Citation Nr: 21026949 Decision Date: 05/04/21 Archive Date: 05/04/21 DOCKET NO. 14-02 701 DATE: May 4, 2021 REMANDED Whether the termination of Department of Veterans Affairs (VA) compensation benefits effective December 27, 2001 due to fugitive felon status was proper and, if so, whether the debt was properly calculated, is remanded. Entitlement to a waiver of recovery of an overpayment of VA compensation benefits in the calculated amount of $55,503.27 is remanded. REASONS FOR REMAND The Veteran served on active duty in the United States Army from October 1986 to August 1988. This matter comes to the Board of Veterans' Appeals (Board) on appeal from an October 2012 determination of the VA Debt Collection Center (DMC) to collect a $55,503.27 debt, and the January 2013 decision of the VA Committee on Waivers and Compromises to deny a waiver of that debt. The Veteran provided hearing testimony before the undersigned in March 2017, after which the Board remanded these issues in March 2018. A review of the record reveals the Agency of Original Jurisdiction (AOJ) did not substantially comply with the remand directives. Such noncompliance is error on the part of the originating agency. Moreover, the Board errs as a matter of law when it fails to ensure compliance. Stegall v. West, 11 Vet. App. 268 (1998). Accordingly, the Board must once again remand these matters for completion of the prior remand directives. In particular, the Board required a thorough explanation of the how the totals of the Veteran's compensation benefits payments from December 27, 2001 to December 6, 2010 were calculated, and required a full accounting to be provided. The AOJ was asked to specifically address the benefit payment reduction during the Veteran's two periods of incarceration, the resulting overpayment, and any subsequent payments, and to make clear how this has been accounted for in the current overpayment total. The Board also required an accounting of the reduction of the benefits payments since January 2013 to satisfy the debt. Additionally, the prior remand required the AOJ to contact OIG and request any documentation concerning the Veteran's reported interaction with that office with respect to the determination of the Veteran's status as a fugitive felon following a January 1997 warrant. The Veteran's main argument related to the validity of this debt is that the warrant at issue was for a misdemeanor, not a felony. Following the remand, the AOJ contacted the Defense Finance and Accounting Service (DFAS) in June 2020 and again in August 2020 and requested an audit as to how the compensation benefits from December 27, 2001 to December 6, 2010 were calculated. In August 2020, DFAS responded indicating the request could not be processed due to privacy considerations. There is no indication in the record that any follow up occurred, or if any follow up was needed. In other words, it is unclear whether the AOJ determined that information from DFAS is needed and, if so, it is unclear why the AOJ did not pursue the authorizations needed to obtain this information. On remand, the AOJ should undergo the development necessary, or, in the alternative, provide an explanation of why it was determined the information was not needed to assess the creation of the debt at issue. In September 2020, the AOJ requested information from an internal VA source as to how the $55,503.27 debt was created, as well as how a separate $7,904.54 debt was created and whether it was applied to the current debt balance. A copy of an October 2020 email communication from a VA Supervisory Financial Administration Specialist includes an explanation indicating there was some error in the calculation of the award. This explanation indicates an initial overpayment in the amount of $7,904.54 was created related to the period of January 5, 2005 to June 26, 2005, and May 17, 2006 to May 30, 2007. The explanation goes on to indicate and overpayment in the amount of $55,503.27 was created October 4, 2012, "which should have been in the amount of $62,800.80 if the award had been done correctly...the award 5-5-07 was incorrect due to priors. The overpayment created in the amount of $55,503.27 created for the period beginning 1/1/05 was incorrect as priors were not input on the award so the period 12-27-01/12-31-04 was not included in the o/p. The correct o/p should have been $62,800.80. As I stated at the bottom of the audit on tab 1, either amend award to create the additional overpayment or Admin Decision is needed or the audit will never balance." A numerical report running from September 1988 to September 2012 was attached. The RO then, in November 2020, issued a form letter and attached a copy of the numerical report. There was no explanation of the debt whatsoever. A supplemental statement of the case (SSOC) was then issued in December 2020, which also provided no explanation of the debt. This undoubtedly cannot be considered a thorough explanation of the debt at issue. Further, it appears more action was needed to determine the appropriate amount of the debt, which did not occur. As for the required communication with OIG, the record does include an August 2020 memo documenting the AOJ's conversation with the OIG, which shows the OIG confirmed that there are no records of any correspondence with the Veteran at any time and also that communication like this between Agents of OIG and Veterans do not typically occur. However, this memo also includes the following statement, "He had closed out the fugitive felon warrants and was subject to a misdemeanor." It is unclear what this statement means. Given that the Veteran's argument related to the validity of this debt is that he was not subject to a warrant for a felony at the time in question, but had a misdemeanor warrant, clarification of this statement is imperative to fairly deciding this appeal. Therefore, remand is again required. Finally, because a decision on the validity of the debt must occur prior to the matter of whether a waiver is warranted, the Veteran's waiver claim must be deferred pending adjudication of his challenge to the validity of the debt. Schaper v. Derwinski, 1 Vet. App. 430, 437 (1991) ("when a Veteran raises the validity of the debt as part of a waiver application... it is arbitrary and capricious and an abuse of discretion to adjudicate the waiver application without first deciding a veteran's challenge to the lawfulness of the debt asserted against him or her"). To the extent a decision on the validity of the debt issue could significantly impact a decision on the issue of whether a waiver is warranted, the issues are inextricably intertwined. A remand of the waiver issue is, therefore, also required. The matters are REMANDED for the following action: 1. Conduct any follow up development needed after the August 2020 response from DFAS. If no such development of records from DFAS has been deemed necessary, please explain the reasoning for this in the record. 2. Explain the statement, "He had closed out the fugitive felon warrants and was subject to a misdemeanor," which is found in the August 2020 Report of General Information following the OIG contact. The Board seeks clarification as to whether this is an indication that the Veteran's warrant for the time in question was for a misdemeanor, rather than a felony. 3. Thoroughly explain how the debt related to the Veteran's compensation benefits from December 27, 2001 to December 6, 2010 was calculated. The matter on appeal before the Board relates to this period during which the Veteran was deemed a fugitive felon. The October 2020 internal communication with the VA Supervisory Financial Administration Specialist implies the original amount stated as the debt was incorrectly calculated and there is an indication that additional development of the information is needed. With the explanation of the debt calculation for the period on appeal, the AOJ should comment upon the October 2020 communication and indicate if any amount due has changed and, if so, whether the Veteran was properly notified. The debt explanation should also include a discussion of the benefit payment reduction during the Veteran's two periods of incarceration, the resulting overpayment, and any subsequent payments, and to make clear how this has been accounted for in the current overpayment total. Again, the matter on appeal before the Board is the debt related to the period during which the Veteran was deemed a fugitive felon. 4. After completing the above actions, to include any other development as may be indicated by any response received as a consequence of the actions taken in the preceding paragraphs, the Veteran's claims should be readjudicated based on the entirety of the evidence. MICHAEL E. KILCOYNE Veterans Law Judge Board of Veterans' Appeals Attorney for the Board A. Adamson, 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.