BAH Fraud – OHA Fraud – Travel Voucher Fraud
BAH Fraud and OHA Fraud – Tried as Larceny Charges
Considering the ballooning U.S. Budget deficit and the proposed cut-backs in military funding, all branches of the Armed Forces are cracking down on Basic Allowance for Housing (BAH) Overseas Housing Allowance (OHA), and Travel Voucher Fraud and abuse. Using targeted investigations and random audits, various command auditors are focusing on servicemembers who can be profiled by living arrangements that fit typical, similar cases of soldiers taking advantage of free-flowing sources of additional cash.
Facing allegations of BAH Fraud or OHA Fraud?
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How are Audits Targeted – What do Auditors Look For?
Audits are both random and targeted. Servicemembers, or their families who are living in high-cost locations are particularly at risk for an audit. Servicemember families who moved from their initial location when entering the armed forces to a high-cost location thereafter, are also at greater risk. Government computers easily generate such lists for random and targeted audits. Auditing of servicemember’s allowances is most often accomplished by comparing their LES (Leave & Earnings Statements) against other military and civilian financial documents. If a preliminary “fishing net audit” uncovers irregularities or raises further questions, the auditors dig deeper and will review anything ever submitted to your base’s finance office or to DFAS (Defense Finance and Accounting Services). All of a servicemembers documents and financial dealing are subject to their forensic audit including, but not limited to:
- Bank account transactions
- Bank statements
- Rental and lease agreements
- Records of moving expenses
- Marriage licenses (and divorce filings)
- Birth certificates (number of children)
- Dependents school enrollment records
BAH Fraud and OHA Fraud is not just a simple matter of taking advantage of over-payment, it is considered serious and actionable Larceny. It is analogous to knowingly submitting a falsified check to a bank and pocketing money that is not yours. Larceny charges are very serious and it would be in your best interest to seek immediate legal advice if you are being investigated for any fraud abuse, filing a False Official Statement, or Larceny.
Larceny punishments are serious and significant – Larceny carries a maximum punishment of 10-years in prison and a dishonorable discharge under the Uniform Code of Military Justice (UCMJ). A BAH Fraud or OHA Fraud conviction may also include confinement, a reduction in rank and forfeiture of pay.
Why is BAH Fraud and OHA Fraud so Prevalent?
BAH housing allowance rates are set by location, pay grade and ones dependency claims. For example, an E-9 claiming his or her family resides in San Francisco, CA is entitled to $3,618 per month (a whopping $43,416 per year) which doesn’t have to legally go to “housing”, but if the family actually lives off-base nearby to Fort McClellan is Anniston, AL, the real BAH housing allowance the servicemember is legally-entitled is only $1,170 per month according to the Military’s 2014 BAH rates. That solider could be charged with Larceny by defrauding the US Taxpayers of $2,246 each and every month or a annual fraudulent theft of nearly $30,000 of personal enrichment. Many servicemembers use a friend or relatives address in a higher paying state to work the system to their unlawful benefit.
Examples of Basic Allowance for Housing (BAH)/Overseas Housing Allowance (OHA) and Travel Voucher Fraud
BAH, OHA, and Travel Voucher fraud prosecutions uncover recurring, similar patterns, such as, but certainly not limited to:
- Bogus rental agreements
- False home of record information
- Family living in low-cost area – but claiming high-cost address
- Fake marriages / Falsified marriage documents
- Divorces never reported to base finance office and/or DFAS
- False claim of having dependents
- Claiming elevated numbers of dependents
- False travel claims
- Inflated number of trips
- Mileages inflated / Trip distances exaggerated
- False requests for reimbursement
OHA Example – Claiming a spouse w/dependents at overseas posting
Here’s an illustrative example — contrived, but all-too-possible:
A US servicemember falsifies his residence location and arranged a sham marriage to purposefully defraud the government of BAH entitlements. Many real OHA frauds involve marrying foreign nationals while on deployment and working every-possible angle for maximum enrichment. By marrying a U.S. servicemember, the foreign national will then qualify to apply for U.S. citizenship and receive a military dependent identification card. A servicemember who claims that their foreign spouse lives in a higher cost foreign country (or the U.S.) qualifies for a higher amount of housing allowance.
In the Philippines, an E-7 claiming dependents can get $2,877 per month in OHA payments plus $879 for Utility and Maintenance Allowance according to the Overseas OHA calculator totaling $3,756 ($45,000 per year) from U.S. Taxpayers. According to international income statistics, consider that the average annual salary for workers in the Philippines is a meager $4,000 per year. An armed forces member, with a sham family claiming local housing arrangements, could easily pocket a significant windfall through Larcenous actions.
Measurable upswing in BAH Fraud and OHA Fraud in recent years
Statistics indicate that there has been a substantial increase in BAH fraud and OHA fraud cases. The majority of these recorded cases involve amounts stolen ranging from $15,000 to $60,000. The armed forces offenders are equally represented from both enlisted and officer ranks.
BAH Fraud and OHA Fraud are prosecuted under False Official Statements and Larceny statues.
In order to be convicted, the government must prove that the servicemember completed the necessary allowance claim forms with the “intent to deceive.” In short, it is not sufficient for the government to simply show that the servicemember completed the form(s) incorrectly, but that the servicemember filled out evidentiary documents with the intent to deceive.
Moreover, to be found guilty of the crime of Larceny, the government must prove that the servicemember received money that he or she knew they were not entitled to receive yet consciously chose to keep that money with the intent of never returning it.