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The federal government demanded more than $180,000 from a disabled army veteran in what turned out to be a "horrendous" administrative error by the Department of Veterans' Affairs. The case is not an isolated one, soldiers' advocates say, with the troubled and cash-strapped department increasing its demands on former Diggers to repay benefits in what it calls "overpayments and offsets". But the department says there is no evidence to support those claims. The former soldier, mother-of-two Danielle Khan, had to fight for 19 months before DVA agreed the money was not owed, was left with an $11,000 legal bill and says the department then blocked her access to the official process for recovering her lawyers' fees. The department says it will not comment on individual cases, citing privacy concerns. Ms Khan has been unable to work and in chronic pain since 1998 when she suffered a serious spinal injury while on army exercises in NSW and says she has been constantly battling against DVA since soon after she was hurt. In January 2014, Veterans' Affairs' Townsville office wrote to Ms Khan demanding that several years' incapacity payments, amounting to $182,000, be refunded to the government and alleging the former soldier had failed to meet her obligations to lodge paperwork. But after a 19-month struggle, DVA backed down, admitting that no "overpayment" had been incurred. But Ms Khan said the episode was a personal nightmare reflecting the experiences of many of her former comrades. "I ended up in the mental health unit," she said. "Getting this letter, all you think is 'what am I going to do, how am I going to get out of this?'." Ms Khan, who is fighting a separate legal action against DVA over the classification of her injuries, says that she and other former ADF personnel want to see an official inquiry into the department's conduct. "DVA is not looking after veterans, not in my case and not in a lot of other cases that I know about," she said. "Seven people I know have given up the fight through suicide and I'd like to see an inquiry or a royal commission and for the minister to admit there's a problem and then do something about it." Greg Isolani, of Melbourne firm KCI Lawyers, says he has seen an upsurge of cases where DVA is trying to claw back money from veterans. "It's unprecedented, in 23 years of my practice, that there's been a flurry of overpayments like this," Mr Isolani said. "It's just shambolic and there's a range of issues. "DVA keep having these so-called computer glitches, that keep people on payment after 45 weeks rather than dropping it down and then they demand it back," "They're quite ruthless, they don't say that it took them two years to clock up thirty grand and give two years to pay it back, they just ask for a cheque payable." The department rejected the advocate's criticism. "There is no evidence that numbers of overpayments identified have increased over the past five years," a spokeswoman said. "The value of overpayments identified varies from year to year, and there has been a small increase overall. "DVA is required to ensure that it only pays clients benefits to which they are entitled and clients have an obligation to advise DVA of changes in their circumstances. "Overpayments can occur when clients do not meet, or no longer meet, eligibility requirements for a benefit."

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