--- title: "Part X, Subpart iv, Chapter 3, Section B Forfeiture of Benefits" document: "M-21-1" section: "Part X, Subpart iv, Chapter 3, Section B" canonical: "https://veteranai.co/va-regulations/m21-1/x.iv.3.b-forfeiture-of-benefits" source: "https://www.knowva.ebenefits.va.gov/system/templates/selfservice/va_ssnew/help/customer/locale/en-US/portal/554400000001018/content/554400000177994/M21-1-Part-X-Subpart-iv-Chapter-3-Section-B-Forfeiture-of-Benefits" updated: "2026-09-08T14:37:45.110304Z" --- February 27, 2023 ### X.iv.3.B.1.a. 38 U.S.C. Forfeiture Provisions [38 U.S.C. 6105]() provides for forfeiture of gratuitous Department of Veterans Affairs (VA) benefits upon conviction of “subversive activities” – offenses defined by specific statutory sections in the Uniform Code of Military Justice (UCMJ) in [10 U.S.C.](), as well as specific offenses in [18 U.S.C.](), [42 U.S.C.](), and [50 U.S.C](). When there is forfeiture under [38 U.S.C. 6105](), the person has no right (“on and after the date of commission of [the] offense”) to gratuitous benefits based on service commencing before the date of commission of the offense. [38 U.S.C. 6103]() provides for forfeiture for fraud. An individual who commits fraud in connection with any claim for benefits, subject to the applicability provisions in [38 U.S.C. 6103(d)(1)](), forfeits “all rights, claims and benefits” under laws administered by VA other than those relating to insurance. [38 U.S.C. 6104]() provides for forfeiture for mutiny, treason, sabotage or rendering assistance to an enemy of the United States or its allies, subject to the applicability provisions in [38 U.S.C. 6103(d)(1)](). When any of those offenses is shown by satisfactory evidence, the individual forfeits “all accrued or future gratuitous benefits.” **Reference:** For more information on statutory offenses constituting subversive activities, see M21-1, Part X, Subpart iv, 3.B.3.a. ### X.iv.3.B.1.b. 38 CFR Forfeiture Provisions Forfeiture is addressed in [38 CFR 3.669]() and [38 CFR 3.900 – 3.905](). [38 CFR 3.669]() provides for suspension of benefits, resumption of benefits where forfeiture is not declared, effective dates of forfeiture, and the effect of a presidential pardon. [38 CFR 3.900]() contains general principles on forfeiture, including applicability of the other forfeiture regulations. [38 CFR 3.901]() defines **_fraud_** , discusses forfeiture for fraud – before, and as of, September 2, 1959, and provides for remission of certain forfeitures imposed prior to September 2, 1959. [38 CFR 3.902]() defines **_treasonable acts_** as the offenses specified in [38 U.S.C. 6104]() (mutiny, treason, sabotage or rendering assistance to an enemy of the United States or its allies) and discusses forfeiture by reason of treasonable acts before, and as of, September 2, 1959. [38 CFR 3.903]() defines **_subversive activities_** as any offense for which punishment is prescribe in specified statutory provisions. It discusses forfeiture based on conviction of subversive activities, the effective date of the regulation, how VA is notified of a qualifying indictment or conviction, and restoration of rights to benefits with a presidential pardon. [38 CFR 3.904]() addresses forfeiture based on fraud, treasonable acts or subversive activities after the Veteran’s death. [38 CFR 3.905]() covers jurisdiction, roles, procedures, finality, due process, and offset of any remission of forfeiture. ### X.iv.3.B.1.c. Forfeiture for Subversive Activities Compared to Forfeiture for Treasonable Acts Comparing forfeiture under [38 U.S.C. 6104]() and [38 U.S.C. 6105](), the grounds for forfeiture overlap but, as discussed in M21-1, Part X, Subpart iv, 3.B.2 and 3, the evidentiary standard, and procedure, for forfeiture under each standard is different. This is because when [38 U.S.C. 6105]() (then 38 U.S.C. 3505) became law, effective September 2, 1959, it redefined the standard for forfeiture. Congress retained [38 U.S.C. 6104]() (then 38 U.S.C. 3504) but limited its applicability. Most cases of forfeiture today will fall under [38 U.S.C. 6105](). Forfeiture of benefits under [38 U.S.C. 6104]() (for what [38 CFR 3.902]() calls _treasonable acts_) can only be declared _after_ September 1, 1959, when * the individual * was** _not_** residing or domiciled in a State when the prohibited act or acts occurred, or * ceased to be a resident of or domiciled in a State before the expiration of the period during which criminal prosecution could be instituted, or * the act was committed in the Republic of the Philippines. **Notes:** * [38 CFR 3.1(i)]() defines “State” for VA purposes. * The applicability of [38 U.S.C. 6103]() to find forfeiture based on fraud was