [Department of Defense (DOD)] Financial Management Regulation Volume 7A, Chapter 27.  Now my separation agreement does not specifically state that but it does state, every other weekend, half of the summer, and half of all holidays.  If you add that up then you have the required 14 days per month (168 days total) averaged out over a 12 month period.

	There was no intent to defraud or mislead Finance so I could receive additional funding.  I feel that I did what I was rightfully told to do and someone within Finance made this mistake, not me.  I do not respect the idea of recouping funds already distributed with no fault of the Soldier.  Now, Finance is placing an undue hardship on the Soldier to pay back the funding disbursed in one lump sum or through a payment plan.  This will severely impact my ability to provide for my kids, to continue to pay child support, and to meet my everyday financial needs.  I request consideration [to] allow me to retain these funds without repayment.  I distributed these funds to my ex-wife for her use and care of the kids during my deployment.

10.  On 1 May 2012, the Director, DMPO, NCR, Fort Belvoir, VA, informed him he had an outstanding debt to the United States Government in the amount of $29,024.04.  He was informed that a collection would be entered against his military pay account by 31 May 2012 unless he protested the validity of the overpayment.

11.  A DD Form 139 (Pay Adjustment Authorization), dated 1 May 2012, shows the Debt Management Section, DMPO/NCR, Fort Belvoir, VA, found he had received unauthorized payment of entitlements as follows:

Entitlement
Period
Received
Entitled to
Difference
FSA
7 January 2011 - 31 January 2012
$3,216.66
$0.00
$3,216.66
Cost of Living Allowance (COLA)
13 January - 1 February 2012
$409.24
$0.00
$409.24
Hazardous Duty Pay (HDP)
14 January - 1 February 2012
$60.00
$0.00
$60.00
Basic Allowance for Housing (BAH)
7 January 2011 - 31 January 2012
$28,115.36
$2,777.22
$25,338.14
Total



$29,024.04
12.  On 8 May 2012, he made a sworn statement requesting to retain the BAH and FSA already disbursed.  He stated, in part:

I received a second outstanding debt notice from the [Fort] Belvoir Finance office stating that I have an outstanding debt of $29,024.04.  I agree that I was overpaid [COLA], $409.24, and [HDP], $60, and Finance may take that from my check in one lump sum.  The BAH and FSA I do not agree with and I am requesting to retain those funds in the amount of $28,554.80.  Those funds are unrecoverable because I provided those funds to my ex-wife to support our kids and to continue my mortgage in good standing.  Repayment of those funds would be a great financial hardship to me and my kids.

13.  He continues, stating, in part, finance representatives in Kuwait informed him during an inprocessing briefing that he would receive BAH while in Kuwait.  

14.  A memorandum, dated 8 May 2012, subject: [Applicant] Remission Packet (BAH and FSA), shows the Commander, Headquarters and Headquarters Company, 1st Information Operations Command (Land), Fort Belvoir, VA, informed the Defense Finance and Accounting Service (DFAS), Fort Belvoir, VA, he had reviewed the applicant's remission packet.  He indicated he supported the applicant's request for remission, stating disapproval of the remission packet would severely impact the applicant's financial situation, affecting the care for his children and his ability to pay child support.  He further stated the applicant acted according to guidance from the finance office personnel, who informed him his request for FSA would be disapproved if he was not authorized FSA.  

15.  On 8 May 2012, he signed a DA Form 3508 (Application for Remission or Cancellation of Indebtedness) showing he had total monthly net income of $6,035.76 and total monthly expenses of $5,431.90.  On 10 May 2012, his immediate commander signed the form indicating he had verified the applicant's financial data.

16.  On 10 May 2012, he submitted a memorandum, subject: Remission Packet Letter of Recommendation, to DFAS, Fort Belvoir, VA.  Paragraph 1 shows his immediate commander's initials recommending approval of his application for remission.  In the memorandum, the applicant states, in part:

The Kuwait Finance office approved BAH and FSA for the entire period of my Kuwait deployment….Kuwait Finance authorized BAH because previous Finance personnel incorrectly filed my change in marital status, unknown to me until now.  Kuwait Finance personnel were not sure of the FSA authorization.  They instructed me to submit the FSA request anyway and if not entitled, then Finance would not approve the request.  As a result, the Kuwait Finance office authorized FSA.

During my in-processing at the Finance office at [Fort] Belvoir, VA, Finance personnel reviewed and discontinued many of the allowances and entitlements due because of the Kuwait deployment.  Not only did finance discontinue the FSA but they requested the return of all FSA and BAH funding because I was not entitled to receive FSA and BAH during that time.  Due to my deployment, my ex-wife took care of our kids while I was deployed.  In gratitude and to compensate for the additional burden on her, I transferred those funds to her for any additional expenses she may incur.  I used the BAH to keep my mortgage in good standing.

17.  In a memorandum to DFAS, Fort Belvoir, VA, dated 10 May 2012, subject: [Applicant] Remission Packet (BAH and FSA), his commander confirmed he had reviewed the applicant's remission packet and stated disapproval of the request for remission would severely impact the applicant's financial situation.  His commander stated the applicant took the steps necessary to inform Finance of his change in marital status and followed the guidance of Finance personnel.  His commander stated the applicant "should not be penalized for something he was directed and approved."

