How the Pentagon’s payroll quagmire traps soldiers
Filed Jul 2nd, 2013
By Scot J. Paltrow and Kelly Carr
U.S. Army combat medic Shawn Aiken gets dressed to visit the VA Medical
Center for an EKG appointment in El Paso, Texas May 24, 2013.
REUTERS/Ivan Pierre Aguirre
EL PASO, Texas - As Christmas 2011 approached, U.S. Army medic Shawn
Aiken was once again locked in desperate battle with a formidable foe.
Not insurgents in Iraq, or Taliban fighters in Afghanistan - enemies he
had already encountered with distinguished bravery.
This time, he was up against the U.S. Defense Department.
Aiken, then 30 years old, was in his second month of physical and
psychological reconstruction at Fort Bliss in El Paso, Texas, after two
tours of combat duty had left him shattered. His war-related afflictions
included traumatic brain injury, severe post-traumatic stress disorder
(PTSD), abnormal eye movements due to nerve damage, chronic pain, and a
hip injury.
But the problem that loomed largest that holiday season was different.
Aiken had no money. The Defense Department was withholding big chunks of
his pay. It had started that October, when he received $2,337.56,
instead of his normal monthly take-home pay of about $3,300. He quickly
raised the issue with staff. It only got worse. For all of December, his
pay came to $117.99.
__________________________________________________
All Aiken knew was that the Defense Department was taking back money it
claimed he owed. Beyond that, “they couldn’t even tell me what the debts
were from,” he says.
At the time, Aiken was living off base with his fiancee, Monica, and her
toddler daughter, while sharing custody of his two children with his
ex-wife. As their money dwindled, the couple began hitting church-run
food pantries. Aiken took out an Army Emergency Relief Loan to cover
expenses of their December move into a new apartment. At Christmas,
Operation Santa Claus provided the family with presents – one for each
child, per the charity’s rules.
Eventually, they began pawning their possessions – jewelry, games, an
iPhone, and even the medic bag Aiken used when saving lives in
Afghanistan. The couple was desperate from “just not knowing where
food's going to come from,” he says. “They just hit one button and they
take your whole paycheck away. And then you have to fight to get the
money back.”
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Aiken’s injuries made that fight more difficult. He limped from office
to office to press his case to an unyielding bureaucracy. With
short-term and long-term memory loss, he struggled to keep appointments
and remember key dates and events. His PTSD symptoms alienated some
staff. “He would have an outburst ... (and) they would treat him as if
he was like a bad soldier,” says Monica. “They weren’t compassionate.”
They were also wrong. The money the military took back from Aiken
resulted from accounting and other errors, and it should have been his
to keep. Further, even after Aiken complained, the Defense Department
didn’t return the bulk of the money to Aiken until after Reuters
inquired about his case.
PHOTO GALLERY: A veteran's debt
The Pentagon agency that identified the overpayments, clawed them back
and resisted Aiken's pleas for explanation and redress is the Defense
Finance and Accounting Service, or DFAS (pronounced “DEE-fass”). This
agency, with headquarters in Indianapolis, Indiana, has roughly 12,000
employees and, after cuts under the federal sequester, a $1.36 billion
budget. It is responsible for accurately paying America’s 2.7 million
active-duty and Reserve soldiers, sailors, airmen and Marines.
It often fails at that task, a Reuters investigation finds.
A review of individuals’ military pay records, government reports and
other documents, along with interviews with dozens of current and former
soldiers and other military personnel, confirms Aiken’s case is hardly
isolated. Pay errors in the military are widespread. And as Aiken and
many other soldiers have found, once mistakes are detected, getting them
corrected - or just explained - can test even the most persistent
soldiers (see
related story).
“Too often, a soldier who has a problem with his or her pay can wait
days, weeks or even months to get things sorted out,” Democratic Senator
Thomas Carper of Delaware, chairman of the Homeland Security and
Governmental Affairs Committee, wrote in an email. “This is simply
unacceptable.”
Reuters found multiple examples of pay mistakes affecting active-duty
personnel and discharged soldiers. Some are erroneously shortchanged on
pay. Others are mistakenly overpaid and then see their earnings
drastically cut as DFAS recoups the money, or, like Aiken, they are
forced to pay money that was rightfully theirs.
Precise totals on the extent and cost of these mistakes are impossible
to come by, and for the very reason the errors plague the military in
the first place: the Defense Department’s jury-rigged network of mostly
incompatible computer systems for payroll and accounting, many of them
decades old, long obsolete, and unable to communicate with each other.
The DFAS accounting system still uses a half-century-old computer
language that is largely unable to communicate with the equally outmoded
personnel management systems employed by each of the military services.
Source: April 2012 GAO report
In a December 2012 report on Army pay, the Government Accountability
Office said DFAS and the Army have no way to ensure correct pay for
soldiers and no way to track errors. These deficiencies, it said,
“increase the risk that the nearly $47 billion in reported fiscal year
2011 Army active duty military payroll includes Army servicemembers who
received pay to which they were not entitled and others who did not
receive the full pay they were due.”
