IN THE CASE OF: BOARD DATE: 19 December 2017 DOCKET NUMBER: AR20160002279 BOARD VOTE: _________ _______ ________ GRANT FULL RELIEF ________ ________ ________ GRANT PARTIAL RELIEF ________ ________ ________ GRANT FORMAL HEARING ___x____ ___x____ ___x____ DENY APPLICATION 2 Enclosures 1. Board Determination/Recommendation 2. Evidence and Consideration IN THE CASE OF: BOARD DATE: 19 December 2017 DOCKET NUMBER: AR20160002279 BOARD DETERMINATION/RECOMMENDATION: The evidence presented does not demonstrate the existence of a probable error or injustice. Therefore, the Board determined 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. IN THE CASE OF: BOARD DATE: 19 December 2017 DOCKET NUMBER: AR20160002279 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 cancellation of a debt resulting from the loss of military equipment and non-payment of Servicemembers' Group Life Insurance (SGLI) premiums. He also requests a personal hearing. 2. The applicant states, in effect, he incurred a debt to the Government in the amount of $515.20 consisting of $29 for non-payment of SGLI premiums and $486.20 for the loss/damage of military equipment. He argues he turned in the items that are not reflected on his records and he does not owe SGLI premiums because he was not at drill at the time. He has written to the Defense Finance and Accounting Service (DFAS) on multiple occasions in an effort to resolve this issue. It appears DFAS has referred the debt for collection and garnishment, and it affects his credit history. He now owes the total amount due plus interest and fees. 3. The applicant provides: * Letter of Indebtedness to the United States Government, dated 16 December 2014 * Hearing Request Administrative Wage Garnishment, dated 22 July 2015 * DFAS Summary Record and Hearing Decision, dated 21 September 2015 * Letter from the Department of Treasury, dated 31 December 2015 * DA Form 2062 (Hand Receipt/Annex Number) * DD Form 362 (Statement of Charges/Cash Collection Voucher) CONSIDERATION OF EVIDENCE: 1. The applicant enlisted in the Virginia Army National Guard (VAARNG) on 26 July 2002 and he held military occupational specialty 13D (Field Artillery Automated Data Specialist). 2. He attained the rank/grade of staff sergeant/E-6 and he was honorably discharged from the VAARNG on 25 July 2014. He completed 12 years of total service for retired pay. 3. Following his discharge, DFAS established a debt against him in the amount of $515.20, consisting of $29 for SGLI premiums (since he was not attending drills, these premiums were made on his behalf by the Government; the debt is based on his date of discharge from the VAARNG (25 July 2014) and the amount of $486.20, which is a recoupment due to the loss or damage to Government property (this was dated 28 June 2014). 4. A letter, dated 16 December 2014, shows DFAS notified the applicant his debt had been referred to the DFAS Debt Collection Management Office and provided him an Account Statement for information concerning the debt(s) along with payment instructions. He was informed to pay his debt in full within 30 days from the date of this letter, or he may repay the debt in installments. The first installment had to be submitted within 30 days along with the voluntary repayment agreement. If the debt was not paid in full within 30 days, interest would be established at the current Treasury Department tax and loan rate, and administrative, and penalty changes would be assessed under Title 31, U.S. Code, section 3717. 5. On 22 July 2015, the Department of Treasury corresponded with the applicant and informed him the debt (now $637.25) remained unpaid and he risked garnishment of his wages. On 20 August 2015, he responded by indicating he did not owe the full amount of the debt and requested a hearing. With his request, he submitted: a. DA Form 2062, that shows he signed for military equipment (parka, goggles, hood, canteen, bags, and trousers) on an unknown date. b. DD Form 362, dated 11 July 2014, that shows he was charged in the amount of $111 due to the loss of military equipment (infrared transmitter, liner, pad, and wet weather poncho). 6. A Summary Record and Hearing Decision, from the DFAS, Indianapolis Center, dated 28 October 2015, advised the applicant that: a. A hearing request, for the purpose of administrative wage garnishment, is not a formal, in-person hearing of the parties involved, it is a written review of the records pertaining to the case in order to validate the debt and ensure the debtor received due process in regard to debt collection procedures prior to an involuntary collection of pay. It is not an appeal to the reason for the debt, or a means to correct an injustice. However, the hearing official has the right to make corrections based on equity and good faith, provided the facts of the case supported such a correction. b. Debt owed to the Department of Defense (DOD) are collected by the Defense Debt Management System (DDMS). The Debt Collection Improvement Act of 1996 authorizes the accrual of interest, administrative fees, and penalty on unpaid debt over 30 days old, and the referral of the debt yearly, to the Internal Revenue Service for offset from possible income tax refunds. After initial DDMS collection efforts are exhausted, the delinquent account is submitted to the