Part X, Subpart i, Chapter 3, Section BAdjudication Procedures for Foreign Claims

Revised April 9, 2020

X.i.3.B.1.a#Prohibition on the Release of Payments

31 U.S.C. 3329 prohibits the release of payments to persons who live in a foreign country if the Secretary of the Treasury decides that local conditions in the foreign country do not reasonably ensure that the payee will

• receive the payment, or
• be able to negotiate a payment for full value.

The Department of Treasury maintains a list of the foreign countries where the conditions described in the preceding paragraph exist. Currently, the list consists of only two countries, which will hereafter be referred to as “listed countries”:

• Democratic People’s Republic of Korea (North Korea), and
• Republic of Cuba.

Exception: 38 CFR 3.653(c)(1) allows for the payment of benefits to an individual residing in a listed country as long as the individual, on his/her own initiative,

• requests that benefit payments show a U.S. Foreign Service post address in a country that is not on the list referenced in the preceding paragraph
• specifies the U.S. Foreign Service post address to which the payments are to be forwarded, and
• indicates he/she will take delivery at that U.S. Foreign Service post in person.

Reference: For more information about the principle discussed in this block, see 31 CFR 211.1.

X.i.3.B.1.b#Apportioning the Benefits of a Beneficiary That Resides in a Listed Country

The Department of Veterans Affairs (VA) may apportion the benefits of a beneficiary that resides in a listed country. This differs from the payment of benefits to dependents under the provisions of 38 CFR 3.653(a), which is discussed in M21-1, Part X, Subpart i, 3.B.5.b. Important: Restrictions on the development and processing of claims set forth in 38 CFR 3.653(c) (and discussed in M21-1, Part X, Subpart i, 3.B.2.a) apply equally to claims for an apportionment if the claimant

• resides in a listed country, and
• is not a U.S. citizen.

After deciding to apportion the benefits of a beneficiary that resides in a listed country, claims processors must establish a system diary that will expire one year later (and every year thereafter), at which time they must confirm the continued existence of the primary beneficiary. Claims processors must follow the steps in the table below if they are ever unable to confirm the continued existence of the primary beneficiary referenced in the preceding paragraph.

References: For more information about

• processing claims for an apportionment, see M21-1, Part VII, Subpart iii, 1.A, and

• establishing a system diary, see the Veterans Benefits Management System (VBMS) Awards User Guide.

X.i.3.B.1.c#Sending Correspondence to Claimants That Reside in a Listed Country

Although sending payments to listed countries is prohibited, correspondence may be sent to claimants living in these countries; however, it is unlikely they will receive it. In correspondence outside VA, do not use the term “blocked countries.” Instead, use “listed countries.”

X.i.3.B.1.d#Special Account Called Secretary of the Treasury, Proceeds of Withheld Foreign Checks

31 U.S.C. 3329(b)(4) provides for a special account called Secretary of the Treasury, Proceeds of Withheld Foreign Checks , which was established to preserve the rights of

• persons to whom awards had been made before October 9, 1940 (when the law prohibiting payments to listed countries was enacted), and
• those subsequently taking residence in a listed country.

2Development and Authorization of Claims by Individuals in Listed Foreign Countries

This topic contains information on developing claims filed by and authorizing awards to individuals that reside in a listed country, including

• deciding whether to develop claims and authorize awards, and
• circumstances under which it is appropriate to deny claims without undertaking development.

Revised April 9, 2020

X.i.3.B.2.a#Deciding Whether to Develop Claims and Authorize Awards

If a claimant that is not a U.S. citizen resides in a listed country, do not undertake development on an initial or supplemental claim or authorize a corresponding award to the claimant unless the claimant, on his/her own initiative,

• requests that benefit payments show a U.S. Foreign Service post address in a country that is not on the list referenced in M21-1, Part X, Subpart i, 3.B.1.a
• specifies the U.S. Foreign Service post address to which the payments are to be forwarded, and
• indicates that he/she will take delivery at that U.S. Foreign Service post in person.

Note: Limit claims development in countries without Department of State offices (such as North Korea) to direct correspondence with the claimant. Reference: For information about the circumstances under which a U.S. citizen loses his/her citizenship, see 8 U.S.C 1481.

