BVA9500007 
DOCKET NO.  93-05 766     )       DATE
          )
          )

On appeal from the decision of the
Department of Veterans Affairs Regional Office in Louisville,
Kentucky

THE ISSUE

Entitlement to waiver of recovery of an overpayment of improved
death pension benefits.

REPRESENTATION

Appellant represented by: Disabled American Veterans

ATTORNEY FOR THE BOARD

R. A. Caffery, Counsel

INTRODUCTION

The veteran served on active duty from August 1940 to October
1945.  He died in July 1983.  This is an appeal from a March 1992
decision by the Department of Veterans Affairs (VA) Regional
Office, Louisville, Kentucky, which denied entitlement to waiver
of recovery of an overpayment of improved death pension benefits.
It was held that there had been misrepresentation on the part of
the appellant since she did not report her income from her farm
to the VA.  The overpayment is in the amount of $11,052.

In July 1992, a tax preparer for the appellant questioned the
amount of the overpayment.  However, in May 1992 the regional
office provided the appellant with a detailed accounting of the
manner in which the overpayment was created, including her
countable income during the period in question.  It is apparent
that the tax preparer did not see that letter.  If the appellant
wishes to raise any question with regard to the calculation of
the overpayment, she should contact the regional office.

CONTENTIONS OF APPELLANT ON APPEAL

The appellant contends, in substance, that waiver of recovery of
the overpayment of improved death pension should be granted by
the VA since she had no intention to defraud the Government and
repayment of the indebtedness would cause an undue financial
hardship for her.  It is maintained that her representative was
the one who erroneously filed her income reports indicating that
she had no farm income.

DECISION OF THE BOARD

The Board, in accordance with the provisions of 38 U.S.C.A.
§ 7104 (West 1991), has reviewed and considered all of the
evidence and material of record in the veteran's claims file.
Based on its review of the relevant evidence in this matter, and
for the following reasons and bases, it is the decision of the
Board that the preponderance of the evidence does establish
misrepresentation of a material fact on the part of the appellant
in creation of the overpayment in question.

FINDINGS OF FACT

1.  All relevant evidence necessary for an equitable disposition
of the appellant's appeal has been obtained by the regional
office.

2.  The appellant was awarded improved death pension as surviving
spouse of the veteran, effective in July 1983.  Her awards had
been based on her reports that her only income consisted of
Social Security benefits.

3.  In November 1991, the appellant reported that she had had
income from her farm in 1989.  Her award was reduced, effective
in February 1989 and terminated, effective in November 1991 due
to excess income.  An overpayment of $4,595 resulted.

4.  In 1992, the appellant provided copies of her Federal income
tax returns for 1989 and 1990 reflecting her income, including
farm income to the regional office.  Based on that information,
her award of death pension was terminated, effective in February
1989 due to excess income.  The overpayment was increased to
$11,052.

5.  There was willful misrepresentation of a material fact or a
willful failure to disclose a material fact on the part of the
appellant with knowledge that such misrepresentation or failure
would result in the erroneous award or erroneous retention of VA
benefits.

CONCLUSION OF LAW

The misrepresentation on the part of the appellant in creation of
the overpayment of improved death pension benefits precludes
waiver consideration.  38 U.S.C.A. §§ 5107, 5302(c) (West 1991);
38 C.F.R. § 1.965 (1993).

REASONS AND BASES FOR FINDINGS AND CONCLUSION

The appellant's claim is "well grounded" within the meaning of
38 U.S.C.A. § 5107(a); effective on and after September 1, 1991.
That is, she has presented a claim which is plausible.  All
relevant facts have been properly developed with regard to
whether there was misrepresentation on the part of the appellant
in creation of the overpayment in question.

The record reflects that the appellant was awarded improved death
pension benefits as surviving spouse of the veteran, effective in
July 1983.  The amount of her pension was based on her reports
that her only income consisted of her Social Security benefits.

The record further discloses that, in late 1991, the appellant
advised the regional office that she had had income from a farm
in 1989.  Her award of improved death pension was reduced,
effective in February 1989 and terminated, effective in November
1991 due to excess income.  An overpayment of $4,595 resulted.

In 1992 the appellant provided copies of her Federal income tax
returns for 1989 and 1990 to the regional office reflecting her
income including income from her farm and interest of about $800
for each of those years.  On the basis of that information, the
regional office terminated her award of improved death pension,
effective in February 1989 due to excess income.  The regional
office has assumed that her farm and interest income continued in
1991.  The overpayment was increased to $11,052.  The regional
office has not questioned her income prior to 1989 and the
overpayment in issue is limited to the period from February 1989
to November 1991.

