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View Full Version : Department of Defense Announces New Policy on Service Member Allotments



Rusty Jones
12-28-2014, 08:33 PM
http://www.defense.gov/Releases/Release.aspx?ReleaseID=17045

IMMEDIATE RELEASE

Release No: NR-585-14
November 21, 2014


Department of Defense Announces New Policy on Service Member Allotments


The Department of Defense announced today a change to policy that will prohibit service members from using new allotments to purchase, lease or rent personal property effective Jan. 1, 2015.

Secretary of Defense Chuck Hagel directed the change following an interagency review conducted in response to a major enforcement action by the Consumer Financial Protection Bureau.

This policy change will eliminate that aspect of the allotment system most prone to abuse by unscrupulous lenders that prey on our service members. This will significantly improve protections for all service members and their families, while not significantly reducing the flexibility to use allotments for a number of legitimate purposes.

The change will be incorporated into DoD Financial Management Regulation and will apply only to service members and not to military retirees or DoD civilians. Additionally, it will not affect existing allotments or prohibit allotments made to savings accounts, support dependents, pay insurance premiums, pay mortgages, pay rents or fund investments.

For further information please see DoD’s fact sheet: http://www.defense.gov/pubs/Fact-Sheet-on-New-DoD-Policy-Change-to-Allotment-System.pdf

This, by far, has to be the most retarded thing I've ever seen the DoD do. This surpases the ban on payday loans.

I suppose DoD is worried about young troops buying cars and furniture with allotments. Great, you know... I've used allotments as a convenient way to pay for things, that way everything is always paid on time and I don't have to worry about that.

What, does DoD think that by doing this, young troops aren't going to buy things and get themselves into financial trouble? What a joke... this will make problems WORSE. Because now, by doing away with the "fix it and forget" convenience of allotments, this will now require troops to actively stay on top of their payments... and resist the temptation to pocket the money instead of making the payment... on credit that they're STILL going to get ANYWAY.

Gotta love it... they keep treating military members like children.

Absinthe Anecdote
12-28-2014, 10:30 PM
http://www.defense.gov/Releases/Release.aspx?ReleaseID=17045

This, by far, has to be the most retarded thing I've ever seen the DoD do. This surpases the ban on payday loans.

I suppose DoD is worried about young troops buying cars and furniture with allotments. Great, you know... I've used allotments as a convenient way to pay for things, that way everything is always paid on time and I don't have to worry about that.

What, does DoD think that by doing this, young troops aren't going to buy things and get themselves into financial trouble? What a joke... this will make problems WORSE. Because now, by doing away with the "fix it and forget" convenience of allotments, this will now require troops to actively stay on top of their payments... and resist the temptation to pocket the money instead of making the payment... on credit that they're STILL going to get ANYWAY.

Gotta love it... they keep treating military members like children.

I've always thought that allotments were for lazy idiots. There used to be some utility for it if you were deployed, but these days you can do electronic banking from anywhere.

As far as treating military members like children, too many act like children. They go out and get high interest car loans, payday loans, cash advances on credit cards, and get duped by trannies. You of all people should know that.

sandsjames
12-29-2014, 12:44 AM
I've always thought that allotments were for lazy idiots. There used to be some utility for it if you were deployed, but these days you can do electronic banking from anywhere.

As far as treating military members like children, too many act like children. They go out and get high interest car loans, payday loans, cash advances on credit cards, and get duped by trannies. You of all people should know that.I've always thought electronic banking was for lazy idiots. Take your lazy ass out of your recliner and head over to your local branch. Not only will you get some much needed exercise, you'll also get some socialization, which is good for your mental fitness.

Rusty Jones
12-29-2014, 06:40 AM
I've always thought that allotments were for lazy idiots. There used to be some utility for it if you were deployed, but these days you can do electronic banking from anywhere.

Right, because electronic banking requires more physical exertion and cognitive ability than allotments.


As far as treating military members like children, too many act like children. They go out and get high interest car loans, payday loans, cash advances on credit cards, and get duped by trannies. You of all people should know that.