similarly limited for fraudulent acts as of September 2, 1959. **References:** For more information on the regulatory applicability of forfeiture based on * fraud and treasonable acts after September 1, 1959, see * [38 CFR 3.901(d)](), and * [38 CFR 3.902(d)](), and * subversive activities, see [38 CFR 3.903](). ### X.iv.3.B.1.d. Corporate Flash for Forfeiture Cases Always apply the corporate flash _Forfeiture Case_ as soon as VA receives * notice that a Veteran has been indicted for, or convicted of, an offense constituting a subversive activity, or * information or evidence is received indicating that a Veteran is guilty of a * a treasonable act, or * fraud. **Important:** This flash is not for use in all cases of fraud. It will only be applied when fraud is grounds for forfeiture as provided in [38 U.S.C. 6103(d)]() and [38 CFR 3.901(d)](). The corporate flash will stay in place indefinitely, unless VA subsequently receives evidence that * an indictment for a subversive activity is dropped * the Veteran is acquitted of the charges for the subversive activity * a non-forfeiture determination is made regarding * treasonable acts, or * fraud, or * the offense has been pardoned by the President of the United States. **Note:** VA should receive notice of indictment before notice of conviction of a subversive activity. However, apply the flash at the earliest point that forfeiture becomes an issue. If the first notice VA receives is of conviction then apply the flash at that time. ### X.iv.3.B.1.e. Jurisdiction Over Forfeiture Determinations The St. Paul Restricted Access Claim Center (RACC) has exclusive jurisdiction over forfeiture processing. **Important:** The Manila Regional Office has exclusive jurisdiction over certain _claims_ based on service in the Republic of the Philippines as stated in [M21-1, Part X, Subpart i, 4.A.1.a](), and [M21-1, Part II, Subpart ii, 3](), and [38 U.S.C. 6103(d)(2)](), [38 U.S.C. 6104(d)(2)](), [38 CFR 3.901(d)(3)](), and [38 CFR 3.902(d)(3)]() provide for forfeiture for fraud or treasonable acts committed in the Republic of the Philippines. However, all forfeiture referrals – even those involving foreign residency or domicile, and fraudulent or treasonable acts in the Republic of the Philippines should be worked by the St. Paul RACC. ## 2. Handling Forfeiture of Benefits for Fraud or Treasonable Acts This topic contains information on handling forfeiture of benefits for fraud or treasonable acts, including * evidence of fraud or treasonable acts precipitating the forfeiture process * process for forfeiture of benefits based on fraud or treasonable acts, and * submitting cases of forfeiture based on fraud or treasonable acts to Compensation Service or Pension and Fiduciary (P&F) Service. February 27, 2023 ### X.iv.3.B.2.a. Evidence of Fraud or Treasonable Acts Precipitating the Forfeiture Process Cases implicating forfeiture for fraud or treasonable acts could, but will not necessarily, involve a criminal indictment, or VA’s Office of General Counsel or District Counsel referral making clear that forfeiture must be considered. Claims processors must recognize fact patterns necessitating forfeiture under this topic. **Examples:** * A new claim and the evidence offered in connection with it from a person living abroad shows apparent forgery or other indications of fraud. * VA receives evidence that a Veteran subject to arrest for treason left the United States and is living in Thailand. **Important:** When evidence is received that shows forfeiture is at issue, make sure that the corporate flash _Forfeiture Case_ is applied, as provided in M21-1, Part X, Subpart iv, 3.B.1.d. The case must be routed to the St. Paul RACC for processing. ### X.iv.3.B.2.b. Process for Forfeiture of Benefits Based on Fraud or Treasonable Acts The table below describes the stages in the process for handling forfeiture of benefits when VA receives evidence of qualifying fraud or treasonable acts.| **Stage**| **Description** 1| The authorization activity suspends any current payments effective the date in the LAST PAID DATE field on the AWARD INFORMATION tab in Share in any case where there is a current award of gratuitous benefits. 2| The development activity collects, or develops for, any additional evidence needed that * the Veteran was guilty of mutiny, treason, sabotage, or rendering assistance to an enemy of the United States or one of its allies, or * the information or evidence submitted in connection with a claim is * false or fraudulent, and * material to the question of eligibility for the particular benefit. _**References**_ : For more information on * development considerations in Republic of the Philippines forfeiture cases, see [M21-1, Part X, Subpart i, 4.C](), and * fraud, see [M21-1, Part X, Subpart iv, 3.A.1.a](). 