Pentagon suspends California National Guard bonus repayments

WASHINGTON -- The Pentagon worked Wednesday to stave off a public-relations nightmare, suspending efforts to force California National Guard troops who served in Iraq and Afghanistan to repay enlistment bonuses that may have been awarded improperly.

Defense Secretary Ash Carter ordered the suspension in the wake of angry reaction from congressional Republicans and Democrats.

They demanded he relieve the burden on Guard members after news reports soldiers were asked to repay bonuses that in some cases totaled more than $25,000.

The announcement does not end the reimbursement process, but postpones collection efforts as the Pentagon and Congress look for a long-term solution.

White House spokesman Josh Earnest said President Barack Obama was pleased with the decision but said it was important for the Pentagon "to follow through" by finding a long-term solution.

Obama warned the Defense Department earlier this week not to "nickel and dime" servicemembers who were victims of wrongdoing by overzealous recruiters.

In a statement during a meeting of defense ministers in Brussels, Carter said efforts to collect reimbursement from Guard members should stop "as soon as is practical."

Carter said he has ordered the department to set up a streamlined process by Jan. 1 to help troops get relief from the repayment obligation, because the current program moved too slowly.

Acting under secretary of defense for personnel and readiness Peter Levine said Wednesday the process of identifying and processing the California Guard members who might have to repay the money may take up to 10 days.

"If we determine that recoupment was unjustified, there will be a process that allows the recovery of that and the reversal of that money," Levine said.

Levine said they are looking to set up "a one-stop place" for those affected to get a hearing and review, noting the goal is to eliminate "a bunch of sequential processes." The details of that process haven't been determined, he said.

Among about 14,000 California Guard members whose bonuses and other incentive payments were reviewed, about 3,000 of those are men and women who since have left the National Guard, Levine said.

They will be eligible for repayment as well, but it hasn't been determined how those cases will be handled since they do not have current addresses or contact details for many of those individuals, he added.

Senate Armed Services Committee Chairman John McCain said the move by the Defense Department is "a long-overdue first step," and he vowed to work with Senate colleagues "to explore all options available to hold those responsible for this unacceptable situation accountable and to ensure this never happens again."

Rep. Jeff Miller, chairman of the House Committee on Veterans' Affairs, called the measure "a weak and ham-handed attempt to shift the focus away from the Obama administration's shameful treatment of service members and veterans."

"Carter seems to have no plan to make those who've already been forced to pay back their bonuses whole, and by focusing only on the California Guard, he is ignoring what media reports indicate could be a national problem," Miller said.

The Los Angeles Times reported over the weekend that the Pentagon demanded that thousands of soldiers repay their enlistment bonuses after audits revealed overpayments by the California National Guard. Recruiters under pressure to fill ranks and hit enlistment goals at the height of the two wars improperly offered bonuses of $15,000 or more to soldiers who re-enlisted.

If soldiers refuse to pay the bonus back, they could face interest charges, wage garnishments and tax liens.

"While some soldiers knew or should have known they were ineligible for benefits they were claiming, many others did not," Carter said, adding that the new process will put "as little burden as possible on any soldier who received an improper payment through no fault of his or her own. At the same time, it will respect our important obligation to the taxpayer."

But the country's largest combat veteran's organization, said the measure "doesn't go deep enough." Brian Duffy, national commander of the Veterans of Foreign Wars of the United States and its Auxiliary, said the erroneous bonuses were "the fault of a system, not of any recipient."

As many as 6,500 California National Guard soldiers have been asked to repay the enlistment bonuses.

"We deal with these problems all the time, but we deal with it in ones and twos, not in hundreds and thousands," said Gordon Trowbridge, deputy Pentagon press secretary. The Pentagon said it is investigating cases beyond California, but said those will likely add up to "dozens."

House Speaker Paul Ryan, R-Wis., who had pressed the Pentagon to suspend the program, said Wednesday, "I'm glad the Pentagon came to its senses."

House Majority Leader Kevin McCarthy, R-Calif., also welcomed the development, saying he spoke with Deputy Defense Secretary Robert Work Tuesday night and vowed to work with other members of Congress to provide a legislative solution so the repayment issue does not recur.

House Minority Leader Nancy Pelosi, D-Calif., welcomed the Pentagon announcement, but said lawmakers need to find a permanent solution.

"The heroes who served our country in uniform deserve every bonus and benefit they received in good faith," she said. "We all must work together to swiftly address this situation and monitor any additional issues that come up in California and other states."