I'd rather get duped by a tranny than to be one, Mr. Metro. At least those who get duped do the giving and not the taking.

SomeRandomGuy
12-29-2014, 03:18 PM
Rusty, this change was driven by a complaint (several actually) because of how allotments were handled for privatized housing. I for one am glad to see this happen. At most bases the housing allotments were handled by Military Assuarance Company. They had direct access to Start, Stop, or Change Allotments. They were even using a Format ID that we couldn't override at base level finance. Basically, you would sign a lease agreement and the company would control your allotment. People were having a lot of issues getting the allotments stopped and would come in to finance. We had no power to stop the alotments (at base level) because of the format ID they use. All we could do is direct them back to the privatized housing contractor.

It was a really shitty situation. Basically, the vendor could continue taking rent from you and you had no recourse to stop them. That's a terrible situation for a military member to be in and it caused a lot of hardship for people.

This solution is probably a bit to far but something needed to be done. In my opinion you should be able to do an allotment for anything you want as long as you are the person who inputs it on MyPay. That would mean you are free to control any changes. I'm actually not sure how this change will affect that. Is finance supposed to call each person who starts an allotment and ask them what it's for?

Rusty Jones
12-29-2014, 04:11 PM
Rusty, this change was driven by a complaint (several actually) because of how allotments were handled for privatized housing. I for one am glad to see this happen. At most bases the housing allotments were handled by Military Assuarance Company. They had direct access to Start, Stop, or Change Allotments. They were even using a Format ID that we couldn't override at base level finance. Basically, you would sign a lease agreement and the company would control your allotment. People were having a lot of issues getting the allotments stopped and would come in to finance. We had no power to stop the alotments (at base level) because of the format ID they use. All we could do is direct them back to the privatized housing contractor.

It was a really shitty situation. Basically, the vendor could continue taking rent from you and you had no recourse to stop them. That's a terrible situation for a military member to be in and it caused a lot of hardship for people.

This solution is probably a bit to far but something needed to be done. In my opinion you should be able to do an allotment for anything you want as long as you are the person who inputs it on MyPay. That would mean you are free to control any changes. I'm actually not sure how this change will affect that. Is finance supposed to call each person who starts an allotment and ask them what it's for?

According to the article, you can still have allotments for rent and mortgage. Just not merchandise.

SomeRandomGuy
12-29-2014, 06:45 PM
According to the article, you can still have allotments for rent and mortgage. Just not merchandise.

I just read the article. So basically it's on the service member to certify that the allotment isn't for a prohibited item. I don't understand this change at all.

In the article it says


Getting service members to buy things using allotments, even though they may not be able to afford them, is attractive to unscrupulous companies because payments made by allotment are virtually guaranteed.

How do they figure an allotment is virtually guaranteed? You always had the option to stop an allotment. These places just threaten to talk to your first sergeant. That won't change. It wasn't the allotment that made it guaranteed it was the chain of command getting involved. On a side note, depending how it's done it is possibly illegal to contact someone's employer (chain of command) about a debt anyways.



From the Fair Debt Collection Practices Act. A Debt collector may not contact the consumer.....

(3) at the consumer's place of employment if the debt collector knows or has reason to know that the consumer's employer prohibits the consumer from receiving such communication.

(b) COMMUNICATION WITH THIRD PARTIES. Except as provided in section 804, without the prior consent of the consumer given directly to the debt collector, or the express permission of a court of competent jurisdiction, or as reasonably necessary to effectuate a postjudgment judicial remedy, a debt collector may not communicate, in connection with the collection of any debt, with any person other than a consumer, his attorney, a consumer reporting agency if otherwise permitted by law, the creditor, the attorney of the creditor, or the attorney of the debt collector.

http://www.ftc.gov/enforcement/rules/rulemaking-regulatory-reform-proceedings/fair-debt-collection-practices-act-text

Talking to someone's chain of command sure sounds to me like unauthorized communcication with a third party.