In a written response to the report, Robert Hale, the Defense
Department’s comptroller, said, “I agree that we need to strive to
improve payroll accuracy,” but added that the GAO had overstated the
problem and mischaracterized some of the debts as errors.
NO-ACCOUNT ACCOUNTING
IN THE DARK: When Shawn Aiken sought answers about the deductions from
his pay, “they couldn’t even tell me what the debts were from,” he says.
REUTERS/Ivan Pierre Aguirre
Pay errors are part of a larger phenomenon that Reuters will explore in
a series of articles: the Defense Department’s endemic failure to keep
track of its money – how much it has, how much it pays out and how much
is lost or stolen.
The department’s authorized 2013 budget, after sequester, totals $565.8
billion - by far the largest chunk of the annual federal budget approved
by Congress. Yet the Pentagon is literally unable to account for itself.
As proof, consider that a law in effect since 1992 requires annual
audits of all federal agencies – and the Pentagon alone has never
complied. It annually reports to Congress that its books are in such
disarray that an audit is impossible.
In this series, Reuters will delve into how an organization that fields
the most sophisticated technology in the world to fight wars and spy on
enemies has come to rely on an accounting system of antiquated,
error-prone computers; how these thousands of duplicative and
inefficient systems cost billions of dollars to staff and maintain; how
efforts to replace these systems with better ones have ended in costly
failures; and how it all adds up to billions of taxpayer dollars a year
in losses to mismanagement, theft and fraud.
For all its errors, Pentagon record-keeping is an expensive endeavor.
For fiscal 2012, ended Sept. 30, the Defense Department requested $17.3
billion to operate, maintain and modernize the more than 2,200 systems
it uses to manage finances, human resources, logistics, property, and
weapons acquisitions, according to an April 2012 GAO report. That amount
does not include billions of dollars more in each of the military
services’ “operations and maintenance” budgets used for upkeep of the
systems. Nor does it cover all of DFAS's $1 billion-plus budget.
___________________________________________________
The issue has yet to garner much attention in the political arena,
despite continuing debate over the U.S. government’s deficits and
efforts to restore fiscal order. More immediately, the mess in Pentagon
pay in particular carries implications for national security. In its
December 2012 report,
the GAO recognized that fielding soldiers burdened with pay errors “may
pose financial hardship for the soldiers and detract from their focus on
mission.”
Officers complain that the difficulty of keeping track of personnel
makes it harder to deploy men and women in times of war. Retired
four-star Navy Admiral William J. Fallon says that while serving in 2007
and 2008 as chief of the U.S. Central Command, overseeing joint military
operations in Afghanistan and Iraq, he had to maintain “an incredibly
bloated staff” from each of the services to keep him informed of the
numbers and availability of troops. “It is an incredibly inefficient,
wasteful way of doing business,” he says.
This way of doing business has also proved resistant to change. A
recalcitrant bureaucracy, competing priorities - war, among others - and
until recently, congressional indifference have stymied any efforts to
impose order. Most notable among those efforts: a project to install a
new, unified pay- and personnel-management system that eventually ate
more than $1 billion before the Pentagon killed it.
“If you look at the things this country has done, how hard is this?”
says Daniel Denning, assistant secretary of the Army for manpower and
Reserve affairs from 2002 to 2007 and now a consultant at MBO Partners
LLC in McLean, Virginia. “If someone could put something like Facebook
together or Google, one would think that bringing these decades-old
military personnel and pay systems into the 2012 world shouldn’t be that
hard.”
Source: Center for Strategic and Budgetary Assessments (top); Office of
Management and Budget
"FINGER-GAPPING"
The mistakes in soldiers’ pay may seem small - $1,000 here, a few
hundred there. But for an Army private first class making a base annual
salary of about $23,000, or a wounded veteran on disability, they can be
devastating. Former soldiers have had their civilian wages and their
Veterans Administration benefits garnished. They have been pursued by
private collection agencies and forced to pay tax penalties. In other
cases, too, deserters have continued to be paid for months, and
sometimes years, after disappearing.
The Pentagon’s record-keeping tangle not only increases the potential
for errors; it also forces DFAS to depend heavily on “manual
workarounds,” another source of errors. Neither the Pentagon or DFAS or
the military services can specify how many workers are used to handle
these tasks, but “it takes a massive amount of human effort,” says Roy
Wallace, an Army assistant deputy chief of staff.
“At last count, there were 167 manual workarounds” for the 40-year-old
pay system used by DFAS and all the services except the Marines, he
says. As a result, staff often must transcribe information from one
system onto paper, carry it to another office, and hand it off to other
workers who then manually enter it into other systems – a process called
“finger-gapping” that Wallace faults as a further source of errors.
Another sort of workaround was a main reason for Aiken’s hardships at
Fort Bliss. Injured by a rocket-propelled grenade in Afghanistan, Aiken
was eventually sent to an Army hospital in Landstuhl, Germany. Upon
arrival there, he should have been designated as a “wounded warrior,” a
status that would have automatically forgiven all debts related to the
overpayments DFAS later claimed and entitled him to benefits he didn't
receive.
