Christophe
This is certainly a complex case, but I hope that I can help explain. To assist, I will attach a copy of the telegram.
First, I think you misunderstand the numbers and date at the top of the telegram: 3 17 1940. This is not intended to represent 17 5 1940 as you suggest. It has never been the convention in the UK, and neither is it today, to express a date such as 17 May 1940 as 5.17.1940. This is an American convention and not one ever used, to my knowledge, by the British. In just the same way, our American cousins talk about 9/11. In "English speak" this would really be 9 November, not 11 September! In any event, the typed numbers you talk about clearly include a 3...not a 5.
Let me expand a little on the detail of the telegram.
It is clear that the RAF and Air Ministry were in a muddle about the loss of Allen. This is not at all uncommon in relation to casualties in France at this time.
What we know is that the family were in receipt of a telegram on 18 May saying that Derek was reported as missing as the result of air operations on 17 May and it can only be concluded that this telegram was in relation to Derek Allen being shot down on 15 May, an event from which he was 'missing' for over 24 hours. I suspect the 17 May date must be in error for the 15 May, but the irony is that by the time the family read this telegram he had returned to his squadron and been shot down again, and this time killed, on 18 May 1940.
This telegram does not relate to his death on 18 May, but the earlier event that he survived.
It is much more complicated that that, but I cover it all in detail in "Finding The Fallen", Chapter 13. See here:
http://www.amazon.co.uk/Finding-Fall.../dp/1908117109