X.i.3.B.2.b#Circumstances Under Which it Is Appropriate to Deny Claims Without Undertaking Development

38 CFR 3.653(c) allows claims processors to deny – without undertaking development – initial and supplemental claims filed by claimants that are not U.S. citizens and reside in a listed country when

• the claimant fails to request delivery of payments to a U.S. Foreign Service post address in a country that is not on the list referenced in M21-1, Part X, Subpart i, 3.B.1.a, and/or
• full development of the case requires the services of the Department of State.

3Discontinuing Awards to Beneficiaries in Listed Foreign Countries

This topic contains information on discontinuing awards to beneficiaries that reside in a listed country, including

• notification by the Department of Treasury
• handling adjustments for returned payments, and
• adjusting
  • the rate payable to other individuals when the primary beneficiary’s award is discontinued, and
  • a beneficiary’s award when his/her dependent resides in a listed country.

Revised April 9, 2020

X.i.3.B.3.a#Notification by the Department of Treasury

The Department of Treasury returns payments for pension, compensation, or Dependency and Indemnity Compensation (DIC) to VA for cancellation when a beneficiary resides in one of the listed countries referenced in M21-1, Part X, Subpart i, 3.B.1.a. VA Form 20-6560 , Notice of Benefit Payment Transaction, is received in each case under message code 611, CHECK RETURNED – DEATH OF PERS ENT.

X.i.3.B.3.b#Handling Adjustments for Returned Payments

If the returned payment is a regular monthly payment and

• does not include adjustments for periods prior to the month for which it was issued, discontinue the award effective the date in the LAST PAID DATE field on the AWARD INFORMATION tab in Share, or
• includes adjustment payments for periods prior to the month of issuance, adjust/reduce and discontinue the award so as to cancel the retroactive adjustment.

X.i.3.B.3.c#Adjusting the Rate Payable to Other Individuals When the Primary Beneficiary’s Award Is Discontinued

If discontinuation of an award to a primary beneficiary that is residing in a listed country affects the rate payable to another person, such as a dependent or an apportionee,

• adjust the award(s) of the other person(s) under end product 130 as if the primary beneficiary were deceased, effective the date in the LAST PAID DATE field on the AWARD INFORMATION tab in Share for the discontinued award, and
• annotate the award(s) with Payee residing in a listed country.

Note: If the award adjustment described in this block is made in VBMS, enter the annotation referenced in the preceding bullet as text in the OTHER PRINT REMARKS field on the PRINT REMARKS screen.

X.i.3.B.3.d#Adjusting a Beneficiary’s Award When His/Her Dependent Resides in a Listed Country

If a beneficiary residing in a country that is not on the list referenced in M21-1, Part X, Subpart i, 3.B.1.a, is receiving additional compensation, pension, or increased pension because of a dependent who is or becomes a resident of a listed country, remove the dependent from the beneficiary’s award effective the date in the LAST PAID DATE field on the AWARD INFORMATION tab in Share. Note: Provide the beneficiary a notice of proposed adverse action before removing the dependent unless the beneficiary notified VA that his/her dependent resides in a listed country.

4Releasing Withheld Funds and Resuming Awards for Beneficiaries in Listed Foreign Countries

This topic contains information on releasing withheld funds and resuming a discontinued award of a beneficiary that resides or resided in a listed country, including

• requirements for releasing withheld funds and resuming discontinued awards
• releasing withheld funds
• resuming
  • a discontinued award, and
  • an award when the existence of the beneficiary could not be established
• developing for eligibility
• actions to release withheld funds, and
• deceased beneficiaries.

Revised April 9, 2020

X.i.3.B.4.a#Requirements for Releasing Withheld Funds and Resuming Discontinued Awards

Release withheld funds or resume a discontinued award if

• the country in which the beneficiary resides is removed from the list referenced in M21-1, Part X, Subpart i, 3.B.1.a
• the beneficiary establishes residence in a country that is not on the referenced list, or
• the beneficiary has requested award payments be mailed to him/her in care of a U.S. Foreign Service post in a country that is not on the referenced list.

