Citation Nr: 0326895 Decision Date: 10/08/03 Archive Date: 10/20/03 DOCKET NO. 01-08 381A ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in Denver, Colorado THE ISSUE Entitlement to a waiver of the recovery of an overpayment of Department of Veterans Affairs (VA) improved pension benefits in the amount of $14,508, including whether the overpayment was properly created. REPRESENTATION Appellant represented by: Disabled American Veterans WITNESS AT HEARING ON APPEAL Veteran ATTORNEY FOR THE BOARD J. Connolly Jevtich, Counsel INTRODUCTION The veteran had active service from September 1971 to October 1974. This matter came before the Board of Veterans' Appeals (Board) on appeal from an August 2000 decision of the Regional Office (RO) in Denver, Colorado and a November 20001 decision of the Committee on Waivers and Compromises (Committee) of that RO. In April 2003, the veteran testified via video conference from the RO before the undersigned, sitting in Washington, D.C. FINDINGS OF FACT 1. The veteran's relatives submitted a false eligibility verification report (EVR) in February 1997, purporting to show the veteran's current level of income. 2. The RO awarded improved pension benefits at a rate in accordance with the income information provided on the February 1997 EVR. 3. In August 1997, June 1998, and September 1998, the veteran provided notice to the RO that he was not receiving the checks that the VA had issued. 4. The RO paid the veteran's improved pension benefits directly to one of the veteran's relatives without authorization from the veteran or without a finding that the veteran was incompetent to manage his VA pension benefits. CONCLUSION OF LAW An overpayment of improved pension benefits in the amount of $14,508 was not properly created. 38 U.S.C.A. § 5112 (West 2002); 38 C.F.R. §§ 3.500, 3.501 (2002). REASONS AND BASES FOR FINDINGS AND CONCLUSION As an initial matter, the Board notes that the expanded duties to notify and assist enacted by the Veterans Claims Assistance Act of 2000, 38 U.S.C.A. §§ 5103, 510A, and 5107 do not apply to the veteran's claim for waiver of overpayment. See Barger v. Principi, 16 Vet. App. 132, 138 (2002). Moreover, the veteran's claim is being granted, as set forth below. In light of the Board's determination in this case, further development is clearly not warranted. In a June 1996 decision, the RO granted entitlement to nonservice-connected pension benefits. The basis for this grant was a finding that the veteran was permanently and totally disabled due to paranoid schizophrenia. In a July 1996 letter, the veteran was notified of this decision and that he had been awarded improved pension benefits He was informed that his responsibilities as a pension recipient included notifying VA of any changes in his net worth. This notification letter was sent to the veteran's address of record. The RO remailed this letter to the veteran because he has moved in with relatives. At this time, the RO made no determination that the veteran was incompetent to handle VA benefits. Thereafter, in February 1997, an EVR was received in which the veteran's income was reported. Based on this information, the veteran's improved pension benefits were adjusted. He was informed of this information in a February 1997 letter and he was provided a VA Form 21- 8768, which notified him that he was obligated to provide prompt notice of any change in income or net worth or dependency status and that a failure to provide such would result in the creation of an overpayment which would be subject to recovery. In August 1997, the veteran notified VA that he had not received any pension payments. In June 1998 and September 1998, the veteran notified VA that he had not received any pension benefits. According to a February 1999 VA Form 119, Report of Contact, the veteran came to the RO and submitted a letter requesting copies of the checks that he allegedly did not receive. He stated that he did not receive those checks and that the District Attorney was requesting copies of those checks. The veteran contacted VA two more times during 1999 regarding the allegedly missing checks. In the meantime, an overpayment was created in the veteran's pension account in the amount of $14,508. The reason for the overpayment was that the information provided on the February 1997 EVR was incorrect. The RO retroactively reduced the veteran's improved pension award effective February 1997. The veteran has asserted that he did not provide this EVR. He also requested a waiver of the debt on that basis. However, the Committee denied his waiver request and he appealed. The veteran maintains that VA's correspondence was sent to a relative's post office box. Likewise, this relative set up a direct deposit with VA for the veteran's pension payments. The bank account was her own. The United States Secret Service conducted an investigation regarding the veteran's pension checks. When the veteran was interviewed, he indicated that he informed VA that he was not receiving his pension payments when he first was informed that he had been awarded pension benefits by a physician. Prior to that time, he indicated that he did not know he was getting paid by VA. It was noted that the veteran appeared delusional, eccentric, and bizarre. The Secret Service contacted the two financial institutions where the checks were deposited. The checks were deposited into accounts of a relative of the veteran. The Secret Service also interviewed the veteran's relatives. One