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Defense Department Outlines Recoupment Policies

By Fred W. Baker III
American Forces Press Service

WASHINGTON, Nov. 29, 2007 – Defense Department policy prohibits services from recouping bonuses and other pay from servicemembers who do not complete their military contracts due to no fault of their own.

“Repayment will not be sought if the member’s inability to fulfill the eligibility requirements is due to circumstances determined reasonably beyond the member’s control,” the policy guidance put in place this year reads.

Pentagon officials re-stated their policy this week after a wounded soldier in Pennsylvania received a bill from the Army. Jordan Fox was an Army private first class wounded in an improvised explosive device explosion in Iraq. He was medically discharged and later received a letter demanding repayment of $2,800 of his $7,500 enlistment bonus. A second letter from the Army stated interest would be charged if a payment wasn’t made within 30 days.

Army officials later said Fox will not be required to pay back any enlistment money he received.

According to the policy, circumstances could include a servicemember’s death, injury, illness or other impairment which is not the result of the servicemember’s misconduct.

It could also apply if the servicemember is forced to reclassify into a new military specialty or if the servicemember is separated due to hardship.

The policy also allows for the service secretary to make case-by-case determinations on repayment.

Policy guidance published earlier this year also prohibits any debt collection from combat-related bonuses or incentives paid to a servicemember after medical evacuation form a combat zone. For example, if a soldier receives additional monthly combat pay and those payments are not stopped in a timely manner after his evacuation, the combat pay he receives after leaving the combat zone cannot be recouped by the services.

“Therefore, … the secretaries of the military departments, in coordination with the Defense Finance and Accounting Service, will expeditiously remit or cancel all theater debt incurred by members of the U.S. armed forces who were medically evacuated from a combat zone due to battle injury or illness, nor non-battle injury or illness, except when misconduct on the part of the member contributed to the indebtedness,” the guidance reads.

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