References: For more information on

• the release of frozen funds, see 38 CFR 3.653, and
• providing awards to residents in listed countries using a U.S. Foreign Service post, see M21-1, Part X, Subpart i, 3.B.4.b.

X.i.3.B.4.b#Releasing Withheld Funds

Release pension and compensation payments formerly deposited in the special account referenced in M21-1, Part X, Subpart i, 3.B.1.d

• when identified as such in the claims folder
• on receipt of a claim, and
• on the furnishing of a loyalty clearance, if required by M21-1, Part X, Subpart i, 3.B.6.

Notes:

• Payment will be made from the Compensation and Pension appropriation, 36XO102.
• There is no time limit for the filing of a claim by the Veteran or dependent beneficiary. However, evidence of continued entitlement must be submitted within one year from the date of request.

Reference: For more information on the payment of withheld funds as accrued benefits, see M21-1, Part XI, Subpart ii, 3.E.11.

X.i.3.B.4.c#Resuming a Discontinued Award

If an award was discontinued for the reason(s) VA prevented from obtaining necessary evidence or Payee residing in a listed country , pay the amount otherwise payable to the beneficiary effective the date of discontinuance. Notes:

• Payment is subject to proof of entitlement over the intervening period.
• There is no time limit for the filing of a claim by the Veteran or dependent beneficiary. However, evidence of continued entitlement must be submitted within one year from the date of request.

References: For more information on

• retroactive payments, see 38 CFR 3.653(c)(3), and
• developing for eligibility for the resumed award, see M21-1, Part X, Subpart i, 3.B.4.e.

X.i.3.B.4.d#Resuming an Award When the Existence of the Beneficiary Could Not be Established

If payments were not made solely because the continued existence of the beneficiary was not established, apply 38 CFR 3.158(c), concerning whereabouts previously unknown. The effective date of a resumed award under 38 CFR 3.158(c) is governed by 38 CFR 3.114(a). However, the effective date cannot be prior to December 1, 1962.

X.i.3.B.4.e#Developing for Eligibility

Develop the claim to determine the beneficiary’s eligibility, including proof of identity, when releasing withheld funds or resuming a discontinued award. Development includes

• obtaining a loyalty clearance if required by M21-1, Part X, Subpart i, 3.B.6, and
• notifying the beneficiary of his/her right to elect the following:
  • Veterans Pension in Section 306 and Old-Law and Survivors Pension cases, or
  • DIC in death compensation cases.

Reinstate the benefit when development indicates that eligibility may be reestablished. Note: Proof of identity must be acceptable to the Department of State authorities in the country removed from the list referenced in M21-1, Part X, Subpart i, 3.B.1.a.

X.i.3.B.4.f#Actions to Release Withheld Funds

To release withheld funds, prepare

• a one-time payment to release funds for the retroactive part of the award, and
• a second award processed in the normal manner to resume payments from the final date through which payment was withheld.

X.i.3.B.4.g#Deceased Beneficiaries

In some situations, information in the claims folder indicates

• the beneficiary is deceased, and
• a claim for accrued benefits has not been filed within one year after the reported date of death.

In this situation, notify the finance activity stating that the amount withheld is not payable to any living person.

5Awards to Individuals That Reside in Enemy Territory

This topic contains information on awards to individuals that reside in enemy territory, including

• requirement to discontinue a beneficiary’s award
• paying benefits to the dependent(s) of a beneficiary whose award VA discontinued under the provisions of 38 CFR 3.653(a), and
• actions former beneficiaries must take before VA will reconsider awarding benefits.

Revised April 9, 2020

X.i.3.B.5.a#Requirement to Discontinue a Beneficiary’s Award

38 CFR 3.653(a) requires VA to discontinue a beneficiary’s award if the beneficiary

• is not a U.S. citizen, and
• resides in the territory of (or under the control of) an enemy of the U.S. or its allies.

Discontinue the award effective the date in the LAST PAID DATE field on the AWARD INFORMATION tab in Share. Important: There is no territory that currently meets the provisions of 38 CFR 3.653(a).

• Military engagements, or the presence of U.S. military troops within a foreign country, does not necessarily mean said country is an enemy of the U.S. under 38 CFR 3.653(a).
• North Atlantic Treaty Organization or United Nations peacekeeping presence within a country does not, by itself, qualify that country as an enemy of the U.S. or its allies under 38 CFR 3.653(a).