18.  On 17 July 2012, the Chief, Operations Management Division, U.S. Army Human Resources Command (HRC), Fort Knox, KY, informed the Director, DMPO, NCR, Fort Belvoir, VA, that the applicant's application for remission or cancellation of indebtedness had been reviewed in accordance with Army Regulation 600-4 (Remission or Cancellation of Indebtedness).  Based on the review, his application was partially approved for $14,277.40.  The review determined no grounds existed to remit or cancel the debt based on hardship or injustice.

19.  The official website of the Defense Travel Management Office defines BAH as a U.S. based allowance prescribed by geographic duty location, pay grade, and dependency status.  It provides uniformed Service members equitable housing compensation based on housing costs in local civilian housing markets within the United States when government quarters are not provided.  A uniformed service member stationed outside the U.S., including U.S. territories and possessions, not furnished government housing, is eligible for Overseas Housing Allowance.  

20.  There are several types of BAH.  These include BAH with/without dependents and BAH-DIFF.  

	a.  BAH with/without dependents is paid to a member with permanent duty within the 50 United States, who is not furnished government housing and is eligible for BAH, based on the member's dependency status at the permanent duty zip Code.

	b.  BAH-DIFF is the housing allowance amount for a member who is assigned to single-type quarters and who is authorized a basic allowance for housing solely by reason of the member's payment of child support.  A member is not entitled to BAH-DIFF if the monthly rate of that child support is less than the BAH-DIFF.
21.  The Joint Federal Travel Regulation, Volume 1 (Uniformed Service Members), Chapter 10 (Housing Allowances), provides guidance on dependency determinations as they relate to BAH.  It states, in part, when a member is divorced from a non-member, and they share joint legal custody of a child, and the ex-spouse is awarded primary physical custody, then the member is a non-custodial parent for housing allowance purposes.

22.  The Department of Defense Financial Management Regulation, Volume 7A, Chapter 27, provides the criteria for receipt of FSA.  It states FSA is payable only to members with dependents.  Paragraph 270102A defines a dependent child or children as an unmarried child(ren) of the member who is in legal custody of the member.  Legal custody includes a circumstance in which the member has been awarded joint physical and legal custody of a dependent child(ren) as a result of a court ordered custody agreement or finalized divorce decree, which provides that the child(ren) physically reside with the member on an equal basis (no less than 14 days during a month) as compared to the time the child(ren) reside(s) with the spouse, and the member’s actual physical custody of the child(ren) is precluded due to an enforced family separation.  Such a custody arrangement must be stipulated in the signed court order or divorce decree, subject to the verification by the Secretary of the Military Department concerned.

23.  Army Regulation 600-4 gives 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 Army may remit or cancel a Soldier's debt arising from payments made in error, payments made in excess of an allowance on behalf of a Soldier, or debts incurred while serving on active duty.  To determine injustice the application must contain evidence that the applicant did not know and could not have known of the error and/or the applicant inquired of a proper authority and was told the payment was correct.  To determine injustice or hardship HRC must consider the Soldier's awareness of policy and procedures, military occupational specialty, rank, years of service, and prior experience.  

24.  Army Regulation 600-4 also states that Soldiers must make sure their financial accounts are correct.  They must review their monthly leave and earnings statements and report errors or discrepancies to the command and finance office/DMPO.

DISCUSSION AND CONCLUSIONS:

1.  The evidence of record does not support the applicant's request for full remission or cancellation of a debt in the amount of $28,554.80.

2.  The available records show the applicant received erroneous payments of FSA, COLA, HDP, and BAH.  He no longer contests the erroneous payments of COLA and HDP; however, he believes he should be relieved of the debt he incurred for erroneous payments of BAH and FSA.  

3.  The available records clearly show he and his former spouse, D------, agreed to joint custody of their children and agreed the children's primary residence would be with D------.  Based on this agreement, it is reasonable to presume his children did not physically reside with him at least 14 days a month.  Therefore, he was not entitled to receive FSA, and a debt was properly established to recoup the erroneous payments.  

4.  Because his ex-spouse has primary physical custody of their children, he is considered a non-custodial parent for the purpose of BAH.  Accordingly, while he was deployed to Kuwait, he was not entitled to full BAH.  When it was discovered that he had been erroneously paid full BAH, a debt was properly established to recoup these erroneous payments.  

5.  He bears at least a portion of the responsibility for the erroneous payments.  Information on FSA and BAH eligibility is readily available, and it is reasonable to expect an officer of his grade and length of service would be able to obtain this information, comprehend it, and take appropriate action to prevent payment of unauthorized entitlements.  Common sense would dictate that since he was deployed he could not have joint custody of his children.  A prudent person would have raised the issue with the supervisors of those Finance officials.

6.  HRC has reduced his debt to $14,227.40.  The available records do not show the basis for HRC's decision; however, HRC's decision was appropriate considering that it appears a Finance office in Kuwait bears equal blame for the erroneous payments he received.  

7.  In the absence of evidence showing error or injustice in HRC's determination, there is no basis for granting the relief he requests.

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)                                         AR20120014144





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ABCMR Record of Proceedings (cont)                                         AR20120014144



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