3| The development and/or authorization activity * evaluates the evidence (which includes determining its credibility), and * prepares an administrative * proposed forfeiture decision if the evidence presented indicates forfeiture, or * non-forfeiture determination if the evidence does not meet the standard for forfeiture. The decision must address the standard, as applicable, for forfeiture for * fraud in [38 U.S.C. 6103(a)]() and [38 CFR 3.901(a)](), or * treasonable acts in [38 U.S.C. 6104(a)]() and [38 CFR 3.902(a)](). **Important:** The court has held in [_Del Rosario v. Peake_](), 22 Vet. App. 399, 404 (2009), that forfeiture is supported only if the underlying conduct is shown beyond a reasonable doubt. If a proposed forfeiture decision is issued, it must include * the specific charges against the person * a detailed statement of the evidence supporting the charges, subject to regulatory limitations on disclosure of information * citation and discussion of the applicable statute(s), and * the right to * submit a statement or evidence within 60 days, either to rebut the charges or to explain the person’s position, and * a hearing within 60 days, with representation by counsel of the person’s own choosing, but that fees for representation are limited in accordance with [38 U.S.C. 5904(c)]() and that no expenses incurred by a claimant, counsel or witness will be paid by VA. 4| The development and/or authorization activity submits the proposed forfeiture decision or non-forfeiture decision to * an authorizer for concurrence, and * the Veterans Service Center Manager (VSCM) or designee for approval. 5| The VSCM or designee approves or rejects the decision. 6| The development and/or authorization activity * refers the claims folder and decision to District Counsel, and * establishes a suspense date to trigger the review of the status of the District Counsel referral. Contact [District Counsel]() if there are any questions about submission procedures. 7| District Counsel considers the claim and takes appropriate action.| If District Counsel ...| Then they will ... approves of a proposed forfeiture decision | * furnish the claimant with due process as provided in [38 CFR 3.905](), and * reassign the case to the RACC for any additional work that may be required, such as filing evidence received or scheduling a hearing during the due process period. Go to Stage 8. agrees with a non-forfeiture determination| * reassign the case to the RACC with a memorandum setting forth the basis for the decision, and * the authorization activity will provide notice to the Veteran of the non-forfeiture decision. Disregard the remaining stages in this table. disagrees with the decision made by the RACC – whether that is a * proposed decision finding forfeiture criteria are met, or * a non-forfeiture decision * reassign the case to the RACC with a memorandum setting forth the basis for the decision, and * the RACC will take corrective action. Go to Stage 3. 8| At the end of the 60-day due process period following proposed forfeiture, refer the case back to District Counsel. District Counsel must consider any additional evidence (including any hearing testimony) and argument. | If District Counsel ...| Then they will ... still recommends forfeiture| reassign the case to the RACC with a memorandum setting forth that determination.Go to Stage 9. no longer recommends forfeiture| * reassign the case to the RACC with a memorandum setting forth the basis for the decision, and * at the RACC * the development activity must prepare a non-forfeiture determination * the decision must be approved by the VSCM or designee, and * the authorization activity will provide notice to the Veteran of the non-forfeiture decision. Disregard the remaining stages in this table. 9| The development and/or authorization activity * prepares a final administrative decision finding forfeiture based on fraud or treasonable acts, and * submits the decision to * an authorizer** for concurrence, and * the VSCM or designee for approval 10| The authorization activity refers the claims folder and final decision to District Counsel to determine whether or not it will submit the case to Compensation Service or Pension and Fiduciary (P&F) Service for consideration of forfeiture. 