BVA9508146 
DOCKET NO.  93-09 056     )       DATE
          )
          )

On appeal from the decision of the
Department of Veterans Affairs Regional Office in Portland,
Oregon

THE ISSUE

Entitlement to waiver of recovery of an overpayment of disability
compensation benefits.

(The issues of entitlement to service connection for defective
hearing in the left ear, a skin disability, including chloracne,
and an increased evaluation for post-traumatic stress disorder,
currently evaluated as 50 percent disabling, are the subjects of
a separate decision.)

REPRESENTATION

Appellant represented by: Oregon Department of Veterans'
Affairs

ATTORNEY FOR THE BOARD

R. A. Caffery, Counsel

INTRODUCTION

The veteran served on active duty from May 1966 to May 1968.
This is an appeal from an August 1990 decision by the Department
of Veterans Affairs (VA) Regional Office, Portland, Oregon,
denying entitlement to waiver of recovery of an overpayment of
disability compensation benefits.  The overpayment is in the
amount of $1,037.40.

REMAND

The record reflects that the veteran has established service
connection for various conditions, including post-traumatic
stress disorder, evaluated as 50 percent disabling.

The record further discloses that in April 1989 the veteran's
award of disability compensation was reduced, effective
January 2, 1989, to the 10 percent rate ($73 per month) since he
was incarcerated for commission of a felony.

The record further discloses that in June 1989 the remaining
amount of the veteran's disability compensation, $353 per month,
was apportioned to his spouse for his child [redacted], effective
January 2, 1989.

Later in June 1989 the veteran's award of disability compensation
was resumed at the full rate ($426 per month), effective June 7,
1989, since he had been released from incarceration.

In October 1989 the apportionment for his child [redacted] was
terminated, effective November 1, 1989.  In June 1990 the
apportionment was terminated effective the date of the veteran's
release from incarceration, June 7, 1989.  The overpayment in
question resulted from this action.

In its August 1990 decision, the regional office held that the
veteran had been at fault in creation of the indebtedness since
he had knowledge that checks were being issued erroneously for
the apportionment award after his release from incarceration and
he failed to inform the VA of the error.  It was further
indicated that collection of the indebtedness would not create an
undue financial hardship for the veteran.

The veteran has maintained that he was under the impression that
the VA disability compensation checks that he received after his
release from incarceration represented sums that the veteran had
been due for the time he was incarcerated.  He further maintained
that he had not been able to hold a job since he returned from
Vietnam and his only income was his VA disability compensation.
He asserted that repayment of the indebtedness would create a
severe financial hardship for himself, his wife and children.

The Board notes that the financial status report submitted by the
veteran reflecting some $500 income per month from his VA
disability compensation and monthly expenses of about $560 was
completed in July 1990.  The Board believes that an up-to-date
financial status report would be in order.

In view of the aforementioned matters, findings of fact and
conclusions of law are being deferred pending a REMAND for the
following action:

1.  The veteran should be contacted and
asked to provide a current Financial Status
Report (VA Form 4-5655) reflecting his
current family income from all sources,
monthly expenses and assets.  That
information should be associated with the
claims file.

2.  The veteran's case should then be
reviewed by the regional office.  If the
denial is continued, the veteran and his
representative should be sent a
supplemental statement of the case and be
afforded the appropriate time in which to
respond.

When the above action has been completed, the case should be
returned to the Board for further appellate consideration, if
otherwise in order.  No action is required of the veteran until
he receives further notice.

The purpose of this REMAND is to obtain clarifying information.
The Board intimates no opinion as to the disposition warranted in
this case pending completion of the requested action.

          WAYNE M. BRAEUER
          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) (1994).