relative admitted to forging the veteran's signatures on some of the checks, but not all. The other relative indicated that he did not believe that he had forged the veteran's name, but that since the veteran was living with them, he and the other relative would keep some of the money for room and board. He alleged that the veteran knew that the checks were being deposited into the other relative's account, but had requested that this be done so that he could avoid paying child support. In addition, he stated that due to mental illness, the veteran may not have been aware that he had received his money. Handwriting samples from the veteran and the two relatives were inconclusive. The Secret Service declined to prosecute in their case because of family involvement. In April 2003, the veteran testified in Washington, D.C., before the undersigned. The veteran's representative indicated that the veteran filed for VA pension benefits while temporarily living with his relatives. However, subsequent to a hospitalization which left him in a domicile, he did not return to live with them. It was indicated that the veteran did not sign the February 1997 EVR. In addition, the veteran did not receive any VA notification letters and did not know that he was getting pension benefits until he was told that he was getting these benefits while he was hospitalized. As soon as he knew that he was not in receipt of his benefits, he notified VA, but they did not take the appropriate action for three years. In addition, the representative pointed out that after the original check was negotiated, the method of payment was changed to direct deposit into a bank where the veteran did not have an account nor was he a signatory on an account. The representative indicated that VA did not deem the veteran incompetent and he had not been given a fiduciary or guardian to handle his benefits. In sum, the veteran was granted entitlement to nonservice- connected pension benefits. The rate of his pension benefits was based on the February 1997 EVR. This EVR was incorrect and, because of the inaccuracies, the rate of pension was awarded at a rate higher than the veteran was entitled to receive. The veteran notified VA that there was a problem in August 1997. Nevertheless, action was not taken at that time to reduce the pension payments. The record is persuasive in showing that the veteran did not sign the February 1997 EVR. Therefore, he did not provide VA with the erroneous financial information upon which his rate of pension was based. Thereafter, although the RO attempted to notify the veteran of the award, his rate of pension, and his obligations as a pension recipient, it appears that the veteran may not have received these notification letters because his relatives received the letters (though this is not clear). The record reflects that the veteran is permanently and totally disabled from paranoid schizophrenia. However, no action was ever taken by the VA in 1996 regarding the critical issue of competency. He was not found incompetent by VA pursuant to 38 C.F.R. § 3.353 and he has did not have a formal fiduciary or guardian to handle his benefits. Notwithstanding, it appears that the VA sent his checks to an account not under his direct control. The Secret Service verified that nine checks were directly deposited into an account that did not belong to the veteran. A relative of the veteran admitted to forging the veteran's signature on at least some of his pension checks. Both relatives essentially admitted to receiving the monies from VA. Fraud is defined by VA regulation as an act committed when a person knowingly makes or causes to be made or conspires, combines, aids, or assists in, agrees to, arranges for, or in any way procures the making or presentation of a false or fraudulent affidavit, declaration, certificate, statement, voucher, or paper, concerning any claim for benefits under any of the laws administered by the VA (except laws relating to insurance benefits). Any person who commits fraud forfeits all rights to benefits under all laws administered by the VA other than laws relating to insurance benefits. 38 C.F.R. § 3.901. The record establishes that the relatives of the veteran may have perpetrated fraud on VA by submitting a false EVR, by participating in having VA checks directly deposited in an account that did not belong to the veteran without authority, and by forging the veteran's checks. However, they have no rights to be forfeited and any action upon them is not within the Board's jurisdiction. Although the fraudulent actions of the veteran's relatives contributed to cause the debt to be created, VA is not without responsibility with regard to the creation of the debt. It is solely within the rating agencies authority to make a determination regarding competency under 38 C.F.R. § 3.353(b). Since the RO made no competency rating, the RO relied on the information as believed to have been provided by the veteran, in the February 1997 EVR. However, when the veteran notified the RO in August 1997 that the EVR was not completed by him, the RO failed to take the appropriate action. Not only did the RO fail to take the appropriate action, a direct deposit was established with the veteran's relative without his authorization. When the RO made payments to a relative of the veteran, the RO was not authorized by the veteran to do so. These actions contributed to cause to the creation of the debt. The debt in this case was created apparently by the fraudulent actions of relatives of the veteran and by inaction by VA. The Board cannot take action against the relatives of the veteran. Thus, the Board must consider whether the debt was caused otherwise solely by VA, the veteran, or both. Administrative error connotes that the veteran neither had knowledge of nor should have been aware of the erroneous award. Further, neither the veteran's actions nor the failure to act must have contributed to payment pursuant to the erroneous award. 