Reference: For more information about the policy expressed in this block, see 38 U.S.C. 5308.

X.i.3.B.5.b#Paying Benefits to the Dependent(s) of a Beneficiary Whose Award VA Discontinued Under the Provisions of 38 CFR 3.653(a)

After VA discontinues benefits under the provisions of 38 CFR 3.653(a), as discussed in M21-1, Part X, Subpart i, 3.B.5.a, VA may pay a portion of those benefits to the former beneficiary’s dependent(s), provided the dependent(s)

• submits a completed VA Form 21-0788, Information Regarding Apportionment of Beneficiary’s Award, and
• does not reside in a listed country as a non -U.S. citizen.

Important:

• The amount of benefits VA pays to the dependent(s) may not exceed the amount that would be payable to dependents of the same class if the beneficiary that resides in enemy territory were deceased.
• Payment of the benefit referenced in this block may not be authorized until the continued existence of the former beneficiary is established. If the benefit is disability compensation, the Veteran’s continued entitlement to disability compensation must also be established, unless the disabling effects of all of the Veteran's service-connected disabilities are static.
• Although VA requires the dependent(s) referenced in this block to complete VA Form 21-0788,
  • payment of the benefits referenced in this block does not constitute an apportionment, and
  • the instructions in M21-1, Part VII, Subpart iii, 1.A, are not for application.
• Follow the steps in the table below if VA
  • begins paying benefits to a dependent(s) according to the instructions in this block, and
  • is subsequently unable to confirm the continued existence of the former beneficiary.

X.i.3.B.5.c#Actions Former Beneficiaries Must Take Before VA Will Reconsider Awarding Benefits

VA will reconsider awarding benefits to a former beneficiary whose award VA discontinued under the provisions of 38 CFR 3.653(a) if the former beneficiary

• files a supplemental claim, and
• submits credible evidence showing he/she is not guilty of mutiny, treason, sabotage, or rendering assistance to the enemy.

The effective date of an award of benefits under the provisions of this block may be no earlier than the date VA received the supplemental claim. Reference: For more information about the principle discussed in this block, see 38 U.S.C. 5308(b).

6Loyalty Clearances

This topic contains information on loyalty clearances, including

• situations in which VA requires a loyalty clearance
• general guidelines on when to request a loyalty clearance
• circumstances under which VA does not require a loyalty clearance
• enemy territories and the dates hostilities ended
• information
  • required from a claimant to obtain a loyalty clearance, and
  • to request from the Office of Special Consular Services
• obtaining a loyalty clearance in Philippine cases, and
• action to take when records indicate an investigation is underway.

Revised June 8, 2018

X.i.3.B.6.a#Situations in Which VA Requires a Loyalty Clearance

Obtain a loyalty clearance if

• VA declares a forfeiture of benefits by reason of a treasonable act under 38 CFR 3.902(d), or
• it is required in connection with payments to an alien under 38 CFR 3.653(b).

X.i.3.B.6.b#General Guidelines on When to Request a Loyalty Clearance

Do not routinely request a loyalty clearance merely because the claimant resided in a territory of, or a territory under the control of, an enemy of the U.S. during World War II, unless the claimant resided in the Philippines. With the exception of Philippine cases, only request a loyalty clearance if the evidence of record indicates the claimant may have rendered, or was in a position to render, assistance to an enemy of the U.S. References: For more information on obtaining loyalty clearances in

• Philippine cases, see M21-1, Part X, Subpart i, 3.B.6.g, and
• all other cases, see M21-1, Part X, Subpart i, 3.B.6.e.

X.i.3.B.6.c#Circumstances Under Which VA Does Not Require a Loyalty Clearance

VA does not require a loyalty clearance because of residence in an enemy-occupied territory for

• a claimant who was under age 18 at the time hostilities ended in that area
• a child, regardless of age,
  • who is in the custody of a surviving spouse, and
  • for whom VA is paying benefits to the surviving spouse
• a claimant who
  • resided in Guam during the Japanese occupation, and
  • provides evidence of continuing residence in a State, as defined in 38 CFR 3.1(i), precluding forfeiture under 38 CFR 3.902(d)(2)
• a claimant who resided in an enemy-controlled territory and has since become a citizen of the U.S., and/or
• a claimant who first came into a territory under the former control of an enemy of the U.S. after hostilities ended in that area.

