Citation Nr: 21013590 Decision Date: 03/09/21 Archive Date: 03/09/21 DOCKET NO. 15-30 453 DATE: March 9, 2021 ORDER The discontinuation/termination of Department of Veterans Affairs (VA) pension benefits for incarceration from July 26, 2010 to September 11, 2012, and from June 19, 2014 to October 12, 2018, as of the respective 61st day of incarceration, was proper; the appeal is denied. The overpayments of VA pension benefits in the amounts of $7,487.33 and $1,475.60, totaling $8,962.93, are valid debts; the appeal is denied. FINDINGS OF FACT 1. The Veteran was incarcerated on July 26, 2010; the 61st day of incarceration was September 24, 2010; he was released on September 11, 2012. 2. The VA Agency of Original Jurisdiction (AOJ) terminated benefits from the 61st day of incarceration until February 2012 because the AOJ initially received information that the Veteran was released from incarceration in February 2012, but then it was determined that he was released later on September 11, 2012. 3. The Veteran was paid benefits from February 1, 2012 through September 10, 2012 while he was still incarcerated so the AOJ retroactively terminated the pension which resulted in a $7,487.33 overpayment. 4. The Veteran was incarcerated on June 19, 2014; the 61st day of incarceration was August 19, 2014; he was released on October 12, 2018. 5. The Veteran had been paid pension benefits from August 19, 2014 through September 30, 2014 while he was incarcerated so the AOJ retroactively terminated the pension which resulted in a $1,475.60 overpayment. 6. The two overpayments together total $8,962.93; they are both validly created debts. CONCLUSIONS OF LAW 1. The AOJ properly terminated all VA pension benefits for incarcerations from July 26, 2010 to September 11, 2012, and from June 19, 2014 to October 12, 2018, as of the respective 61st days of incarceration. 38 U.S.C. § 5313; 38 C.F.R. § 3.666. 2. The overpayment of VA pension benefits in the amounts of $7,487.33 and $1,475.60 (totaling $8,962.93) were properly created. 38 U.S.C. § 5313; 38 C.F.R. § 3.666. REASONS AND BASES FOR FINDINGS AND CONCLUSIONS This appeal was remanded by the Board of Veterans’ Appeals (Board) to the AOJ in January 2019 for additional development. The AOJ substantially complied with the Board remand directives and the case has been returned to the Board for appellate review. An overpayment is created when VA determines that a beneficiary or payee has received monetary benefits to which he or she is not entitled. See 38 U.S.C. § 5302; 38 C.F.R. § 1.962. An overpayment may arise from virtually any benefits program administered pursuant to VA law, including pension, compensation, dependency and indemnity compensation, educational assistance benefits and subsistence allowance, insurance benefits, burial and plot allowances, clothing allowance, and automobile or other conveyance and adaptive equipment allowances. 38 C.F.R. § 1.956 (a). VA generally is required to recover erroneous VA payments or overpayments of benefits. See Edwards v. Peake, 22 Vet. App. 57, 59 (2008); 38 U.S.C. § 5314 (a) (generally requiring VA to deduct from future benefit payments a debt arising from a person’s participation in a VA benefits program); 38 C.F.R. § 1.912a (a)(same); 38 U.S.C. § 5316 (authorizing VA to recover a benefit(s) related debt by bringing a suit if the person fails to appropriately respond to reasonable administrative efforts to collect the debt). That is to say, whenever the Secretary finds that an overpayment has been made to a veteran or eligible person, the amount of such overpayment shall constitute a liability of such veteran or eligible person to the United States. 38 U.S.C. § 3685; Mountford v. Shinseki, 24 Vet. App. 443, 450, n.6 (2011). A beneficiary is charged with knowing the rules governing compensation or pension. Dent v. McDonald, 27 Vet. App. 362, 382 (2015) (summarizing Jordan v. Brown, 10 Vet. App. 171, 174-75 (1997)). Pension is not payable to (or for) a veteran who has been imprisoned in a Federal, State, or local penal institution as a result of conviction of a felony or misdemeanor for any part of the period beginning 61 days after such individual’s imprisonment begins and ending when such individual’s imprisonment ends. 38 U.S.C. § 1505; 38 C.F.R. § 3.666; see also Latham v. Brown, 4 Vet. App. 265 (1993). Pension will be resumed as of the day of release if notice is received within one year following release; otherwise, resumption with be effective the date of receipt of such notice. 38 C.F.R. § 3.666 (c). The Veteran was awarded nonservice-connected pension, effective February 1, 2003. He was issued a VA Form 21-8768. The VA Form 21-8768 states, in pertinent part, that VA will discontinue pension benefits payable to a person who is incarcerated in a Federal, State or local penal institution in excess of 60 days as a result of a felony or misdemeanor conviction. This form also stated that the law provides severe penalties which include fine or imprisonment or both for the fraudulent acceptance of any payment to which the recipient is not entitled. This form is consistent with 38 C.F.R. § 3.666, which provides that if any individual to or for whom pension is being paid under a public or private law administered by VA 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. The payee will be informed of his or her rights and the rights of dependents to payments while he or she is imprisoned as well as the conditions under which payments to him or to her may be resumed on his or her release from imprisonment. Pension will be resumed as of the day of release if notice (which constitutes an informal claim) is received within 1 year following release; otherwise resumption will be effective the date of receipt of such notice. See also 38 U.S.C. § 1505. In September 2008, a warrant was issued for the Veteran’s arrest and he was deemed a fugitive felon. In a September 2009 letter, the Veteran was advised that his pension benefits were terminated from that date. This action resulted in an overpayment totaling $12,518.87. Thereafter, a penal institution