The regional office has determined that there was
misrepresentation on the part of the appellant in creation of the
overpayment.  Accordingly, her request for waiver of recovery of
the indebtedness was denied.

The law precludes waiver of recovery of an overpayment or waiver
of collection of any indebtedness where there exists, in
connection with the claim for such waiver, an indication of
fraud, misrepresentation or bad faith on the part of the
claimant.  38 U.S.C.A. § 5302(c).

As used in 38 U.S.C.A. §§ 110 and 1159 and implementing
regulations, fraud means an intentional misrepresentation of fact
or the intentional failure to disclose pertinent facts, for the
purpose of obtaining or retaining eligibility for VA benefits
with knowledge that the misrepresentation or failure to disclose
may result in the erroneous award or retention of such benefits.
38 C.F.R. § 3.1(aa).  Fraud and misrepresentation both contain
common characteristics and are considered as a single element.
The burden of proof to establish fraud or misrepresentation lies
solely with the VA.

In this particular case, the evidence discloses that the
appellant had been notified on a number of occasions that the
rate of death pension paid depended, in part, upon the amount of
her income and she had been asked to immediately report any
changes in income to the VA.  She had also been informed on
various occasions that her awards had been based solely on the
Social Security benefits as reported by her.  Although the
appellant received net farm income after expenses of $5,388 in
1989 and $5,404 in 1990, she did not report any farm income to
the VA until late 1991.  The eligibility verification reports
submitted by her in May 1989, April 1990, and March 1991
specifically stated that, although she owned a farm, she had no
income therefrom.  She also indicated that she had no interest
income.  Interest income of about $800 was reported on her tax
returns, although the appellant has repeatedly denied having any
net worth, other than her farm.  Clearly, her income information
was incorrect and led to the overpayment in question.

The appellant has maintained, however, that she had no intention
to defraud the Government and that her representative from the
Disabled American Veterans (DAV) was the one who completed the
erroneous income reports.  She has indicated that she was
depending on her representative to take care of her claim and her
representative was fully aware of her financial situation.  She
has indicated that she depended on him to take care of her claim
accordingly.  She has stated that her representative led her to
believe that she only had to ensure that her Social Security
benefits did not exceed $350 per month.  The contentions of the
appellant have not been substantiated.  However, even if her
contentions are correct, the appellant's representative is her
agent and the misrepresentation by her representative would be
inputed to her.  Further, the appellant signed the income reports
and is therefore responsible for the contents thereof.  Under the
circumstances, the Board finds that there was a willful
misrepresentation of a material fact or the willful failure to
disclose a material fact that was done with the appellant's
knowledge that such misrepresentation or failure would result in
the erroneous award or erroneous retention of VA benefits.
Accordingly, the Board concludes that there was misrepresentation
on the part of the appellant in creation of the overpayment in
this case.  Her request for waiver of recovery of the
indebtedness is, therefore, barred on that basis.  38 U.S.C.A.
§ 5302(c); 38 C.F.R. § 3.1(aa).  In arriving at its decision in
this regard, the Board has carefully reviewed the entire record
but does not find the evidence to be so evenly balanced that
there is doubt as to any material issue.  38 U.S.C.A. § 5107.

ORDER

Entitlement to waiver of recovery of an overpayment of improved
death pension benefits is precluded by reason of
misrepresentation on the part of the appellant.  The appeal is
denied.

          ROBERT D. PHILIPP
          Member, Board of Veterans' Appeals

The Board of Veterans' Appeals Administrative Procedures
Improvement Act, Pub. L. No. 103-271, § 6, 108 Stat. 740, ___
(1994), permits a proceeding instituted before the Board to be
assigned to an individual member of the Board for a
determination.  This proceeding has been assigned to an
individual member of the Board.

Under 38 U.S.C.A. § 7252 (West 1991), only a decision of the
Board of Veterans' Appeals is appealable to the United States
Court of Veterans Appeals.  This remand is in the nature of a
preliminary order and does not constitute a decision of the Board
on the merits of your appeal.  38 C.F.R. § 20.1100(b) (1993).
The remand portion of this decision is in the nature of a
preliminary order and does not constitute a decision of the Board
on the merits of your appeal to the extent indicated.  38 C.F.R.
§ 20.1100(b) (1993).