Note: Naturalized citizens must provide proof of naturalization. In the absence of evidence to the contrary, presume that the investigation associated with the naturalization proceedings established the loyalty of the claimant. Reference: For more information on enemy territories and the dates hostilities ended, see M21-1, Part X, Subpart i, 3.B.6.d.

X.i.3.B.6.d#Enemy Territories and the Dates Hostilities Ended

The table below lists enemy territories and the date hostilities ended in each.

X.i.3.B.6.e#Information Required From a Claimant to Obtain a Loyalty Clearance

For all original claims (except Philippine cases) where a loyalty clearance is required under M21-1, Part X, Subpart i, 3.B.6.a-c, ask the claimant for the following information:

• name of the person in question, including
  • family name
  • first name
  • middle name
  • maiden name in the case of a married female, and
  • any other name or names the person might have used
• date and place of birth
• date and place of all marriages
• former and present nationality, and
• all addresses and dates of residence in foreign countries.

Reference: For information on obtaining loyalty clearances in Philippine cases, see M21-1, Part X, Subpart i, 3.B.6.g.

X.i.3.B.6.f#Information to Request From the Office of Special Consular Services

Through appropriate correspondence with the Office of Special Consular Services, Department of State, request assistance in obtaining any evidence as to whether or not the claimant

• has ever been found guilty of the offenses in 38 U.S.C. 6104, or
• was a member of the Fascist or Nazi parties, including
  • information as to whether such membership was discontinued and, if so,
  • the date of discontinuation of membership.

X.i.3.B.6.g#Obtaining a Loyalty Clearance in Philippine Cases

If a loyalty clearance is required in a Philippine case

• ask the claimant to complete VA Form 21-4169 , Supplement to VA Forms 21-526EZ, 21P-534EZ, and 21P-535 (For Philippine Claims), and
• use the information furnished by the Department of the Army, based on Counterintelligence Corps and other records, as a basis for the loyalty clearance.

Note: A report from these sources that no derogatory information is available relative to the guilt of the claimant or the Veteran will sustain a presumption of innocence for adjudicative purposes or until evidence is received indicating guilt of one of the offenses in 38 U.S.C. 6104. Reference: For more information on obtaining loyalty information in Philippine cases, see M21-1, Part X, Subpart i, 4.C.1.

X.i.3.B.6.h#Action to Take When Records Indicate an Investigation Is Underway

When records show the Department of State has already initiated an investigation under 38 U.S.C. 6104

• do not make a specific request for such investigation, and
• establish local control for receipt of the report.

7Services the Department of State Provides

This topic contains information on services the Department of State provides, including

• expenses associated with services the Department of State provides, and
• services consular officers may provide.

Revised October 27, 2017

X.i.3.B.7.a#Expenses Associated With Services the Department of State Provides

The Department of State generally provides services through consular officers at American embassies and consulates, including investigation in foreign countries, without cost to VA. The Department of State informs VA if an expense will be incurred.

X.i.3.B.7.b#Services Consular Officers May Provide

Consular officers may

• furnish general information and assistance, including assistance to claimants, beneficiaries, and apportionees, in the preparation of applications for benefits
• inspect and approve institutions for pursuit of courses of study by children between the ages of 18 and 23
• investigate and develop claims at VA’s request and perform other services in connection with a claim
• administer oaths for VA purposes
• take action at the request of the Under Secretary for Benefits or his/her designee on matters involving guardianship, and
• make arrangements for physical examinations.

Reference: For more information on ROs that are responsible for processing foreign claims and contacting the consular officers, see M21-1, Part X, Subpart i, 3.B.8.c.

8Authentication of Foreign Documents Under 38 CFR 3.202

This topic contains information about the authentication of foreign documents under 38 CFR 3.202, including

• when authentication of a foreign document
  • is required, and
  • is not required
• requesting authentication of foreign documents at
  • the Pittsburgh RO or Philadelphia Pension Management Center (PMC), and
  • all other ROs, and
• action to take when the Benefits Assistance Service (BAS) is unable to obtain authentication.