Lacking a unified, automated system to process soldiers arriving from
combat zones, DFAS had to post staff at Landstuhl to do the work in
person, by hand – but only for those soldiers arriving by air. Aiken,
who had already moved with his unit from Afghanistan to another location
in Germany, arrived by bus.
BATTLE FATIGUE: With severe PTSD, traumatic brain injury, a damaged hip
and other war-related damage, Shawn Aiken was undergoing treatment and
therapy as he limped from office to office at Fort Bliss, texas, seeking
relief from the Pentagon’s deductions from his pay. REUTERS/Ivan Pierre
Aguirre
“We’re not out to screw our own people,” said Defense Department
Comptroller Hale, to whom DFAS reports. “The military pay system is just
very complex.”
DFAS said pay errors are extremely rare. Based on a self-audit, it said,
its accuracy for pay and calculation of benefits for military personnel
in the nine months through July 2012 was 99.76 percent. The agency also
said it had undergone partial audits for pay accuracy by the inspector
general of the Defense Department and by the GAO.
But a spokeswoman for the Defense Department inspector general and a
senior GAO official said their respective offices hadn’t audited the
overall accuracy of DFAS pay in the past five years, and neither could
recall any such audit ever having been conducted.
Further, in a report issued in February this year, the Defense
Department inspector general found “significant deficiencies” in DFAS’s
own internal auditing organization. These included failure to “exercise
sufficient professional judgment,” ineffective quality-control
monitoring and failure to comply with required accounting standards.
DFAS Director Teresa McKay declined to be interviewed for this article
and declined to allow Reuters to interview any other DFAS personnel. Her
boss, Pentagon Comptroller Hale, backed that decision. The agency
accepted only written questions.
Source: DFAS
"In general, what we often find and what we are trying to do a better
job of explaining to our customers, is they are not familiar with (and
in some cases, not happy with) the time needed for us to process and
correct errors,” DFAS spokesman Thomas LaRock said in an email. “Each
case and any associated documentation must be reviewed by DFAS and the
military service before a final decision on the validity of the debt or
claim can be made.”
WALKING DEAD
When the U.S. invaded Iraq in 2003, retired four-star general Peter
Schoomaker heeded a call from Defense Secretary Donald Rumsfeld to
return to active duty - as Army chief of staff, the highest military
rank in the Army.
Schoomaker returned to work, but he didn't get paid. DFAS had -
correctly - stopped Schoomaker’s monthly retirement checks when he
resumed active duty. But its computers weren’t able to restart pay for a
soldier returning from retirement.
It took months for Schoomaker to start receiving his pay, and even more
to get reimbursed for the months he had been stiffed.
In the meantime, soon after Schoomaker’s return to active duty, a
computer-generated letter arrived at his home, addressed to his wife and
offering condolences on the general’s death. DFAS’s computers were
programmed to assume that when a retiree was taken off the rolls, that
person had died.
The letter didn’t cause any undue alarm at the Schoomaker home; the
general was living there at the time. He did notice that the letter
spelled his name three different ways.
“If the Chief of Staff of the Army is treated that way,” Schoomaker
says, “you can imagine how a private is treated.”
James Watkins, assistant secretary of the Army for financial management,
said the system has been reprogrammed to fix the glitch that prompted
the condolence letter: “We would catch that today,” he said.
The same can’t be said for the pay error that affected Schoomaker. The
reason lies in the origins of DFAS.
Source: Peter Schoomaker
The agency was born in the push to realize savings in defense spending
after the Cold War. To that end, then-Defense Secretary Dick Cheney in
1991 approved a plan to create DFAS by consolidating into one entity
some of the overlapping pay and accounting functions that had been
performed separately by each of the military services.
But the consolidation wasn’t complete. While the newly created DFAS
would handle payroll duties across all branches of the military,
personnel responsibilities would remain with each of the services. That
decision haunts the Pentagon to this day.
Information handled by the personnel departments of the military
branches plays a big part in determining how much a soldier is paid.
This information includes promotions, discharges, assignment changes,
marriages and divorces.
Congress has made it even more complicated in recent decades by
establishing a multitude of pay levels. There is basic pay, plus
“entitlements” for everything from serving in a combat zone to housing
allowances to re-enlistment bonuses. An individual’s pay can change
several times in a day.
With the creation of DFAS, ensuring correct pay for soldiers required
speedy, efficient communication between the new agency handling payroll
and the different military branches, each still running its own
personnel operations. No one was prepared.
DFAS, for its part, inherited a pay operation that even at the time was
an antique - a 20-year-old Air Force system that DFAS renamed the
Defense Joint Military Pay System, or DJMS. It ran, and still runs, on
Cobol, a computer language that dates to 1959. Most of the Cobol code
the Pentagon uses for payroll and accounting was written in the 1960s,
according to 2006 congressional testimony by Zack Gaddy, director of
DFAS from May 2004 to September 2008.
Source: GAO
Wallace, the Army assistant deputy chief of staff, says the system has
“seven million lines of Cobol code that hasn’t been updated” in more
than a dozen years, and significant parts of the code have been
“corrupted.” The older it gets, the harder it is to maintain. As DFAS
itself said: “As time passes, the pool of Cobol expertise dwindles.”