11| District Counsel determines whether or not it will submit the case to Compensation Service or P&F Service for consideration of forfeiture. * If District Counsel decides to submit the case to Compensation Service or P&F Service, the process continues with Stage 1 of the process described in M21-1, Part X, Subpart iv, 3.B.2.c. * If District Counsel decides **_not_** to submit the case to Compensation Service or P&F Service, * it reassigns the case to the RACC with a memorandum setting forth the basis for the decision, and * the RACC will prepare and issue a non-forfeiture determination. **References:** For more information on * transferring claims folders, see [M21-1, Part II, Subpart ii, 3](), and * jurisdiction, see [38 CFR 3.905](). ### X.iv.3.B.2.c. Submitting Cases of Forfeiture Based on Fraud or Treasonable Acts to Compensation Service or P&F Service The table below describes the process for submitting cases of forfeiture of benefits based on fraud or treasonable acts to Compensation Service or P&F Service for consideration.| **Stage**| **Description** 1| District Counsel notifies the RACC that it is submitting the case to Compensation Service or P&F Service for consideration of forfeiture under the circumstances outlined in [38 CFR 3.901]() or [38 CFR 3.902](). 2| The authorization activity * checks whether suspension was already effectuated as provided in M21-1, Part X, Subpart iv, 3.B.2.b (Stage 1) and suspends any current payments effective the date in the LAST PAID DATE field on the AWARD INFORMATION tab in Share if suspension was not already effectuated * furnishes a final decision notice to the beneficiary, and * returns the claims folder to District Counsel to submit to Compensation Service or P&F Service. 3| District Counsel * prepares the submission letter to Compensation Service or P&F Service for consideration of forfeiture under the circumstances outlined in [38 CFR 3.901]() or [38 CFR 3.902](), and * notifies the RACC when the claims folder is ready for transfer to Compensation Service or P&F Service 4| The RACC notifies either Compensation Service or P&F Service by e-mail of the case that is awaiting its review. * The mailbox for Compensation Service is [VAVBAWAS/CO/214DADVISORYANDSRT](). * The mailbox for P&F Service is [VAVBAWAS/CO/Pension & Fiduciary Svc.](). **Important:** The period behind “Svc” must be included when addressing the e-mail to P&F Service.**Reference:** For more information on transferring claims folders, see [M21-1, Part II, Subpart ii, 3](). 5| The Director of Compensation Service, the Director of P&F Service, or designated staff officials within these services * determine whether or not benefits will be forfeited * notify District Counsel of the determination, and * return the case to the RACC. **Reference:** For more information on the procedure for resuming payments when Compensation Service or P&F Service does not declare forfeiture, see M21-1, Part X, Subpart iv, 3.B.4.b. ## 3. Handling Forfeiture of Benefits for Subversive Activities This topic describes the processes for handling forfeiture of benefits for subversive activities including * definition of subversive activities * VA notification of subversive activities, and * handling forfeiture of benefits based on subversive activity under 38 CFR 3.903. February 27, 2023 ### X.iv.3.B.3.a. Definition: Subversive Activities ** _Subversive activities_** means any offense for which punishment is prescribed in any of the statutory sections (including UCMJ articles) specified in [38 CFR 3.903](). **Examples:** * [18 U.S.C. 175]() defines offenses relating to biological weapons. * [18 U.S.C. 229]() defines offenses relating to chemical weapons. * [18 U.S.C. 831]() defines offenses related to nuclear material. * [18 U.S.C. 793]() defines a number of offenses that involve gathering, transmitting or losing defense information. * [18 U.S.C. 794]() defines gathering or delivery defense information to aid a foreign government. * [18 U.S.C. 2332a]() defines offenses related to use of weapons of mass destruction. * [18 U.S.C. 2332b]() defines offenses involving acts of terrorism that transcend national boundaries. * [18 U.S.C. 2381]() defines the offense of treason. * [18 U.S.C. 2383]() defines the offense of rebellion or insurrection. * [18 U.S.C. 2384]() defines the seditious conspiracy. * [18 U.S.C. 2389]() defines the offense of recruiting for service against the United States. **Important:** The offenses listed in [38 CFR 3.903(a)(2)]() are only applicable to claims filed on or after December 17, 2003. ### X.iv.3.B.3.b. VA Notification of Subversive Activities The Attorney General, Secretary of War, or Secretary of the Treasury will notify VA whenever a person is indicted or convicted of a subversive activity under any of the statutes listed in [38 CFR 3.903](). ### X.iv.3.B.3.c. Handling Forfeiture of Benefits Based on Subversive Activity Under 38 CFR 3.903 The table below describes the process handling cases involving forfeiture of benefits based on subversive activity under [38 CFR 3.903](). | **Stage**| **Description** 1| On notification of indictment under any of the statutory provisions listed in [38 CFR 3.903(a)](), the authorization activity * suspends any current payments effective the date in the LAST PAID DATE field on the AWARD INFORMATION tab in Share, and * establishes a suspense date to trigger the review of the status of criminal proceedings. 