indicated that the Veteran was incarcerated from January 23, 2009 through May 15, 2009. This period of incarceration is not at issue. Subsequently, a VA and Social Security Administration (SSA) prison match revealed that the Veteran was again imprisoned as of July 2010. In a July 2013 letter, the AOJ informed the Veteran that the AOJ had reinstated the Veteran’s pension benefits effective February 1, 2012, because VA had information that the Veteran had been released from prison. In a February 2014 letter, the AOJ indicated that information had been received from the Los Angeles County Jail which showed that the Veteran had been imprisoned for more than 60 days following conviction of a felony or misdemeanor. The letter stated that VA law (38 U.S.C. § 1505) requires termination of pension payments effective the 61st day of imprisonment. Thus, the AOJ proposed to stop pension benefit payments effective September 24, 2010, the 61st day of the Veteran’s imprisonment. It was noted that a computer match between VA and local and state prisons showed that the Veteran was incarcerated on July 28, 2010. The Board notes that the document actually indicate the date was July 26, 2010. A September 2014 Report of Incarceration from Chino State Prison revealed that the Veteran was still incarcerated September 8, 2010 and was actually released on September 11, 2012, not on the earlier date of February 1, 2012. Another September 2014 Report of Incarceration from North County Correctional Facility, revealed that the Veteran was incarcerated again on June 19, 2014. In a September 2014 letter, the AOJ stated that the law requires VA to stop pension benefits when a recipient is imprisoned for more than 60 days following conviction of a felony or misdemeanor. Although the Veteran was previously told that the AOJ proposed to stop benefits from September 24, 2010 through the present date, his pension benefits were already terminated in 2010. Therefore, the AOJ had stopped pension benefits effective February 1, 2012, the date they had previously been reinstated the benefits because the pertinent prison information showed that he was still incarcerated at that time. His pension was reinstated effective September 11, 2012, when he was actually released after having been incarcerated since 2010. However, as noted, the Veteran was then imprisoned again on June 19, 2014. Thus, the AOJ informed him that the AOJ again stopped pension payments again beginning effective August 19, 2014, the 61st day of this imprisonment. He was told that this adjustment resulted in an overpayment of benefits which had been paid to him. He was then notified that both of the adjustments resulted in a cumulative overpayment of $8,962.93. A paid and due audit was performed which showed how the overpayment was calculated. The Veteran received benefits totaling $7,487.33 from February 1, 2012 through September 10, 2012; he also received benefits totaling $1,475.60 from August 19, 2014 through September 30, 2014. The amount of the two overpayments totaled $8,962.93. The Veteran maintains that he is entitled to a 10 percent portion of his benefits. Thereafter, information was received indicating that the Veteran had committed the illegal offense on June 10, 2014, but was initially confined on October 6, 2014. In April 2019, the AOJ attempted to obtain additional information. However, the penal institution was unable to verify any information regarding the Veteran because prisoner data is “scrubbed 30 days after release.” However, thereafter, an April 2019 letter from the Veteran’s parole unit confirmed that the Veteran was arrested and taken into custody on June 19, 2014. Further attached documentation showed that the Veteran was transferred from facilities on October 6, 2014. He was released on October 12, 2018. The AOJ reinstated pension benefits upon the Veteran’s release. In sum, the Veteran was incarcerated in July 2010. The 61st date was September 24, 2010. It was originally believed that the Veteran was released in February 2012. However, it was then determined that he was released on September 11, 2012. Thus, the Veteran was paid benefits from February 1, 2012 through September 10, 2012 while he was still incarcerated and not entitled to such benefits. He was overpaid $7,487.33 from February 1, 2012 through September 10, 2012. The Veteran was then incarcerated on June 19, 2014. Although it is contended that he was not incarcerated until October 2014, the relevant information from both the prison and the parole office indicated that the incarceration date was June 19, 2014; the Veteran was transferred between facilities in October 2014. The 61st date of incarceration was August 19, 2014. The Veteran had been already been paid from August 19, 2014 through September 30, 2014. The monies from this time period represent an overpayment of $1,475.60. As previously noted, these two amounted totaled $8,962.93. The termination of the benefits for these two time periods was proper because the Veteran was not entitled to payment while he was incarcerated. Although the Veteran believes he is entitled to at least 10 percent of his pension award, VA only provides reduced payments when a claimant is receiving compensation or dependency and indemnity compensation (DIC) per 38 C.F.R. § 3.665. The Veteran’s pension is governed by 38 C.F.R. § 3.666 which provides for a complete termination of benefits for the time periods in question while incarcerated.   As such, the termination of benefits was proper and the creation of both debts was proper. The Board notes that the Veteran has sought relief from the purported loss or non-payment of a retroactive payment of benefits to the Veteran, but that matter is not certified to the Board of Veterans’ Appeals on appeal. S. L. Kennedy Veterans Law Judge Board of Veterans’ Appeals Attorney for the Board J. Connolly, Counsel The Board’s decision in this case is binding only with respect to the instant matter decided. This decision is not precedential and does not establish VA policies or interpretations of general applicability. 38 C.F.R. § 20.1303.