ROK Drop

Avatar of GI KoreaBy on January 6th, 2009 at 7:44 am

The US Military and Housing Fraud

Considering we have been discussing the LQA issue and housing fraud going on in USFK from yesterday’s posting here on the ROK Drop, the Stars & Stripes provides a timely article about housing fraud in general going on in the Army:

Brian Martin knew he was getting too much money, the sailor told the court.

After renting an apartment on the economy in Japan, a space opened up at Yokosuka Naval Base so the petty officer first class moved his family there. But Martin’s Overseas Housing Allowance, or OHA, kept rolling in.

“It wouldn’t shut off,” Martin said of the $69,000 he collected in fraudulent housing allowance.

Though Martin said he tried to cut off the wrongful OHA, he eventually stopped trying to correct the mistake. And he sealed his fate by signing off on the payments on his “page two” personnel form.

“I really didn’t think about what I was doing at the time,” Martin testified in September at his special court-martial. “I knew that someone was going to catch it and that I’d have to repay it.”

But it’s not just a matter of paying the money back, military authorities say. This misperception can have disastrous effects because housing fraud comes at a much higher price.

“In a legal sense, OHA fraud is larceny, not just an overpayment. It is akin to knowingly submitting a fake check to a bank and taking money that is not yours,” said Lt. Mario Correa, a defense attorney who worked with cases at Yokosuka. “Many of these people have a lot to lose.”

Larceny carries a maximum punishment of 10 years in prison and a dishonorable discharge under the Uniform Code of Military Justice. A housing fraud conviction may also include confinement, a reduction in rank to E-1 and forfeiture of pay.  [Stars & Stripes]

The rest of the article explains the differences between BAH and OHA for those of you not familiar with it.  The article also talks about housing fraud in each of the services.  The Air Force claims housing fraud is dropping, but unsurprisingly Kunsan Airbase was the high point of housing fraud with 15 cases in the past three years.  The Navy and the Marine Corps have seen a rise in investigations of housing fraud, while the Army said they are closely monitoring data.  However, no one in the Army would comment about housing fraud in the Pacific area of operations.  I have all the court martial results saved in my archives so maybe sometime I will go through them and total up the housing fraud cases in Korea since the Army seems reluctant to do so.

The last time I moved to Korea Army Finance was continuing to pay my BAH rate from back in the US instead of the rate for Uijongbu.  I go to finance and fill out all the paperwork and was told my next LES would have the proper housing rate.  Well the next month it still had the wrong BAH rate.  So this time I went to finance showed them my LES and once again filled out paperwork but this time I had the NCO in charge sign a memorandum for me saying that I had been to their office and notified them of the mistake which they said they would correct.  I then went over to the Camp Stanley legal office and talked to a JAG there to cover myself further, simply because I did not want to be accused of housing fraud.

It ended up taking finance four months to fix my BAH rate, but my commander was informed, JAG was informed, and I had multiple signed memorandums every month from finance just to cover myself if some CID investigator looking at BAH fraud tried to accuse me of something.  When it was all said and done, finance actually let me keep the difference in the money which was nice, but I would have rather they fixed the problem in the first place so I would not had to deal with all the leg work to ensure I wasn’t accused of BAH fraud.

So often times I wonder how many people have been in my situation, but instead of following through to get it fixed after months of trying, they just say forget about it, because if the Army isn’t concerned about fixing the problem then why should I?  So this causes a servicemembers who if the military fixed the problem in the first place would not have gotten in trouble.  So while the military is going after servicemembers in situations like this, the massive housing fraud in Korea involving entities like Julie’s Realty continues to go on.

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  • Bob Walsh
    3:25 am on January 6th, 2009 1

    I think you did the right thing by covering yourself in paper on this.

    But I have seen these cases go either way. Back in the 80's, a friend continued to collect after he moved into housing at Hannam. He went to finance twice, but nothing happened. He sort of figured that eventually the Army would find the mistake and collect it all back. $18,000 later, the Army did, and court martialed him, and he was busted from E7 to E6. 3 years later, the case was overturned on appeal, and he got his rank and back-pay.

    And I've seen several cases where guys got divorced, continued to collect HA at the married rate, and when found out were not busted at all, just had several years of "NPD" LES's.

  • hardyandtiny
    6:58 pm on January 19th, 2009 2

    All Julie has to do is get a silent kick back from the landlord. As long as the USFK pays LQA they'll get ripped off.

  • Avatar of GI KoreaGI Korea
    12:27 am on January 20th, 2009 3

    A program needs to be instituted where if any unused housing money is left over, the individual would pocket half the difference and the government would keep the other half. This would encourage servicemembers to look around for an apartment instead of settling for ones where the owners make you pay your full LAQ price.

    However, if USFK had realtors working for them that weren't encouraging housing fraud like Julie's then this wouldn't be an issue.

  • LilOl'Me
    12:19 pm on October 7th, 2009 4

    People get of was with this in Korea all the time E-6 Flakes did.

  • guitard
    3:34 pm on October 7th, 2009 5

    Maybe it's just me…but I can't make any sense whatsoever of what you have written here…


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