Eye Opener: Banks Hold Up Some Veterans Funds

Source: WP

Happy Wednesday! The Department of Veterans Affairs still can't seem to get ahead of some of the problems plaguing the Post 9/11 GI Bill, the program providing veterans, active-duty servicemembers and their dependents money for college tuition, textbooks and related expenses. A backlog forced the department last week to start issuing emergency checks to participants that had not yet received their first payments.

But The Eye reports in Wednesday's Federal Diary column that some banks have placed holds on the checks out of concern about potential fraud.

VA contacted some banks, university officials and program participants over the weekend when it learned of the problem, according to spokeswoman Katie Roberts. Concerned bank employees can call 1-800-827-2166 to speak with a VA employee that will confirm the check's amount and whether it was previously cashed. (Program participants should keep the number handy when they go to the bank with their checks!)

Turns out some of the checks issued by U.S. Bank on behalf of VA were handwritten in order to ensure they had enough checks to quickly distribute the funds, Roberts said. Those checks then raised concerns at some banks.

The department has distributed roughly $70 million in emergency checks since the payments started on Friday, Roberts said. Roughly 30,000 of the 64,000 students enrolled in the Post 9/11 GI Bill are still awaiting payment. The VA is authorizing payment for approximately 3,000 students per day.



Read more: http://voices.washingtonpost.com/federal-eye/2009/10/eye_opener_banks_holding_up_so.html?hpid=news-col-blog

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The little people might be committing fraud so the banksters are holding the money? What a joke!

Unless those checks are issued by the government itself (treasury checks) then the banks do not have to give immediate credit for more than something like $100.

might raise a red flag at a bank. I don't believe I've ever seen such a thing in my life. The problem here seems to be in the VA, which was not prepared properly to issue these benefit checks in a timely manner.

Can't blame the banks on this one.

I can't believe they are so pathetically manual there. The average Joe Schmoe can print their checks for goodness sakes.

These are checks issued by U.S. Bank (FOR the VA), so it appears that some of this backlog work was contracted out to some firm using U.S. Bank. to try to get $$$ out quicker to Vets and their dependents/survivors.

This is what happens when one believes the hype of having "less government" and "government off our backs". When the rubber meets the road, agencies were so starved of people and other resources to do the regular workload that they have to contract-out (which leads to higher costs and stuff like this).

Do more with less became do more with nothing. Raygunomics.