
From the U.S. Code Online via GPO Access
[wais.access.gpo.gov]
[Laws in effect as of January 23, 2000]
[Document not affected by Public Laws enacted between
  January 23, 2000 and December 4, 2001]
[CITE: 38USC3726]

 
                      TITLE 38--VETERANS' BENEFITS
 
               PART III--READJUSTMENT AND RELATED BENEFITS
 
              CHAPTER 37--HOUSING AND SMALL BUSINESS LOANS
 
                SUBCHAPTER III--ADMINISTRATIVE PROVISIONS
 
Sec. 3726. Withholding of payments, benefits, etc.

    (a) No officer, employee, department, or agency of the United States 
shall set off against, or otherwise withhold from, any veteran or the 
surviving spouse of any veteran any payments (other than benefit 
payments under any law administered by the Department of Veterans 
Affairs) which such veteran or surviving spouse would otherwise be 
entitled to receive because of any liability to the Secretary allegedly 
arising out of any loan made to, assumed by, or guaranteed or insured on 
account of, such veteran or surviving spouse under this chapter, unless 
the Secretary provides such veteran or surviving spouse with notice by 
certified mail with return receipt requested of the authority of the 
Secretary to waive the payment of indebtedness under section 5302(b) of 
this title.
    (b) If the Secretary does not waive the entire amount of the 
liability, the Secretary shall then determine whether the veteran or 
surviving spouse should be released from liability under section 3713(b) 
of this title.
    (c) If the Secretary determines that the veteran or surviving spouse 
should not be released from liability, the Secretary shall notify the 
veteran or surviving spouse of that determination and provide a notice 
of the procedure for appealing that determination, unless the Secretary 
has previously made such determination and notified the veteran or 
surviving spouse of the procedure for appealing the determination.

(Added Pub. L. 89-358, Sec. 5(f)(1), Mar. 3, 1966, 80 Stat. 26, 
Sec. 1826; amended Pub. L. 94-324, Sec. 7(30), June 30, 1976, 90 Stat. 
722; Pub. L. 97-66, title V, Sec. 504, Oct. 17, 1981, 95 Stat. 1033; 
Pub. L. 101-237, title III, Sec. 313(b)(1), (2), Dec. 18, 1989, 103 
Stat. 2077; renumbered Sec. 3726, Pub. L. 102-83, Sec. 5(a), Aug. 6, 
1991, 105 Stat. 406; Pub. L. 105-33, title VIII, Sec. 8033(a), Aug. 5, 
1997, 111 Stat. 669.)


                               Amendments

    1997--Pub. L. 105-33 designated existing provisions as subsec. (a), 
substituted ``unless the Secretary provides such veteran or surviving 
spouse with notice by certified mail with return receipt requested of 
the authority of the Secretary to waive the payment of indebtedness 
under section 5302(b) of this title.'' for ``unless (1) there is first 
received the consent in writing of such veteran or surviving spouse, as 
the case may be, or (2) such liability and the amount thereof was 
determined by a court of competent jurisdiction in a proceeding to which 
such veteran or surviving spouse was a party.'', and added subsecs. (b) 
and (c).
    1991--Pub. L. 102-83 renumbered section 1826 of this title as this 
section.
    1989--Pub. L. 101-237 substituted ``Secretary'' and ``Department of 
Veterans Affairs'' for ``Administrator'' and ``Veterans' 
Administration'', respectively.
    1981--Pub. L. 97-66 struck out subsec. (a) which provided that the 
Administrator could not, unless the Administrator had first obtained the 
consent in writing of an individual, set off against, or otherwise 
withhold from, such individual any benefits payable to such individual 
under any law administered by the Veterans' Administration because of 
liability allegedly arising out of any loan made to, assumed by, or 
guaranteed or insured on account of, such individual under this chapter, 
and struck out designation ``(b)'' before ``No officer, employee, 
department, or agency of the United States''.
    1976--Subsec. (a). Pub. L. 94-324 substituted ``the Administrator'' 
for ``he''.
    Subsec. (b). Pub. L. 94-324 substituted ``surviving spouse'' for 
``widow'' wherever appearing.


                    Effective Date of 1997 Amendment

    Section 8033(c) of Pub. L. 105-33 provided that: ``The amendments 
made by this section [amending this section and section 5302 of this 
title] shall apply with respect to any indebtedness to the United States 
arising pursuant to chapter 37 of title 38, United States Code, before, 
on, or after the date of enactment of this Act [Aug. 5, 1997].''


                    Effective Date of 1981 Amendment

    Amendment by Pub. L. 97-66 effective Oct. 17, 1980, see section 
701(b)(3) of Pub. L. 97-66, set out as a note under section 1114 of this 
title.


                    Effective Date of 1976 Amendment

    Amendment by Pub. L. 94-324 effective June 30, 1976, see section 
9(a) of Pub. L. 94-324, set out as a note under section 3701 of this 
title.