Department of Treasury for more aggressive collection efforts, to include administrative wage garnishment. The U.S. Treasury is authorized additional charges and processing fees of 28 percent of the debt amount, effective at the time of submission. c. In accordance with DOD Financial Management Regulation, Volume 5, Chapter 28, paragraph 281001 A and G, only one hearing is authorized per debt owed to DOD, and there is no provision for review or appeal of debt determination decisions rendered with regard to administrative offset; however, a debtor may exercise any other collection, appeal, waiver, remission, or review right that may be provided by other statute or regulation with regard to the debt. Paragraph 281005 E, of the cited reference also states the hearing official's decision is final for the purposes of Title 31, U.S. Code, 3716. d. The following is an investigation result pertaining to the applicant's debt in the principal amount of $486.20, for the loss of or damage to Government property. e. He contends that he does not owe the full amount of the debt. He has provided a statement of charges/cash collection voucher, dated 11 July 2014, and a DA Form 2082. f. Research shows he was discharged from the VAARNG on 25 July 2014. He failed to tum in all of the equipment assigned to him prior to discharge, and a Financial Liability Investigation (FLI) was conducted to determine if he was responsible for the loss. As a result of FLI, dated 28 June 2014, it was determined the applicant was negligent in his duty to safeguard the equipment; therefore, he was held financially liable for the loss, in the amount of $486.20. His debt was established to his Reserve pay record on 17 July 2014 by the VAARNG. g. The debt was interfaced with DDMS on 25 October 2014 and he was notified of the debt on 16 December 2014. Two letters requesting payment were mailed to him, neither of which was returned as undeliverable. One follow-up letter was issued even though only one demand letter is required by law. He made no attempt to contact the Debt and Claims Customer Care Center nor did he repay the debt. h. He was given sufficient time to resolve the debt and when it became delinquent, on 27 April 2015, it was referred to the Department of Treasury. i. On 22 July 2015, the Department of Treasury notified the applicant of their intent to collect the debt by Administrative Wage Garnishment (AWG). He did not comply with the requirement to request a hearing on or before 12 August 2015; however, AWG has not been initiated and collection of the debt has not commenced. j. After interest, penalty, and fees are assessed, his debt was as follows: $486.20 (principal), $1.65 (interest), and $10 (administrative fees). The amount referred to Treasury equals $497.85. Plus $139.40 (Treasury fees, 28% of $497.85) equals $637.25. k. He contends he does not owe the full amount of the debt. He has also provided a copy of a statement of charges/cash collection voucher dated 11 July 2014, and a copy of a DA Form 2082. He further states this is the fourth attempt by him to resolve the debt, and that he has turned in the items in dispute. l. It is unfortunate that he has not been able to resolve the issue. However, he should note that it is not within the purview or authority of an administrative hearing to adjust or cancel any portion of his debt. The Out of Service Debt Customer Care Center requires official documentation from the VAARNG requesting that his debt be adjusted. Collection of his debt is by agreement with the VAARNG and only they can adjust, cancel or concur on matters concerning the debt. He should contact the U.S. Property and Fiscal Office for Virginia with questions, concerns, or discrepancies regarding his debt. m. If he disagrees with the findings of the FLI, a possible avenue of relief is to petition the Army Board for Correction of Military Records (ABCMR) with supporting documentation. Applying to the ABCMR does not suspend the collection of the debt. lf the applicant receives a favorable decision from the ABCMR, any money over collected will be refunded. n. A review of the facts surrounding the case shows the appropriate collection actions and fee accruals were taken in accordance with the Debt Collection Improvement Act of 1996. It is determined that the applicant was provided more than the allowable time to make arrangements to repay the debt. Collection of the debt by AWG will ensure the DOD is reimbursed for the loss of funds caused by his failure to safeguard the equipment assigned to him. o. Based on a review of the applicant's records and pertinent documentation, it is determined the debt remains valid and the amount is correct. The applicant was provided due process and collection of the debt by administrative wage garnishment, not to exceed 15 percent of disposable pay, is proper. 7. Attempts made by the Board's staff to reach the 1st Battalion, 116th Infantry, VAARNG, to locate the Financial Liability Investigation yielded no results. REFERENCES: 1. Army Regulation 15-185 (ABCMR) states ABCMR members will review all applications that are properly before them to determine the existence of an error or injustice. The ABCMR will decide cases on the evidence of record. It is not an investigative body. The ABCMR may, in its discretion, hold a hearing. Applicants do not have a right to a hearing before the ABCMR. The Director or the ABCMR may grant a formal hearing whenever justice requires. 