B-123108, AUG. 27, 1956

B-123108, AUG. 27, 1956

TO THE ADMINISTRATOR, VETERANS ADMINISTRATION:

REFERENCE IS MADE TO A LETTER DATED AUGUST 9, 1956, FROM THE DEPUTY GENERAL COUNSEL, VETERANS ADMINISTRATION, TO OUR GENERAL COUNSEL, RELATIVE TO THE INDEBTEDNESS OF CHARLES L. RUSSELL, C-13 346 531, TO THE UNITED STATES AND TO SIMILAR INDEBTEDNESSES OF OTHER VETERANS WHICH ARISE SOLELY BECAUSE OF THEIR FAILURE TO FILE TIMELY PROOF OF DEPENDENCY AS REQUIRED BY THE VETERANS ADMINISTRATION REGULATIONS. THIS CASE WAS ALSO THE SUBJECT OF A LETTER DATED JULY 18, 1956, FROM THE DEPUTY ADMINISTRATOR, VETERANS ADMINISTRATION, TO OUR OFFICE.

"UPON FURTHER CONSIDERATION OF THIS MATTER IN THE LIGHT OF THE FOREGOING THE FOLLOWING POLICY IS BEING ADOPTED BY THE VETERANS ADMINISTRATION IN THIS CLASS OF CASES: THE VETERANS ADMINISTRATION WILL MAKE AN ADMINISTRATIVE DETERMINATION THAT IN CASES OF THIS KIND THE OVERPAYMENT WAS NOT DUE TO THE FAULT OF THE VETERAN AND THAT RECOVERY OF THE OUTSTANDING OVERPAYMENT WOULD BE AGAINST EQUITY AND GOOD CONSCIENCE OR WOULD OTHERWISE DEFEAT THE PURPOSE OF BENEFIT OTHERWISE AUTHORIZED (SEE SEC. 453, TITLE 38 U.S.C.), AND, THEREFORE, WILL WAIVE COLLECTION OF THE UNPAID BALANCE OF THE OVERPAYMENT WHICH HAD BEEN SET UP BECAUSE OF THE VETERAN'S FAILURE TO TIMELY FILE PROOF OF RELATIONSHIP AND/OR DEPENDENTS.'

ALSO, THE DEPUTY ADMINISTRATOR SUGGESTS THAT WE RETURN TO THE VETERANS ADMINISTRATION ALL CASES OF THIS TYPE WHICH HAVE BEEN REPORTED HERE BY YOU AS UNCOLLECTIBLE INDEBTEDNESS IN ORDER THAT THEY MAY BE RECONSIDERED UNDER THE POLICY SET FORTH ABOVE.

IN OUR LETTER OF JUNE 25, 1956, TO THE GENERAL COUNSEL, TRANSMITTING DOCUMENTS FURNISHED OUR OFFICE IN PROOF OF DEPENDENCY IN THE RUSSELL CASE WE REQUESTED THAT THEY BE RETURNED HERE AFTER THEIR PURPOSE HAD BEEN SERVED IN THE VETERANS ADMINISTRATION. THE DEPUTY GENERAL COUNSEL IN HIS LETTER OF AUGUST 9, 1956, SUGGESTS THAT PROOF OF DEPENDENCY DOCUMENTS SHOULD BE A PART OF THE PERMANENT RECORDS OF THE VETERANS ADMINISTRATION. HE ALSO SUGGESTS THAT ALL FUTURE INQUIRIES FROM VETERANS WHOSE INSURANCE DIVIDENDS HAVE BEEN OFFSET AGAINST INDEBTEDNESS UNDER CIRCUMSTANCES SIMILAR TO THOSE EXISTING IN THE CASE OF MR. RUSSELL ALSO BE FORWARDED TO THE VETERANS ADMINISTRATION MARKED FOR THE ATTENTION OF THE CHIEF, BENEFITS DIRECTOR, DEPARTMENT OF VETERANS BENEFITS, FOR REPLY AND FURTHER HANDLING.

WE CONCUR IN THE SUGGESTIONS EXPRESSED ABOVE AND ALL CASES NOW PENDING IN THIS OFFICE AS WELL AS FUTURE CORRESPONDENCE RECEIVED FROM VETERANS CONCERNING GOVERNMENT LIFE INSURANCE BENEFITS WHICH HAVE BEEN OFFSET AGAINST INDEBTEDNESSES ARISING UNDER THE VETERANS' BENEFITS ACTS WILL BE REFERRED TO THE VETERANS ADMINISTRATION FOR DISPOSITION.

CONCERNING THE RUSSELL CASE OUR CLAIMS DIVISION WILL ADVISE MR. RUSSELL THAT THE PAYMENT OF NATIONAL SERVICE LIFE INSURANCE DIVIDENDS WHICH WAS PROPERLY OFFSET UNDER THE VETERANS ADMINISTRATION REGULATIONS IN EFFECT AT THE TIME MAY NOT BE REFUNDED TO HIM.

THE DOCUMENTARY EVIDENCE CONCERNING THE RUSSELL CASE, TRANSMITTED WITH THE LETTER OF AUGUST 9, 1956, WILL BE RETURNED TO THE VETERANS ADMINISTRATION AS SOON AS OUR CLAIMS DIVISION HAS COMPLETED ITS ACTION.