Further, the system is nearly impossible to update because the
documentation for it - explaining how it was built, what was in it, and
how it works - disappeared long ago, according to Kevin McGraw. He
retired recently after working 30 years in DFAS's Cleveland office, most
of that time responsible for maintaining the part of DJMS that handles
Navy pay. "It's hard to make a change to a program if you don't know
what's in there," McGraw says.
Most of the personnel systems that each of the military services
operates are just as old and obsolete. Typically, within each branch,
different systems handle different categories of active-duty soldiers,
while still others handle Reserve and National Guard personnel. Most of
these systems can’t talk to each other. And each has its own pipeline
into DFAS, with its own way of translating data into a form that DFAS
can use in its separate systems for active-duty and for Reserve and
Guard personnel.
Donald Shycoff, deputy comptroller at the Defense Department when DFAS
was formed two decades ago, says that the intention of establishing the
agency was to save money, and that there was no discussion then about
the potential impact of separating pay and personnel functions.
Cheney, through a spokesman, declined to comment.
To catch mistakes, the Army relies mainly on local commanders to review
monthly pay figures and report any errors. The GAO found that the Army
doesn’t enforce the requirement. From October 2011 through March 2012,
it said, 26 percent of the monthly reports were turned in late or not at
all. At some bases, the rate was as high as 40 percent.
Source: DFAS; Shawn Aiken
The heavy reliance on paperwork in the absence of unified pay and
personnel systems also means that money continues to flow to soldiers
who are absent without leave and others who shouldn’t get it.
Spokesmen for the military services said that when an individual goes
AWOL, the name and other identifying information are sent to the Defense
Manpower Data Center, an office under the secretary of defense. A
spokeswoman for the secretary of defense’s office said the center does
not check with DFAS to make sure that pay to AWOL personnel is stopped.
It’s up to the individual services to notify DFAS, she said, which “is a
proven means of doing business.”
Commanders often don’t bother to notify DFAS about an AWOL soldier,
though they are required to do so, according to the December GAO report.
Similarly, National Guard and Reserve personnel who leave active duty
but don’t fill out the required paperwork may continue to receive pay.
Beginning in November 2009, Carl W. Marquis of Burke, Virginia, then a
commander in the Navy Reserves, spent three months on active duty at the
Patuxent River Naval Air Station in Maryland. When his tour ended, he
didn’t sign out. DFAS continued depositing full active-duty pay into his
bank account for 15 months, totaling $159,712.
Source: DFAS
DFAS and Navy officials learned of the mistake only after an
administrator with Marquis’s Reserve unit in Virginia questioned why his
name was missing from the unit’s rolls. By then, he had spent all but
$25,000 of the money, court records show. In December 2011, Marquis
pleaded guilty to a “concealment” charge and was sentenced to four
months in jail.
Marquis, now a fitness trainer in Reston, Virginia, declined to comment.
“ONE OF OUR HEROES”
Gary J. Pfleider II had been through rehab for drug addiction and was
working at a Wal-Mart and a pizza restaurant when he joined the Oregon
National Guard in October 2001. He says he wanted to “do something for
my country” after the Sept. 11, 2001, terrorist attacks and keep his
life on the right track for his two little girls.
INSULT, AFTER INJURY: Wounded warrior Gary J. Pfleider II couldn t
afford to stay in his apartment after the Pentagon moved aggressively to
collect erroneous debts from him, forcing him to move into a shack
behind his parents house in Lebanon, Oregon. REUTERS/Steve DiPaola
Repeatedly denied deployment to Iraq because of his drug record, he
wrote a letter in pencil on lined paper to then-First Sergeant Michael
Amen “beging (sic) and pleading with you to please let me deploy out.
... This deployment is all I have left.”
INSULT, AFTER INJURY: Wounded warrior Gary J. Pfleider II couldn t
afford to stay in his apartment after the Pentagon moved aggressively to
collect erroneous debts from him, forcing him to move into a shack
behind his parents house in Lebanon, Oregon. REUTERS/Steve DiPaola
Amen acceded, and wasn’t disappointed. “Gary was a tremendous soldier
and asset to the unit,” Amen says. Capt. Stephen Bomar, who also was
with Pfleider in Iraq, says, “He is one of our heroes.”
Pfleider (pronounced FLY-der) was a specialist in a National Guard unit
assigned to fill craters blasted into roads by improvised explosive
devices. On Sept. 24, 2007, his platoon was working on “Route Tampa,” 43
miles from a military base in Balad, central Iraq, when a sniper’s
bullet tore through his left thigh, severing arteries before punching
out a six-inch-long exit wound.
In the ensuing days, he nearly bled to death three times. Recovery was
slow. He lost a big chunk of thigh muscle to gangrene.
In February 2009, five months after his discharge, Pfleider was back in
his hometown of Lebanon, Oregon, when he received from DFAS a bill for
$3,136.73 and a warning that he had 30 days to pay. In subsequent bills,
the amount increased steadily, mainly from interest and penalties.