2. Army Regulation 600-4 (Remission or Cancellation of Debt) outlines the policies and guidance for remission or cancellation of indebtedness to the U.S. Army. It implements the provisions of Section 4837, Title 10, U.S. Code and DOD 7000.14–R, Volume 16, Chapter 4, Paragraphs 0401 and 0405. a. Paragraph 1-7 (Indebtedness to the U.S. Army that may be remitted under 32 USC 710(c )), states on the basis of the standards of this regulation, a debt incurred to the U.S. Army by an ARNG Soldier may be remitted or canceled under certain conditions. The debt must be established in a financial liability investigation of property loss (AR 735–5) for lost, damaged, or destroyed Government property issued to the ARNG. The remission or cancellation may only be requested for losses, damage, or destruction occurring after 30 September 1980. b. Paragraph 1-11(d) (Financial liability of investigation of property loss), states application packets for remission or cancellation of debts to the U.S. Army as a result of a financial liability of investigation of property loss are considered, if based on hardship only. A copy of the financial liability investigation of property loss must be submitted with the DA Form 3508 and enclosures. Requests based on injustice are not proper for consideration of remission or cancellation. If the Soldier believes the financial liability investigation of property loss is erroneous or unjust, an appeal may be made under AR 735–5. Final action on the application packet may be taken before a decision on the appeal, when such action is in the best interests of the United States. c. Paragraph 1-11(e) (Determining collection or proration), states the determination concerning collection or proration of debt to the U.S. Army pending final action on a DA Form 3508 and enclosures is made by DFAS. DFAS will contact the individual with how the debt will or may be paid. 3. Army Regulation 37-104-4 (Financial Administration – Military Pay and Allowances Policy) prescribes policies for entitlements and collections of pay and allowance for Soldiers. It is used in conjunction with the DOD Financial Management Regulation (DODFMR), Volume 7, Part A and DOD Number 7000.14-R (DODFMR). When the Secretary of Defense or any designee determines a Soldier is indebted to the U.S. Government, the amount of the debt may be collected from the Soldier’s pay. The Secretary of Defense may waive U.S. claims for erroneous payment of pay and allowance, including travel and transportation, totaling less than $1,500.00 or deny waivers of any amount. Waiver requests exceeding $1,500.00 will be referred to the Comptroller General of the U.S. together with the recommendation of the Director, DFAS. 4. A Principal Deputy of the Under Secretary of Defense memorandum delegates to the Secretary concerned a determination on a case-by-case basis that certain repayment will not be required, if it is determined that such repayment would be contrary to a personnel policy or management objectives, against equity and good conscience, or contrary to the best interest of the United States. DISCUSSION: 1. By regulation, an applicant is not entitled to a hearing before the ABCMR. Hearings may be authorized by a panel of the ABCMR or by the Director of the ABCMR. In this case, the evidence of record and independent evidence provided by the applicant is sufficient to render a fair and equitable decision at this time. 2. The applicant incurred a debt in the amount of $515.20, which consisted of $29.00 for SGLI premiums (since he was not attending drills, these premiums were paid on his behalf by the Government) and $486.20 is a recoupment due for the loss or damage to Government property. a. The complete facts and circumstances surrounding the applicant's loss of military equipment are not available for review with this case. However, the available evidence shows prior to the applicant's separation, he failed to turn in some or all of the equipment assigned to him and an FLI was conducted to determine if he was responsible for the loss. b. Although the results of this investigation are not available for review, as a result of the FLI, it was determined the applicant was negligent in his duty to safeguard the equipment; therefore, he was held financially liable for the loss, in the amount of $486.20. His debt was established to his Reserve pay record on 17 July 2014 by the VAARNG. c. He was notified of the debt, but did not pay it. His case was also reviewed by the DFAS Directorate of Debt and Claims Management which provided him a Summary Record and Hearing Decision that essentially determined the debt was valid and the amount was correct. The applicant was provided due process and collection of the debt by administrative wage garnishment was proper. //NOTHING FOLLOWS// ABCMR Record of Proceedings AR20150000953 Enclosure 1 ARMY BOARD FOR CORRECTION OF MILITARY RECORDS RECORD OF PROCEEDINGS ABCMR Record of Proceedings (cont) AR20160002279 2 ARMY BOARD FOR CORRECTION OF MILITARY RECORDS RECORD OF PROCEEDINGS Enclosure 1 ABCMR Record of Proceedings (cont) AR20160002279 7 ARMY BOARD FOR CORRECTION OF MILITARY RECORDS RECORD OF PROCEEDINGS Enclosure 2