You will be redirected to the page you want to view in  seconds.

Congress presses DoD for allotment system reform

Jul. 31, 2014 - 06:00AM   |  
(File photo)
  • Filed Under

Lawmakers are stepping up pressure on the Pentagon to improve the paycheck allotment system that allows service members to direct portions of their biweekly pay to certain people or institutions.

The call from Capitol Hill comes amid new reports of predatory lenders who abuse the system by requiring troops to authorize paycheck allotments as a condition of borrowing.

Last week ProPublica, a not-for-profit news organization, published an investigative report about USA Discounters, a little-known firm that allegedly offers troops high-interest loans to buy furniture and electronics and then seizes their active-duty pay using the allotment system.

In June 2013, Defense Secretary Chuck Hagel ordered a review of the military’s allotment system, and asked for a report to include recommendations on ways to protect service members from exploitation.

Now four Democratic senators are urging Hagel to wrap up his review.

“We need to crack down on predatory lenders that target military members,” Sen. Jack Reed, D-R.I., wrote in a letter to Pentagon officials Thursday. “It’s time for Secretary Hagel to expedite the DoD report so we can move quickly to prevent similar issues in the future.”

Pentagon spokesman Cmdr. Bill Urban said Thursday that the allotment review and a recommendation is expected to be forwarded to Hagel “soon.”

Answers by RallyPoint

Join trending discussions in the military's #1 professional community. See what members like yourself have to say from across the DoD.

More In Pay & Benefits

Start your day with a roundup of top defense news.

VA Home Loan

Search By:

Product Options:
Zip Code:

News for your in-box

Sign up now for free Military Times E-Reports. Choose from Money and Education. Subscribers: log in for premium e-newsletters.

This Week's Air Force Times

This Week's Air Force Times

CrossFit vs. unit PT
Troops will do the training plans in a $2.5 million study

Subscribe for Print or Digital delivery today!

MilitaryTimes Green Trusted Classifieds Looking to buy, sell and connect on Military Times?
Browse expanded listings across hundreds of military installations.
Faces of valorHonoring those who fought and died in Operations Iraqi Freedom and Enduring Freedom.
hall of valorThe Hall of Valor is a searchable database of valor award citations collected by Doug Sterner, a Vietnam veteran and Military Times contributing editor, and by Military Times staff.

All you need to know about your military benefits.

Benefits handbook

Guard & Reserve All you need to know about the Guard & Reserve.

guard and reserve handbook