DFAS moved aggressively to collect. By March 2010, the Treasury, on
DFAS’s behalf, had clawed back $1,630 by withholding Pfleider’s 2009 tax
refund and garnishing his federal benefits. After keeping $97 in
administrative fees, it turned over $1,533 to DFAS. The Treasury then
handed off the balance of Pfleider’s debt – about $2,100 – to a private
collection agency, which Pfleider says hasn't tried to recoup the money
since sending an initial debt notice.
The 36-year-old Pfleider, a lean 6 foot 2 with a buzz cut, a beard and a
ring in each ear, doesn’t work. He often walks with a cane, is usually
in pain, and suffers from severe PTSD, with flashbacks, panic attacks,
occasional fits of rage, and night terrors. His only income is from
Social Security and VA benefits, totaling $1,992 a month.
Unable to afford the rent on his apartment, Pfleider moved into a
workshop in back of his parents’ house. He doesn’t drive, and lack of
money makes it hard to visit his two daughters, who live with their
mother in Washington state.
Around the time DFAS was dunning him, Pfleider received a separate
surprise from the Oregon National Guard: an itemized demand for $1,400,
representing the value of equipment - a helmet, a sleeping bag and the
like - that he didn’t return before he was medevacked out of Iraq.
“What was I supposed to do?” he says. “Stop and gather up all my gear
and make sure I brought every piece with me on the plane?”
Television station KVAL in Eugene, Oregon, did a story about that
equipment bill in May 2010. The next day, the Guard said it had dropped
the claim.
He got no such relief from DFAS. Pfleider says he didn’t see wording on
the first DFAS bill stating that the $3,136.73 debt was for three weeks
the agency had erroneously paid him after his discharge. Later bills
said nothing about the source of the debt.
It turns out that nearly all of Pfleider’s debt resulted from errors by
the Army, DFAS and the Oregon National Guard. Pfleider was mistakenly
paid for the extra three weeks because the Army had reported his
discharge a month late, DFAS said. He also was overpaid after Army
officials demoted him several months before his discharge.
___________________________________________________
The demotion resulted from a failed drug test after Pfleider returned
from a weekend with family in Lebanon. Documents related to the demotion
say Pfleider tested positive for methamphetamine; Pfleider says he took
methadone, an old prescription from earlier treatments, to relieve leg
pain when a missed bus forced to him to sleep on a station floor.
DFAS records show that after the Army demoted Pfleider in February 2008,
the Oregon National Guard mistakenly promoted him. After confused
communications between the Army and the National Guard, the Guard then
demoted and re-promoted Pfleider several times. Because Pfleider was on
active duty, the Guard had no legal authority to change Pfleider’s rank
or pay; only the Army did. DFAS erroneously accepted the promotions and
demotions the Guard reported, raising and lowering Pfleider’s salary
accordingly.
Most of the salary overpayments were recouped by DFAS when it docked
Pfleider’s pay before he left the service. Even so, DFAS said Pfleider
still owed $1,098.87 for such overpayments when he was discharged in
September 2008.
In response to inquiries from Reuters, DFAS accountants reviewed
Pfleider’s pay records and sent to Reuters a four-page analysis that,
among other things, found additional debts charged to Pfleider by
mistake and benefits not paid.
Sources: DFAS; Fort Bliss Wounded Warrior Battalion staff; Shawn Aiken
DFAS confirmed that most of the debts charged to Pfleider should have
been canceled because of his status as a wounded warrior and other
reasons. DFAS couldn’t erase the $1,098.87 Pfleider still owed for
salary overpayments because Defense Department rules forbid cancellation
of any debts related to a demotion under the Uniform Code of Military
Justice - even if those debts result from payments made in error.
Pfleider’s revised total debt of $1,098.87 was less than the $1,533 the
Treasury had already collected from him on behalf of DFAS. After
accounting for other, smaller underpayments to Pfleider, as well as
interest and penalties, DFAS said his final total debt came to $815.50 –
or only about 25 percent of what it had claimed when it started sending
bills to him. DFAS deducted that from the $1,533 it already had
collected and in mid-April, a month after Reuters inquired about his
case, paid him the balance of $717.50.
When soldiers like Pfleider and Aiken seek explanations about pay
problems, getting answers is tough. It’s hard for DFAS to find answers,
too. Because of the division between pay and personnel, the agency must
submit requests to personnel staff at the relevant branch of the
military when it wants questions answered.
The wait can take weeks or longer.
DFAS debt notices tell soldiers to address any questions or challenges
to the agency. But DFAS admits it often doesn’t investigate errors, and
generally refers military personnel back to their units, telling them to
provide documentary proof to support their claims. Likewise, DFAS said
it does not review for potential underpayments the pay records of
personnel as they prepare to leave their branch of service or after they
leave.
DFAS does operate call centers. In 2011, it said, those centers received
726,680 calls from current and former military personnel, mostly with
routine inquiries. The agency said it often refers callers to their
units.
Pavlos Kaltsas was a Navy officer who held several senior positions at
DFAS through 2005, including overseeing a call center for Navy personnel
in Cleveland, Ohio. Staff were limited in what they could do, he says,
because they were unable to retrieve the necessary information or make
the necessary changes on the computers in front of them. Kaltsas says
call center staff often told military personnel to check back in a few
weeks – in “the hope that the member just gives up.”
