Hundreds of Washington-area veterans are being taken to court by the Veterans Administration as part of a nationwide crackdown on students who allegedly have failed to repay $50 million in educationsl benefits to which they were not entitled.

The overpayments generally occurred when veterans enrolled in school, were paid benefits, and then either dropped out or took fewer classes than they were paid for.

Two years ago the VA reported that Northern Virginia Community College students were overpaid $700,000 over a two-year period and students at the old Federal City College were overpaid $800,000. But until recently, little of the money, sought through written notices from VA and requests by the General Accounting Office, had ben repaid.

Under a policy started last March, the cases are sent to the 94 U.S. attorneys around the country for civil prosecution. The GAO, which used to be responsible for these cases, had been unsuccessful over the years in collecting the debt.

Va officials estimated that there are about 2,000 such cases in this area, although precise figures could not be obtained immediately.

One such case is that of Allan J. Sutter, of the District. "I got sick and had to leave classes," said Sutter, who was being sued for $904.74 in overpayments he received. "I did that two semesters in a row. I got the money and then I got sick. Then I spent it."

Sutter, who was studying accounting at the University of Maryland, said he thought it was all right to spend the money although he was not in school. "I intended to go back to school and use it anyway. I thought it was okay."

Sutter said he and the VA have agreed that the suit would be dropped if he went back to school.

"We've had 60 cases referred to us in this districts," said George Williams, assistant U.S. Attorney in Alexandria. "And I expect a lot more. There's a big push to get these things paid." Williams said he remembers only one or two such cases previously.

Nationally, VA officials said, they have referred 12,866 cases against veterans to federal prosecutors since March and a GAO official said that they are referring an estimated 35,000 more cases that had "stacked up here" to the U.S. attorneys. Peter Coy, assistant director for claims at GAO said each of the cases involves about $1,000 in overpayments. Coy said it will be another year before the backlog is cleared.

Of the $14 million sought by the VA, about $500,000 worth of cases have been disposed of by federal prosecutors, according to Jack Colbert of the VA Comptroller's office.

The GAO does not have records of its effectiveness in recouping the debt, Coy said, but "we give a volume each week to U.S. attorneys. Those poor U.S. attorneys."

A veteran can attend any college, university, flight schools, correspondence school, junior college or vocational school approved by a state committee, Colbert said. Payments depend on the number of dependents the veteran has, his income, and the number of credits for which he has enrolled.

Veterans with too many dependents or not enough income to pay the debts, Colbert said, are not sued and other arrangements are made.

When requested to pay up, many of the veterans "don't have it or don't reply. Most of them, more than half, disregard the notices," Colbert said. "Our efforts to go directly to the Justice (Department) is a big push."

In some cases, schools that failed to notify the VA of students who dropped classes or dropped out, may also be liable, Colbert said. Colbert said, however, he was unaware of any school now facing legal action.

Another area student, David A. Rapelyea of Alexandria, said he doesn't owe the VA the $861.30 they are suing him for. "I guess the VA fouled up somehow," said Rapelyea, a corrections officer at Lorton Reformatory.

"Last April I received an academic warning from Northern Virginia Community College," Rapelyea said. "When the school sent (thewarning) out to the VA, the VA cancelled (the benefits) and I was still going to school."

Colbert said it is doubtful that the VA could have mistakenly cancelled a veteran's payments, but he added, "There may be some that slipped through."*