38 CFR 21.4006: False or misleading statements.

(a) Payments may not be based on false statements. Except as provided in this section payments may not be authorized based on a claim where it is found that the school or any person has willfully submitted a false or misleading claim, or that the veteran or eligible person with the complicity of the school or other person has submitted such a claim. A complete report of the facts will be made to the State approving agency, and if in order to the Attorney General of the United States.

(1) Where it is determined prior to payment that a certification or claim is false or misleading, payment will be authorized for only that portion of the claim to which entitlement is established on the basis of other evidence of record.

(2) When the Department of Veterans Affairs discovers that a certification or claim is false after it has released payment, the Department of Veterans Affairs will establish an overpayment for only that portion of the claim to which the claimant was not entitled.

(b) Effect of false statements on subsequent payments. A claimant's false or misleading statements are not a bar to payments based on further training.

(c) Forfeiture. The provisions of this section do not apply when forfeiture of all rights has been or may be declared under the provisions of § 21.4007.