Every few days, he says, a Navy officer who had paid his way to
Cleveland would show up, refusing to leave until his pay problem was
fixed. Kaltsas, assigned to deal with some of them, says that despite
his efforts, he often wasn’t able to get DFAS to resolve mistakes.
Craig Arndt, a Navy captain, was one of those who showed up. While
stationed in Kuwait from 1999 through 2002, he called DFAS to ask that
it pay him the special allowances and entitlements he should have been
receiving. He got nowhere.
Source: Kevin McGraw, retired DFAS employee of 30 years
Later, while on leave in 2003 and again in 2005, he paid his own airfare
from his home in Florida to Cleveland to demand what he was owed. Arndt
says that at the end of his second visit, with the issue still
unresolved, Karl Bernhardt, a senior pay official, told him that DFAS
staff had already spent an inordinate amount of time on Arndt’s case.
Arndt persisted. “They couldn't push me around because I was a captain,”
he says.
Arndt, who retired in 2011 after 30 years in the Navy, eventually
accepted a settlement of $15,000. "I don't even know if that was all of
it," he says, because of the difficulty of calculating all of the
various entitlements he says he was owed. DFAS denied his separate claim
of $2,000 to cover an increase in life-insurance premiums after the
agency switched his coverage without telling him.
Bernhardt, the senior pay official, said he doesn’t recall Arndt or the
incident or any time when an officer paid his or her way to Cleveland to
complain about a pay error and attempt to get it fixed.
DFAS said it has put in place a certification program for call center
employees and plans additional improvements for the centers. It also
said it has “not had, in recent years, military people show up uninvited
at DFAS Offices to request or demand that perceived pay problems be
corrected.”
JUST ANOTHER ACRONYM
It wasn’t until after the start of the first Gulf War, in 1990, that the
problem of pay errors took on any urgency as thousands of Reserve and
National Guard personnel were mobilized for Operation Desert Storm.
___________________________________________________
For months, many of the soldiers called up weren’t paid because the
system couldn’t put them on the active-duty payroll, according to Eric
Reid, director of the Army Financial Command. Many found themselves on
both Reserve and active-duty payrolls, and were thus paid twice. Later,
thousands of demobilized soldiers continued to receive their active-duty
pay because the systems were unable to remove them from the active-duty
rosters.
In 1996, Defense Secretary William Perry and his staff were sufficiently
alarmed to ask the Defense Science Board - a group of corporate
executives and senior military personnel that advises the Pentagon on
technology - to study the problem and offer ideas for fixes.
The board was unsparing in its criticism. The pay system was “obsolete,”
it said in its report. It concluded that dysfunctions of the system
“damage the morale and welfare of the Service members and their
families.”
The board’s recommendation: Scrap the current system. The Pentagon
should emulate big corporations and implement a “single, all-Service and
all-component, fully integrated personnel and pay system, with common
core software.”
RECOGNITION DUE: Shawn Aiken was injured while serving in Iraq and
Afghanistan, but the Pentagon s pay personnel failed to designate him as
a wounded warrior on at least two occasions when doing so would have
erased his alleged debts and prevented his family s ordeal.
REUTERS/Handout Picture
Thus was born the Defense Integrated Military Human Resources System, or
DIMHRS (pronounced DIME-ers). Under the plan, the Defense Department
would buy a commercial, off-the-shelf personnel system and install it
with minimal modifications. It chose a product from PeopleSoft, the big
human-resources and managerial software maker, since acquired by Oracle
Corp.
Under this system, when a soldier’s status changed, his or her pay and
benefits would be updated with a few keystrokes. Soldiers would be able
to change certain information – applying for additional pay after
getting married, for example. And DIMHRS would combine the separate
systems for active-duty and Reserve personnel.
The Pentagon told Congress in 1997 that the new system would cost $577
million. That was cheap, given the savings that would result from
eliminating 88 pay and personnel systems, the secretary of defense’s
office said at the time. It would be phased in quickly, beginning with
the Army in 2004.
Soon after development got under way, delays began to mount, and costs
began to rise. Staff in the individual services insisted on changes to
accommodate their particular needs. They wanted DIMHRS to be grafted on
top of existing systems. Months stretched into years. The services were
insisting on “15,000 requirements, and they were adding requirements
when I left in 2009,” says Nelson Ford, former undersecretary of the
Army. “I concluded that DIMHRS was not going to work.”
Source: DFAS
Tina Jonas, the Pentagon’s chief financial officer from 2004 to 2008,
and other officials overseeing the project say it wasn’t a priority
among top brass, who left implementation to lower-level managers, rarely
checking in on progress.
In early 2009, the system was still undergoing testing. Deputy Secretary
of Defense Gordon England, about to leave office as the new Obama
administration was settling in, wanted to make a final decision on
whether to continue spending money to impose DIMHRS on a reluctant
bureaucracy, or kill it.