38 U.S.C.A. § 5112; 38 C.F.R. § 3.500. In this case, the veteran notified the VA on many occasions that he was not receiving his VA benefits. The Board finds that the debt of $14,508 was created due to administrative error with no error on the part of the veteran. The veteran did not have knowledge of nor should have been aware of the erroneous award due to the circumstances in this case. He was permanently and totally disabled due to mental impairment and may have been deceived by others. VA was aware of his totally disabling mental impairment. Neither his actions nor his failure to act contributed to payment pursuant to the erroneous award. He did not submit the false EVR and he notified VA that he was not receiving his pension benefits in a timely manner. VA appears to have paid someone else the pension benefits. The Board concludes that overpayment was attributable to VA error, and was improperly charged to the veteran. Accordingly, since the overpayment debt was not validly created, the question of whether waiver may be granted is moot. 38 U.S.C.A. § 5302(c); 38 C.F.R. §§ 1.963(a), 1.965(b). ORDER The debt not being validly created, the veteran's appeal is granted. ____________________________________________ JOHN J. CROWLEY ACTING Veterans Law Judge, Board of Veterans' Appeals Department of Veterans Affairs YOUR RIGHTS TO APPEAL OUR DECISION The attached decision by the Board of Veterans' Appeals (BVA or Board) is the final decision for all issues addressed in the "Order" section of the decision. The Board may also choose to remand an issue or issues to the local VA office for additional development. If the Board did this in your case, then a "Remand" section follows the "Order." However, you cannot appeal an issue remanded to the local VA office because a remand is not a final decision. The advice below on how to appeal a claim applies only to issues that were allowed, denied, or dismissed in the "Order." If you are satisfied with the outcome of your appeal, you do not need to do anything. We will return your file to your local VA office to implement the BVA's decision. However, if you are not satisfied with the Board's decision on any or all of the issues allowed, denied, or dismissed, you have the following options, which are listed in no particular order of importance: ? Appeal to the United States Court of Appeals for Veterans Claims (Court) ? File with the Board a motion for reconsideration of this decision ? File with the Board a motion to vacate this decision ? File with the Board a motion for revision of this decision based on clear and unmistakable error. Although it would not affect this BVA decision, you may choose to also: ? Reopen your claim at the local VA office by submitting new and material evidence. There is no time limit for filing a motion for reconsideration, a motion to vacate, or a motion for revision based on clear and unmistakable error with the Board, or a claim to reopen at the local VA office. None of these things is mutually exclusive - you can do all five things at the same time if you wish. However, if you file a Notice of Appeal with the Court and a motion with the Board at the same time, this may delay your case because of jurisdictional conflicts. If you file a Notice of Appeal with the Court before you file a motion with the BVA, the BVA will not be able to consider your motion without the Court's permission. How long do I have to start my appeal to the Court? You have 120 days from the date this decision was mailed to you (as shown on the first page of this decision) to file a Notice of Appeal with the United States Court of Appeals for Veterans Claims. If you also want to file a motion for reconsideration or a motion to vacate, you will still have time to appeal to the Court. As long as you file your motion(s) with the Board within 120 days of the date this decision was mailed to you, you will then have another 120 days from the date the BVA decides the motion for reconsideration or the motion to vacate to appeal to the Court. You should know that even if you have a representative, as discussed below, it is your responsibility to make sure that your appeal to Court is filed on time. How do I appeal to the United States Court of Appeals for Veterans Claims? Send your Notice of Appeal to the Court at: Clerk, U.S. Court of Appeals for Veterans Claims 625 Indiana Avenue, NW, Suite 900 Washington, DC 20004-2950 You can get information about the Notice of Appeal, the procedure for filing a Notice of Appeal, the filing fee (or a motion to waive the filing fee if payment would cause financial hardship), and other matters covered by the Court's rules directly from the Court. You can also get this information from the Court's web site on the Internet at www.vetapp.uscourts.gov, and you can download forms directly from that website. The Court's facsimile number is (202) 501-5848. To ensure full protection of your right of appeal to the Court, you must file your Notice of Appeal with the Court, not with the Board, or any