In all, repayments were waived for 17,092 California Guard soldiers who were given what were later deemed questionable bonuses, according to a Defense Department report obtained by The Times. Those who already repaid their bonuses are being reimbursed.
The report, which was sent to the House and Senate Armed Services Committees this month, concludes that the overwhelming majority of California Guard soldiers did nothing wrong in accepting bonuses of $15,000 to $80,000 each. Only 393 soldiers have been ordered to return the money, chiefly due to disciplinary or criminal conduct.
The sweeping forgiveness represents an almost total retreat by the Pentagon and the California Guard, which drove the aggressive recoupment effort against thousands of military veterans — including some who were wounded in combat — and has yet to publicly apologize to them.
The California Guard used tax liens, wage garnishments and other heavy-handed tactics to try to recover the bonuses it paid to soldiers chiefly to enlist or reenlist between 2004 to 2010, a period when the Pentagon was desperate for troops it could send to war.
The scandal offers a dark perspective on the Pentagon's use of hefty cash incentives to fill its all-volunteer force during the longest era of warfare in the nation's history.
"The overwhelming majority" of cases "were resolved in favor of the individual soldier," the 26-page report by the undersecretary of Defense for personnel and readiness concludes. "In these cases, the soldier received a full grant of relief."
Many of the waivers were granted because files "lacked adequate documentation" or because "the soldier had deployed" to a combat zone, had "completed his/her service," or 'would not be expected to have known that he/she was ineligible for a bonus," the report said.
The report also carved out exceptions if a soldier who got a bonus "was deceased, a Purple Heart recipient, receiving combat disability compensation" or met other conditions.
Last October, The Times first disclosed the California Guard's aggressive campaign to force nearly 17,500 veterans to repay their bonuses.
In response, then-Secretary of Defense Ashton Carter suspended the recoupment effort. Two months later, Congress passed legislation that gave the Defense Department until July 30 to review every case with a goal of waiving the debts unless the soldier "knew or reasonably should have known" that he or she was ineligible for the bonus.
Pentagon officials said at the time they did not know how much money was involved, although they estimated it could be in the tens of millions of dollars. The total was far higher.
According to the report, the California Guard paid more than $233 million in bonuses and student loan repayments to fill its enlistment goals from 2004 to 2015.
For most of that time, the California Guard relied on a single enlisted soldier, Master Sgt. Toni Jaffe, to issue the bonuses with virtually no controls. Jaffe later said she faced intense pressure from higher-ups to approve the payments to meet enlistment goals.
After a federal and state investigation, Jaffe pleaded guilty in 2011 to charges of approving payments that she knew were fraudulent, and served 30 months in prison. The Guard simultaneously launched its aggressive recoupment effort, targeting soldiers who it said were ineligible for the bonuses, or whose cases lacked proper paperwork.
The Times found that most of the soldiers had taken the money in good faith, had served honorably and had fulfilled their enlistment contracts, often serving in war zones.
They were ordered to repay their bonuses years later. Many had left the military and had spent the money long ago on homes, cars and other expenses.
The Pentagon report backed those findings.
It said that "17,092 of these cases — the overwhelming majority — were resolved in favor of the individual soldier." In an additional 393 cases, it said, the available evidence did not support a full grant of relief.
Most of those in the latter cases were ordered to repay their bonus because they did not complete their enlistment contracts, either because they went absent without leave or were kicked out of the service due to drug abuse or other disciplinary problems.
"These cases typically involved a soldier's receipt of an incentive in exchange for an enlistment of a certain length, which was subsequently curtailed by the soldier's own misconduct — most frequently Absence without Leave or substance abuse," the report said.
Though Congress ordered the Pentagon to finish the review last month, appeals are ongoing for 191 of those soldiers, the report said. An additional 202 have exhausted their appeals and have repaid the money or still must do so.
Two soldiers who were ordered to pay back the money after their cases were reviewed were granted full forgiveness on appeal, the report said.
The report gives only a brief flavor of the tactics used by the Pentagon to go after soldiers that it formerly had accused of taking money improperly. Many soldiers ordered to repay the large sums were slapped with interest charges, wage garnishments and tax liens if they refused or could not.
After the scandal came to light last fall, the Defense Finance Accounting Service, the department unit responsible for collecting debts, "withdrew the existing debt collection actions from its own accounts," the report said.
The office also "requested that the Treasury Department, private debt collection agencies and credit reporting bureaus immediately expunge from their databases all collections records and other adverse information pertaining to these debts," the report said.
The California Guard did not respond to a request for comment.
The report shows that $80.9 million of the questionable bonuses went to newly recruited soldiers, while $73.5 million went to soldiers already in uniform. Many have said they were summoned to mass meetings and promised the money if they reenlisted for an additional six years.
An additional $3.27 million in recruiting bonuses went to officers.
In response to the bonus scandal, the National Guard has put in place new computer software that is intended to ensure that bonuses are not given out improperly, and California has adopted the system, the report said.
"It shouldn't have taken an act of Congress to have the [Defense Department] admit their mistake and fulfill the contracts made to our California National Guard," Denham said. "The men and women who wear the cloth of this nation deserve the security of knowing that the country they swore an oath to protect has their back at the end of their service."