At a meeting Jan. 14, 2009, England gathered together the secretaries of
the Army, Navy and Air Force and their top-ranking generals and
admirals, along with DIMHRS personnel, to discuss the issue. The
consensus, according to participants, was that the only way to make it
work would be to pull a four-star general from the wars in Iraq and
Afghanistan to manage what they saw as a bookkeeping project.
England pulled the plug. After more than a decade of development and
more than $1 billion of taxpayer money spent, DIMHRS was dead. England
and the military leaders agreed to let each of the military services
pick from the remains of the project to update their own, separate
systems.
___________________________________________________
England, now president of defense consulting firm E6 Partners, says he
has come to believe that DIMHRS was doomed from the start: “The payroll
systems in DOD are hugely complex.”
Defense Secretary Robert Gates revealed the decision to dump DIMHRS in
testimony before the Senate Armed Services Committee in February 2010.
For the money spent, he told the committee, all that the military got
was “an unpronounceable acronym.”
Roland Burris, who served just 21 months in the Senate after his
controversial appointment by disgraced Illinois Governor Rod
Blagojevich, was the only senator at the hearing to react to Gates’s
announcement, saying the U.S. “could save millions and millions of
dollars” with a rationalized military pay system.
A spokeswoman for Democratic Senator Carl Levin of Michigan, the
committee chairman, said other members were focused on budgeting for the
wars in Iraq and Afghanistan and “didn’t have time to get to every other
issue of importance.”
More recently, several lawmakers have been pressing the Pentagon to
reform its record-keeping systems. Senator Carper, the Delaware
Democrat, and Senator Tom Coburn of Oklahoma, the ranking Republican on
the Homeland Security and Government Affairs Committee, have conducted
investigations and requested GAO audits of the military - including the
audit released in December last year.
“Unfortunately the problem of pay errors at the Department of Defense is
widespread and will continue,” Carper said, unless Congress, the White
House and military leaders make concerted efforts to correct it.
NOTHING TO WORRY ABOUT
On the DFAS website, a page devoted to wounded warriors reassures them
of its commitment. “From the moment you leave the combat zone,” it says,
“our Wounded Warrior Pay Management teams are at work to make sure your
pay and other entitlements don't become things that you or your family
have to worry about.”
Shawn Aiken had a different experience.
The wounded warrior was a high-school student in Blair, Nebraska, a few
miles north of Omaha, when his mother was diagnosed with stomach cancer.
He helped care for her until her death a year after his graduation. He
enlisted in the Army in June 2003, at age 22, after a small business he
had started foundered. He was drawn to a medical specialty; with
training, he qualified as a combat medic.
Aiken’s combat tours began in August 2005, when he was deployed with the
172nd Stryker Brigade to Mosul, Iraq. Three months later, he was the
only medically trained soldier accompanying two platoons on patrol
outside of Mosul when they were ambushed. Troops traced the gunfire to a
nearby house. They fought their way inside. The house blew up. Aiken was
alone to treat 23 wounded soldiers until help arrived.
U.S. Army combat medic Shawn Aiken holds up the bag of his prescription
medicines at his home in El Paso, Texas on May 20, 2013. REUTERS/Ivan
Pierre Aguirre
He ignored the screams of those he knew he couldn’t save in order to
focus on those he could. “I still see the faces of some of the guys that
were laying there, screaming and crying for help,” he says.
Aiken retains the boyish face that beams from snapshots taken while he
was serving overseas. He speaks haltingly, and stops when his memory
fails him. Still, he can’t forget when he was standing next to one of
his best buddies, a fellow medic, and cracked a joke. His friend burst
out laughing and flung his arms in the air - just as a sniper’s bullet
pierced his armpit and tore through his chest. “All the way to the
hospital I did CPR on him, but there was nothing I could do to save
him,” Aiken says.
In 2006, the Army awarded Aiken an Army Commendation Medal for saving
three lives in two days of combat in Iraq.
In 2010, after re-enlisting, Aiken was in Afghanistan when an armored
vehicle he was riding in hit an anti-tank mine. Aiken suffered a
concussion and neck and back injuries.
Later that year, a rocket-propelled grenade blasted him through the air
and sent him slamming head-first onto hard ground.
His commanders wanted to evacuate him to the Army’s Landstuhl Regional
Medical Center in Germany. He pleaded with them to let him remain
because as a sergeant, he says, he felt a responsibility to his men.
They relented, but forbade him to go on patrol. Weeks later, Aiken’s
unit was transferred to Schweinfurt, Germany, where he began visiting
Landstuhl for treatment.
U.S. Army combat medic Shawn Aiken is shown during his EKG appointment
at the VA Medical Center in El Paso, Texas on May 24, 2013. REUTERS/Ivan
Pierre Aguirre
At that point, everyone familiar with Aiken’s case agrees, he should
have been designated a “wounded warrior.” That status entitles soldiers
to receive special pay while they are hospitalized or in “warrior
transition units.” Most debts to the military are to be canceled. And
the exemption from income taxes for soldiers in combat zones is extended
while they are hospitalized.
But Aiken was taking a bus on his visits to Landstuhl. DFAS staff there,
meeting wounded warriors as they arrived by air, never caught him in
their system.
