Citation Nr: 1007461 Decision Date: 03/01/10 Archive Date: 03/11/10 DOCKET NO. 07-39 824 ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in Milwaukee, Wisconsin THE ISSUE Entitlement to a waiver of overpayment of nonservice- connected pension benefits in the stated amount of $5,440.00, to include the question of whether the overpayment was properly created. REPRESENTATION Appellant represented by: Veterans of Foreign Wars of the United States ATTORNEY FOR THE BOARD A. J. Turnipseed, Counsel INTRODUCTION The Veteran served on active duty from August 1957 to August 1961 and from November 1962 to April 1965. This matter comes before the Board of Veterans' Appeals (Board) from an April 2007 decision by the Committee on Waivers and Compromises at the Department of Veterans Affairs (VA) Regional Office (RO) above. The appeal is REMANDED to the RO via the Appeals Management Center (AMC), in Washington, DC. VA will notify the appellant if further action is required. REMAND In a rating action dated September 2005, the RO in Nashville, TN, granted entitlement to nonservice-connected pension benefits, effective from April 26, 2005, with payment beginning in May 2005. Under 38 C.F.R. § 3.666, if any individual to or for whom pension is being paid under a public or private law administered by the Department of Veterans Affairs is imprisoned in a Federal, State, or local penal institution as the result of conviction of a felony or misdemeanor, such pension payments will be discontinued effective on the 61st day of imprisonment following conviction. In October 2006, VA received information that the Veteran was incarcerated on April 18, 2006 for a felony offense. As such, the Pension Maintenance Center at the RO in Milwaukee, WI (hereinafter PMC), sent the Veteran a letter proposing to terminate his pension benefits, effective June 17, 2006. The Veteran was informed that the proposed termination would result in an overpayment of benefits but that he could avoid the termination by submitting evidence showing he was incarcerated for less than 60 days. The Veteran did not submit any such evidence and, in December 2006, VA sent the Veteran a letter informing him that his pension benefits were terminated, effective June 17, 2006, the 61st day of imprisonment. In January 2007, VA informed the Veteran that the change in his benefits resulted in him being paid $1,779.87 more than he was entitled to receive. In November 2006, VA received information that a warrant had been issued for the Veteran's arrest on May 22, 1997, for violation of parole, and the Veteran had been arrested on March 20, 2006. In this regard, pension is not payable on behalf of a veteran for any period during which he or she is a fugitive felon. A fugitive felon is defined as a person who is a fugitive by reason of (i) fleeing to avoid prosecution, or custody or confinement after conviction for an offense, or an attempt to commit an offense, which is a felony under the laws of the place from which the person flees; or (ii) violating a condition of probation or parole imposed for commission of a felony under Federal or State law. See 38 C.F.R. § 3.666(e)(1), (2). As such, the PMC sent the Veteran a letter informing him of the law regarding fugitive felons and that he could submit evidence showing the warrant had been cleared. The letter also informed the Veteran that termination of his pension benefits was proposed, effective May 1, 2005, if the requested evidence was not submitted within 60 days of the date of the letter, which would result in an overpayment of benefits. The Veteran did not submit the requested information and, in February 2007, the RO sent him a letter advising that his pension benefits had been terminated, effective May 1, 2005, the day the Veteran's pension payments began. Later in February 2007, VA sent the Veteran a letter informing him that he had pension indebtedness in the amount of $5,988. In March 2007, the Veteran submitted a statement to the PMC that was accepted as a request for waiver of the overpayment but, in April 2007, the PMC denied the Veteran's request for a waiver. The PMC informed the Veteran that his first debt of $1,779.87 was created in December 2006, for the period of June 17, 2006 through December 31, 2006, and that his second debt of $4,208.13 was created in February 2007, for the period of May 1, 2005 through June 17, 2006, which created a total debt of $5, 988.00. The Veteran submitted a notice of disagreement as to the waiver denial and the amount of the overpayment. In his notice of disagreement, the Veteran informed the PMC that he was arrested on March 20, 2006 and stated that he did not receive $5,988.00 from VA. Because the Veteran submitted evidence showing that the warrant was cleared on March 20, 2006, the day he was arrested, the PMC sent the Veteran a letter informing him that his pension benefits were restarted effective March 20, 2006 and would continue until the 61st day of incarceration, May 19, 2006. See May 2007 letter. The PMC later noted that the 61st day following March 20, 2006 was May 20, 