Army Quick to Make Troops Pay for Bad Bookkeeping, Soldiers Say

California National Guard Staff Sgt. Tony Priestley is about to retire from an Army career that has spanned nearly three decades.

After three tours in Iraq and 29 years of service, both active and Guard, the Army wants him to pay back a $14,000 re-enlistment bonus he received 10 years ago.

The war in Iraq was raging in March 2006, and the Guard needed soldiers. So Priestley extended his career, which began in 1987, for another six years and collected his first incentive bonus.

"I had just come back from my second tour in Iraq. ... If I wasn't able to receive a bonus, I still would have done an extension, Priestley said. "I always wanted to be a soldier my whole life."

A decade later, the California National Guard notified Priestley that he had violated the terms of his bonus by going on Active Guard Reserve status in August 2006.

"There was not a six-month break between March and August," Priestley said. "By regulation, it's a violation. Nobody caught it in 2006. When I read it now -- the addendum to the attachment of the extension -- it says that pretty clearly.

"When I signed ... I guess maybe I was excited it was the first time I received a bonus. ... All I can say is that now that I know, by all rights I'm wrong, but I mean, Jesus Christ, to find out 10 years later ... I didn't maliciously do it. It was just an error."

Priestley is one of about 10,500 service members, mostly from the California National Guard, who improperly received bonuses of as much as $15,000 and other incentives to serve in the ranks a decade ago during the peak of the U.S.-led wars in Iraq and Afghanistan.

Thousands of troops have been ordered to pay back the money or face such penalties as interest charges and tax liens.

The White House has ordered a review of the matter, and Defense Secretary Ashton Carter directed the Defense Department to suspend the collection of bonuses.

A Widespread Problem

But as the story spreads, it seems the Pentagon's practice of ordering service members to repay money it mistakenly doled out years ago stretches far beyond the California National Guard.

Retired Chief Warrant Officer 2 Tim Merlino has been fighting an order to repay $5,000 to the Connecticut National Guard for six years.

In 2007, Merlino left his enlisted rank of specialist and went through the Army's warrant officer accessions program to become a UH-60 Black Hawk pilot.

When he heard he was eligible for a $10,000 accessions bonus, he filled out the paperwork before leaving for his basic course at Fort Rucker, Alabama. The incentive manager checked his paperwork and said, "Yep. Everything looks great," Merlino recalled.

Merlino received half of the bonus in 2009. When he inquired about the second half of the bonus several months later, "I was told I should not have received the first half due to a clerical error on the part of the incentive manager in the CT Guard," he said.

Merlino appealed the decision through the National Guard Bureau.

"Upon their review, I was told I should never have received a bonus in the first place," he said.

The accessions bonus Merlino received was only for certain, critical skills needed by the Connecticut Guard at that time, he said.

"Apparently there is some list out there ... 153D Blackhawk pilot was not on the critical list," Merlino said. "The average solder does not see these lists; it's not something that is posted on Google."

Merlino said he has been ordered to pay back $5,000, even though he received only $3,800 after taxes. He currently pays $169 per month to repay the debt.

Merlino said he empathizes with "these poor guys have to cash out their retirements to pay that debt out," referring to the California Guardsmen who have to repay much larger bonuses.

The Army "doesn't really care what your situation is," said Merlino, a 36-year-old husband and father of two young girls. "The impact a debt repayment has on a single family income is great, and there is no accountability for all the errors made on numerous levels. The burden is solely passed on to the individual soldier for not knowing the full-time soldier's job as the incentive manager."

Accidental Double-Dipping

The Ohio National Guard recently ordered retired Sgt. 1st Class Joseph Sowers to repay $22,800 in disability benefits by Nov. 1.

Sowers, 36, spent 10 years of his 16 years of service with the 19th Special Forces Group. He was medically retired with back injuries and post-traumatic stress disorder in 2015.

Sowers said he didn't know anything was wrong when he began receiving 60 percent disability benefits from the Department of Veterans Affairs and 40 percent from the Ohio State National Guard.

He learned in a Sept. 15 letter from the Guard that he could not receive disability benefits from both the Ohio Guard and the VA.

"The way the policy is written, if one is more than the other, you only get the larger one; you can't get both," Sowers said. "When I out-processed, I was never told that I could not receive both VA and DoD retirement."

Sowers said he thought the VA and Guard were supposed to stay in contact with each other to avoid these types of mistakes.

Threatening to charge 15 percent interest if it's not paid back by Nov. 1 is also unnecessary, said Sowers, who plans to apply for a waiver.

"I find this situation hard to believe, but I understand completely because it happens all the time," he said. "When they owe you money, they take their time. When they want your money, they want it now or you will pay the consequences."

No Quick Fix

As for Priestley and other California Guard members, Pentagon and Guard officials have said there is no quick fix to the problem because current laws and regulations don't authorize them to grant a blanket waiver.

A team led by Peter Levine, Carter's senior personnel official, will create a new process by Jan. 1 "that ensures the fair and equitable treatment of our service members and the rapid resolution of these cases," with the goal of concluding the work by July 1.

Priestley filed an appeal against the bonus recoup order in late September, but hasn't received a response yet.

"It's horrible, said Priestley, 48 and a father of five. "I can't see how a decade can go by and these people get blindsided with these notifications. I feel bad for these people that have already paid it back. They've had to refinance their homes. I can't afford to pay $14,000 back.

"I don't know what will come of this for us all. I mean, I hope that it does get waived for everybody, but it is something else. And it is too much to ask people to do after they have given their time."

-- Brendan McGarry contributed to this story.

-- Matthew Cox can be reached at matthew.cox@military.com.

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