Back in Germany after a leave in the United States, Aiken, depressed and
still suffering from PTSD, gulped down lethal doses of the drugs Xanax
and OxyContin. Just before losing consciousness, he telephoned a friend,
who raced over and got him to the hospital in time for staff to save
him.
Landstuhl doctors sent him to a VA hospital in North Chicago, Illinois,
for specialized treatment for his PTSD. After nearly 15 weeks there, he
was discharged and sent back to Germany. In August 2011, he was demoted
from sergeant to specialist for having beaten up a fellow soldier in a
fight in Afghanistan.
Finally, in October 2011, the Army - for “compassionate reasons” -
transferred him to Fort Bliss, Texas. There he could be closer to
Monica, a former soldier herself, and his two children with the wife he
was divorcing, who live in El Paso.
Aiken was now assigned to the warrior transition battalion at Fort
Bliss. Upon arrival there, he was “in-processed” by DFAS personnel who,
after reviewing Aiken’s pay records, determined that he owed several
thousand dollars to the Defense Department for earlier overpayments.
They put through orders to dock his pay.
The DFAS personnel evidently never noticed that Aiken had not been given
wounded warrior status. If they had caught the error, then by law
Aiken’s debts would have been waived, and he and his family would have
been spared their financial ordeal.
DFAS spokesman LaRock said the agency has “no part in designating a
soldier as a wounded warrior.” That responsibility, he said, rests with
the medical department of the relevant military service - in Aiken’s
case, the Army Medical Department.
Margaret Tippy, a spokeswoman for the Army Medical Department, said she
could “say with certainty” that her department doesn’t have primary
responsibility for designating a soldier as a wounded warrior.
Earlier statements by Pentagon officials indicate it is DFAS’s job to
designate wounded warriors. In congressional testimony in 2006,
then-DFAS Director Gaddy said the agency had developed a “Wounded in
Action Pay Management Program,” and that “we identify and monitor all
battle-injured and non-battle-injured soldiers who have served in a
combat zone from October 7, 2001, to the present.” At the same hearing,
then-Pentagon Comptroller J. David Patterson said oversight of wounded
warriors was the responsibility of his office and DFAS.
It wasn’t until February 2012 - after Aiken had taken out loans, pawned
his belongings and accepted charity to keep him and his family afloat
through Christmas and beyond - that his nurse case manager noticed he
wasn’t listed as a wounded warrior. On Feb. 27, he was officially
declared one.
In March, he received small reimbursements for meal expenses. In the
following months his pay trended upward, but didn’t reach normal levels
until June 2012, eight months after the deductions started. But he still
wasn’t reimbursed for most of the money withheld over the previous
months.
Reuters first asked DFAS about Aiken’s case in September 2012. In
response, the agency reviewed his records and, in mid-November, sent
Reuters a summary that detailed 14 errors related to the money clawed
back from Aiken. The sums include alleged overpayments of housing and
meal allowances for soldiers living off-base, as well as wounded warrior
benefits he hadn't received, such as the tax exemption, free hospital
meals and special pay for hospitalized wounded warriors.
___________________________________________________
The summary also includes $1,291 that DFAS charged him for “delayed
notice” of his divorce, which was declared final the day he was
traveling from Chicago back to Germany. Once there, he says, he reported
the divorce, but to his old unit, not the wounded warrior transition
unit in Schweinfurt he was joining, and DFAS was never notified. Thus
the agency claimed as a debt the benefits he'd been paid as a married
soldier with children, from the date of his divorce until his arrival
several months later at Fort Bliss.
DFAS declined to provide a figure for the total amount of debt it
collected from Aiken. An analysis by Reuters of Aiken’s pay records -
including monthly pay statements obtained from DFAS under a waiver Aiken
signed - shows that from October 2011 through March 2012, DFAS withheld
more than $4,700 from his pay.
Aiken says he believes that since the pay review prompted by the Reuters
inquiries, DFAS has now fully repaid him for the debts it collected.
A Reuters examination of his records and DFAS responses to questions
suggest otherwise.
DFAS said that since October 2012, it has reimbursed Aiken $1,818.31.
That amount, plus $490.25 in meal reimbursements he received in March,
brings the total repaid to Aiken to only $2,308.55.
At least part of the shortfall is due to “partial” payments of extra pay
that wounded warriors receive, known as “Pay and Allowance
Continuation.” DFAS didn’t explain why it didn’t pay the full benefit,
nor did it list the dollar amount it approved.
DFAS’s review of Aiken’s pay history did not catch all of the mistakes.
His pay records show that DFAS double-billed him for $622.06 in alleged
meal overpayments in December and January and mistakenly deducted twice
that amount from his pay. Aiken eventually was reimbursed for the
original $622.06, but not the remainder.
Today, Aiken and Monica, who married in February last year, live in a
small stucco house, one of many like it near Fort Bliss. Their first
child, son Mason, was born last November. After two surgeries, Aiken
spends most of his days on the base, receiving treatment and counseling.
He still has nightmares, flashbacks, chronic pain and other symptoms.
(Edited by John Blanton)
Write to Scot J. Paltrow at scot.paltrow@thomsonreuters.com and Kelly
Carr at kelcarr@gmail.com.
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