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Pentagon requests bank to stand down

Bank of America is asked to stop "hounding" reservists who are late with payments on their government-issued credit cards.

By PAUL DE LA GARZA, Times Staff Writer
© St. Petersburg Times
published May 29, 2003

TAMPA - The Pentagon has asked Bank of America to stop "hounding" U.S. troops who have overdue bills on government-issued credit cards, U.S. Sen. Bill Nelson said Wednesday.

In response, the bank has indicated it will cut back on the number of collection calls it makes to service personnel, defense officials say.

The Pentagon's check-writing office has fallen behind in reimbursing travel and other expenses for about 23,000 Army reservists and members of the Army National Guard, including reservists deployed at the Central Command in Tampa.

Pentagon officials blame the backlog on the scope of the war on terror.

As a result, some reservists have been unable to pay their credit card bills, prompting bank representatives to call repeatedly asking for payment.

Nelson, the Florida Democrat who sits on the Senate Armed Services Committee, asked the Pentagon for a review of the problem on Friday after learning about it from the St. Petersburg Times.

On Wednesday, Nelson said Pentagon officials acknowledged "a serious backlog" and told him they were working to resolve it.

"We're going to monitor it and make sure it is corrected, because this is inexcusable," Nelson said. "Our troops ought to be honored, not harassed as a result of government ineptitude."

Betty Riess, a Bank of America spokeswoman in San Francisco, said she could not comment on communications between the bank and the Defense Department. "We'll work with them to be as flexible as possible," she said.

Nelson said military officials told him they have hired 200 accounting and finance contractors, and have put civilian employees on a "wartime footing," or mandatory overtime, to process the backlog.

The Pentagon is also requesting additional reserve units and is considering creating a clearinghouse in Cleveland to help resolve pay issues.

Bryan Hubbard, a spokesman for the Defense Finance and Accounting Service, the accounting arm of the Pentagon, said the agency had been working with Bank of America "so the bank understands what the issue is."

Hubbard said the Pentagon division that handles travel reimbursements for reservists had alerted him to its discussions with the bank.

In an e-mail Monday, Hubbard said the agency's travel office wrote him the following: "We have been in contact with Bank of America and we are looking at alternatives to help alleviate the situation. Bank of America has indicated they are cutting back on collection calls being made."

Hubbard said the Pentagon had been working on the problem even before Nelson started asking questions. There was no link between news reports about the backlog and efforts to address it, he said.

He said defense officials recognized early on that a backlog could develop because of the size of the reserve forces being mobilized. Since the terrorist attacks on Sept. 11, 2001, 80,000 Army reservists have been mobilized and almost as many members of the Army National Guard.

"We recognize the soldier's mind needs to be on the mission, not on the money," Hubbard said. "This kind of thing is a distraction that we work very hard to avoid."

Steve Stromvall, an Army Reserve spokesman at Fort McPherson in Atlanta, said he was thrilled that the Pentagon "owned up to the issue."

"I think they did the right thing," Stromvall said. "When we mobilize a soldier, we have an obligation. They have to be able to concentrate on the job."

Maj. Brad Lowell, a CentCom spokesman, said last week that the situation here was not as severe as the national figures indicated. He said fewer than 10 reservists assigned to CentCom, the unified command overseeing the war in Iraq, had sought help to resolve pay issues since 9/11.

However, in response to the Pentagon directive on Wednesday, Lowell said, "Anything that benefits someone, active duty or reserve, obviously we are going to support it."

MacDill Air Force Base has about 1,400 reservists from the various services. The problem with reservists here appears to be especially acute for soldiers who live off base.

The problem often comes down to rent payments. When reservists arrive on base for assignments that range from six months to a year, they can get lodging on base at the MacDill Inn, which has 300 quarters assigned to military personnel.

Often there is no room available, so reservists are assigned off-base housing.

Reservists can choose to cover the rent themselves, but many charge it on government-issued Bank of America credit cards.

The credit cards, used to cover business expenses, including rent, food and car rental, are issued depending upon how often reservists travel. Each credit card has a limit of several thousands dollars and the entire balance must be paid off each month.

To cover the rent, reservists file a voucher for reimbursement and pay off the credit card balance when they get reimbursed.

A transaction that used to take federal officials eight days to process, however, now takes as much as 23 days, Hubbard said.

That means some reservists have been unable to pay their credit card bills on time, triggering telephone calls from the bank. If payment is more than a month late, the bank freezes the credit card account.

- Paul de la Garza can be reached at 813-226-3403, or delagarza@sptimes.com

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