2| Upon disposition of the criminal proceedings one of the following actions occurs: * benefits are resumed as provided in M21-1, Part X, Subpart iv, 3.B.4.b if VA receives notification that criminal charges have been dropped, or * District Counsel will refer the case to Compensation Service or P&F Service for automatic forfeiture. 3| The Director of Compensation Service, the Director of P&F Service, or designated staff officials within these services, will * make the automatic forfeiture determination * notify District Counsel of the determination, and * return the case to the RACC. ## 4. Additional Matters Related to Forfeiture of Benefits This topic discusses additional matters related to forfeiture of benefits, including * entitlement to benefits based on subsequent service * resuming payments * presidential pardon petitions * processing apportionments in forfeiture cases, and * handling disagreements with forfeiture decisions. February 27, 2023 ### X.iv.3.B.4.a. Entitlement to Benefits Based on Subsequent Service Forfeiture of benefits based on one period of service _does not_ affect entitlement to benefits based on a period of service beginning **_after_** the offense causing the forfeiture. **Important:** Process a claim of this type based on the nonforfeiture period of service _only_. **Reference:** For information on forfeiture of benefits based on one period of service, see [38 CFR 3.900(a)](). ### X.iv.3.B.4.b. Resuming Payments Resume payments effective the date in the LAST PAID DATE field on the AWARD INFORMATION tab in Share under [38 CFR 3.669](), if the payment of benefits is otherwise in order and * a non-forfeiture determination was made finding no grounds for that forfeiture for fraud or treasonable acts and that was approved by District Counsel without referral to Compensation Service or P&F Service * Compensation Service or P&F Service returns the claims folder and District Counsel provides notification that no forfeiture was declared, or * District Counsel provides notification that the indictment for subversive activities was dropped or the beneficiary was acquitted of subversive activities. ### X.iv.3.B.4.c. Presidential Pardon Petitions Individuals whose benefits have been forfeited may apply through the Department of Justice for a pardon from the President of the United States. **Important:** The effective date of any resumed benefits based on a presidential pardon (after discontinuation based on forfeiture) is the date of the pardon. **Reference:** For more information on the resumption of benefits based on a presidential pardon, see * [ _Ricafort v. Nicholson_]() , 21 Vet.App. 198 (2007), and * [38 CFR 3.669(d)(1)](). ### X.iv.3.B.4.d. Processing Apportionments in Forfeiture Cases Use the table below to process apportionments when a forfeiture of benefits is invoked. | **If forfeiture was invoked …**| **Then …** ** _before_ **September 2, 1959| continue apportionments in these cases as long as the dependents remain entitled. The amount payable to the dependents is the lesser of * the applicable survivors benefit payable, which is either * Death Compensation or Dependency and Indemnity Compensation, if the Veteran was receiving compensation, or * Survivors Pension, if the Veteran was receiving non-service-connected disability pension, or * amount of compensation or pension being paid the Veteran at the time of the forfeiture. **Important:** Do **_not_** pay benefits to or for any person who participated in the fraud or treasonable act causing the forfeiture. **_after_ **September 1, 1959| do **_not_** make apportionment to any dependents. ### X.iv.3.B.4.e. Handling Disagreements With Forfeiture Decisions When a legacy notice of disagreement (NOD) or decision review request regarding a forfeiture decision is timely filed, forward the following to Compensation Service or P&F Service: * the legacy NOD or decision review request, and * any material submitted with it. Compensation Service or P&F Service will subsequently prepare a statement of the case or review decision, as appropriate. **References:** For more information on * legacy NODs, see [M21-5, Chapter 7, Section B ]() * higher-level reviews, see [M21-5, Chapter 5](), and * supplemental claims, see * [M21-1, Part II, Subpart iii, 2.B](), and * [M21-1, Part X, Subpart ii, 2.A]().