Revised February 28, 2019

X.i.3.B.8.a#When Authentication of a Foreign Document Is Required

Except as provided in M21-1, Part X, Subpart i, 3.B.8.b, if an affidavit or document is executed by or before an official in a foreign country, the signature of that official must be authenticated by

• a U.S. consular officer in that jurisdiction, or
• the Department of State.

X.i.3.B.8.b#When Authentication of a Foreign Document Is Not Required

Authentication of a foreign document is not required if

• the Deputy Minister of Veterans Affairs, Veterans Affairs Canada (VAC), submitted and approved the document
• the attesting officer is authorized to administer oaths for general purposes and the document bears that officer’s signature and seal
• the document is executed before a VA employee located in a foreign country who is authorized to administer oaths, or
• a copy of a public or church record from any foreign country purports to establish birth, marriage, divorce, or death, provided
  • the record bears the signature and seal of the custodian of such record, and
  • there is no reason to doubt the correctness of information shown on the record.

X.i.3.B.8.c#Requesting Authentication of Foreign Documents at the Pittsburgh RO or Philadelphia PMC

The Pittsburgh RO and Philadelphia Pension Management Center (PMC) send requests for authentication of foreign documents directly to the embassy or consulate of the country in which the document was created. Exception: The ROs send requests for authentication of documents that originated in Canada to VAC. Notes:

• All foreign claims for compensation will be routed to and worked at the Pittsburgh RO. This includes legacy appeals, work items, and non-rating end products.
• All foreign claims for pension will be routed to and worked by the Philadelphia PMC.
• Send e-mail inquiries concerning the addresses of foreign embassies or consulates and the services they perform to VAVBAWAS/CO/OUTREACH.

X.i.3.B.8.d#Requesting Authentication of Foreign Documents at All Other ROs

To request authentication of a foreign document at ROs other than the Pittsburgh RO or Philadelphia PMC

• prepare a request for the signature of the Veterans Service Center Manager (VSCM)
• scan the request and foreign document into a digital format, and
• e-mail the request and foreign document to the Benefits Assistance Service (BAS) at VAVBAWAS/CO/OUTREACH.

Notes:

• BAS forwards the request for authentication to the appropriate Foreign Service post.
• E-mail inquiries concerning the services foreign consulates or embassies perform to VAVBAWAS/CO/OUTREACH.

X.i.3.B.8.e#Action to Take When the BAS Is Unable to Obtain Authentication

If BAS is unable to obtain authentication of a foreign document

• return the document to the claimant, and
• advise him/her that VA can take no further action on his/her claim until he/she submits acceptable documentation.

9Translation of Foreign Correspondence and Documents

This topic contains information on the translation of foreign correspondence and documents, including

• referrals for translation of foreign documents within the local RO, and
• action to take when translation is not obtainable using local resources.

Revised November 13, 2020

X.i.3.B.9.a#Referrals for Translation of Foreign Documents Within the Local RO

A document written in any language other than English shall be referred to an employee in the local RO or an approved translation company who is deemed qualified by the Director and/or VSCM. This includes the following document(s) that could possibly contain foreign language:

• letters or lay statements from a claimant or witness
• medical documents, or
• Social Security Administration documents.

If the RO employee provides translation, the employee must certify its accuracy by signing and dating a written statement to this effect. When routing the request to an approved translation company

• make a copy of the document(s) to be translated
• annotate the claims folder to show the document(s) is/are being translated, and
• update the claim level suspense to show the request is pending with translations.

Reference: For more information on how to annotate a document in VBMS, see the VBMS Core User Guide .

X.i.3.B.9.b#Action to Take When Translation Is Not Obtainable Using Local Resources

If local resources do not exist for translation of a document written in a foreign language, follow the steps in the table below to request translation through the Pittsburgh RO.

Notes:

• Normal processing time for a request for translation is 10 days.
• Priority processing time is dependent upon the type of language and the number of documents that require translation.
• When translation is complete, the Pittsburgh RO
  • uploads the translated documents into VBMS, and
  • marks the tracked item as received to facilitate routing of the claim.