2006. In December 2007, the Veteran perfected his appeal to the Board by submitting a VA Form 9. Subsequently, the PMC sent the Veteran statements of the case (SOC) that indicated his overpayment amount now totaled $5,440.00. Indeed, a November 2007 SOC reflects that an overpayment of $3,660.13 was created during the period of May 1, 2005 through March 19, 2006, due to his fugitive felon status, and that a second overpayment of $1,779.87 was created during the period of June 17, 2006 through December 31, 2006, due to him being incarcerated for a felony. Review of the record reveals that the time periods and payment amounts used to calculate the overpayment amounts may be incorrect, and, thus, an accounting or audit is needed to determine the correct amount of benefits that were overpaid the Veteran. Because the Veteran had an outstanding warrant at the time pension benefits were granted, he was not entitled to receive nonservice-connected pension benefits until the warrant was cleared. See 38 C.F.R. § 3.666(e). As such, the first overpayment was created for the time period of May 1, 2005, the date pension benefits were first awarded, through March 19, 2006, the day before he was arrested and the warrant cleared. The September 2005 rating decision reflects that the Veteran was entitled to receive $846 for May 2005 and $262 beginning in June 2005 due to a change in his income. In January 2006, the Veteran was entitled to receive $274, based on a cost-of- living increase. The report of payment history included in the record reveals the Veteran was sent a check for $1894 in October 2005, checks for $262 in November and December 2005, and checks for $274 in late December 2005 (for January 2006) and March 2006. The evidence shows the Veteran's February 2006 payment was used to pay a debt at the VA Medical Center in Nashville, TN. Given the overpayment amount reported by the PMC in the SOC, it does not appear that either the amounts the Veteran was entitled to receive or the amounts he actually received from May 1, 2005 to March 19, 2006, were used to calculate the overpayment amount. Because the Veteran was arrested and incarcerated for violation of parole, he was considered a convicted felon from the date of arrest on March 20, 2006. As such, the second overpayment was created for the time period of May 20, 2006, the 61st day following his arrest and "conviction," through December 31, 2006, the last day for which the Veteran received pension benefits. The evidentiary record does not contain a report of payment history which documents the payments the Veteran received from VA. Given the apparent discrepancy in the time periods and payment amounts used to calculate the Veteran's overpayment amount, the Board finds that a remand is necessary to obtain an accounting/audit of the time periods and payments issued to the Veteran that are the basis of the overpayment of pension benefits. Accordingly, the case is REMANDED for the following action: 1. Set forth a written paid and due audit of the Veteran's pension account for the period of May 1, 2005 to December 31, 2006. This audit should reflect, on a month-by-month basis, the amounts actually paid to the Veteran, as well as the amounts to which he was properly entitled. The audit should include the amount of overpayment, if any, that may have been repaid by the Veteran. The audit should also indicate if the payments were used to offset another unassociated debt and identify and pertinet months and amounts. A copy of the written audit must be associated with the claims file and a copy provided to the Veteran and his representative. 2. Thereafter, the issue on appeal should be readjudicated. If the benefit sought on appeal is not granted to the Veteran's satisfaction, the Veteran and his representative should be provided with a supplemental statement of the case and afforded the appropriate opportunity to respond thereto. The case should then be returned to the Board for further appellate consideration, if otherwise in order. The Board intimates no opinion as to the ultimate outcome of this case. The Veteran need take no action unless otherwise informed. The appellant has the right to submit additional evidence and argument on the matter the Board has remanded. Kutscherousky v. West, 12 Vet. App. 369 (1999). This claim must be afforded expeditious treatment. The law requires that all claims that are remanded by the Board of Veterans' Appeals or by the United States Court of Appeals for Veterans Claims for additional development or other appropriate action must be handled in an expeditious manner. See 38 U.S.C.A. §§ 5109B, 7112 (West Supp. 2009). _________________________________________________ JOHN J. CROWLEY Veterans Law Judge, Board of Veterans' Appeals Under 38 U.S.C.A. § 7252 (West 2002), only a decision of the Board of Veterans' Appeals is appealable to the United States Court of Appeals for Veterans Claims. This remand is in the nature of a preliminary order and does not constitute a decision of the Board on the merits of your appeal. 38 C.F.R. § 20.1100(b) (2009).