other VA office. How do I file a motion for reconsideration? You can file a motion asking the BVA to reconsider any part of this decision by writing a letter to the BVA stating why you believe that the BVA committed an obvious error of fact or law in this decision, or stating that new and material military service records have been discovered that apply to your appeal. If the BVA has decided more than one issue, be sure to tell us which issue(s) you want reconsidered. Send your letter to: Director, Management and Administration (014) Board of Veterans' Appeals 810 Vermont Avenue, NW Washington, DC 20420 VA FORM JUN 2003 (RS) 4597 Page 1 CONTINUED Remember, the Board places no time limit on filing a motion for reconsideration, and you can do this at any time. However, if you also plan to appeal this decision to the Court, you must file your motion within 120 days from the date of this decision. How do I file a motion to vacate? You can file a motion asking the BVA to vacate any part of this decision by writing a letter to the BVA stating why you believe you were denied due process of law during your appeal. For example, you were denied your right to representation through action or inaction by VA personnel, you were not provided a Statement of the Case or Supplemental Statement of the Case, or you did not get a personal hearing that you requested. You can also file a motion to vacate any part of this decision on the basis that the Board allowed benefits based on false or fraudulent evidence. Send this motion to the address above for the Director, Management and Administration, at the Board. Remember, the Board places no time limit on filing a motion to vacate, and you can do this at any time. However, if you also plan to appeal this decision to the Court, you must file your motion within 120 days from the date of this decision. How do I file a motion to revise the Board's decision on the basis of clear and unmistakable error? You can file a motion asking that the Board revise this decision if you believe that the decision is based on "clear and unmistakable error" (CUE). Send this motion to the address above for the Director, Management and Administration, at the Board. You should be careful when preparing such a motion because it must meet specific requirements, and the Board will not review a final decision on this basis more than once. You should carefully review the Board's Rules of Practice on CUE, 38 C.F.R. 20.1400 -- 20.1411, and seek help from a qualified representative before filing such a motion. See discussion on representation below. Remember, the Board places no time limit on filing a CUE review motion, and you can do this at any time. How do I reopen my claim? You can ask your local VA office to reopen your claim by simply sending them a statement indicating that you want to reopen your claim. However, to be successful in reopening your claim, you must submit new and material evidence to that office. See 38 C.F.R. 3.156(a). Can someone represent me in my appeal? Yes. You can always represent yourself in any claim before VA, including the BVA, but you can also appoint someone to represent you. An accredited representative of a recognized service organization may represent you free of charge. VA approves these organizations to help veterans, service members, and dependents prepare their claims and present them to VA. An accredited representative works for the service organization and knows how to prepare and present claims. You can find a listing of these organizations on the Internet at: www.va.gov/vso. You can also choose to be represented by a private attorney or by an "agent." (An agent is a person who is not a lawyer, but is specially accredited by VA.) If you want someone to represent you before the Court, rather than before VA, then you can get information on how to do so by writing directly to the Court. Upon request, the Court will provide you with a state-by-state listing of persons admitted to practice before the Court who have indicated their availability to represent appellants. This information is also provided on the Court's website at www.vetapp.uscourts.gov. Do I have to pay an attorney or agent to represent me? Except for a claim involving a home or small business VA loan under Chapter 37 of title 38, United States Code, attorneys or agents cannot charge you a fee or accept payment for services they provide before the date BVA makes a final decision on your appeal. If you hire an attorney or accredited agent within 1 year of a final BVA decision, then the attorney or agent is allowed to charge you a fee for representing you before VA in most situations. An attorney can also charge you for representing you before the Court. VA cannot pay fees of attorneys or agents. Fee for VA home and small business loan cases: An attorney or agent may charge you a reasonable fee for services involving a VA home loan or small business loan. For more information, read section 5904, title 38, United States Code. In all cases, a copy of any fee agreement between you and an attorney or accredited agent must be sent to: Office of the Senior Deputy Vice Chairman (012) Board of Veterans' Appeals 810 Vermont Avenue, NW Washington, DC 20420 The Board may decide, on its own, to review a fee agreement for reasonableness, or you or your attorney or agent can file a motion asking the Board to do so. Send such a motion to the address above for the Office of the Senior Deputy Vice Chairman at the Board. VA FORM JUN 2003 (RS) 4597 Page 2