Congress Weighs Competing Proposals to Tackle Companies Charging Veterans to File Claims

Seal displayed on the front of the Veterans Affairs Department building
A seal is displayed on the front of the Veterans Affairs Department building in Washington on June 21, 2013. (AP Photo/Charles Dharapak, File)

A fight is bubbling up over competing proposals in Congress to address companies that charge fees to help veterans file disability benefits claims.

On the one side is a bipartisan group of lawmakers, veterans service organizations and the Department of Veterans Affairs that wants to impose criminal penalties on any unaccredited company that charges veterans to file claims on their behalf.

On the other side is another group of lawmakers and some unaccredited companies that argue a small number of bad actors charging outrageous fees is making the whole industry look bad and that veterans should be able to choose to hire someone to help them if they want. That side is pushing to change the accreditation process so companies can legally continue their operations, in addition to imposing criminal penalties on businesses that remain unaccredited.

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It's unclear whether either proposal has enough momentum to pass in a Congress that has focused its attention on other issues. But with claims mounting after last year's passage of the PACT Act and concerns that fraudsters will take advantage of veterans desperate to get the expanded benefits, advocates on both sides of the issue say something needs to be done.

"This is the largest benefit expansion in generations, and people are viewing dollar signs on the backs of veterans," said Pat Murray, director of national legislative service at the Veterans of Foreign Wars, which supports the bill that only imposes criminal penalties on unaccredited businesses.

The VA has a process to accredit veterans service organizations, attorneys and independent agents to help veterans file benefits claims. Under VA rules, those helpers can't charge to file initial claims, but agents and attorneys can charge to assist with appeals.

It is already illegal for unaccredited agents to prepare, present or file claims on behalf of veterans. But in 2006, Congress removed criminal penalties for doing so -- contributing to a growing industry of companies offering to help veterans file claims for a fee.

The Governing Unaccredited Representatives Defrauding VA Benefits Act – known as the GUARD Act – would reimpose criminal penalties on those companies. The House version of the bill would levy fines, while the Senate version includes both fines and up to one year in prison.

The GUARD Act has been introduced in previous congressional sessions but has struggled to pass. But after it was reintroduced this year, both the Senate Veterans Affairs Committee and a House Veterans Affairs Committee subpanel held hearings on the bill.

In the House and Senate hearings, the VA and veterans service organizations testified in support of the legislation. About 40% of complaints to the VA's legal office over the last year were about unaccredited agents, but there is little the department can do about those complaints right now, testified Christa Shriber, deputy chief counsel at the VA.

"Our recourse there has been to inform the [agent] that they are doing something contrary to law, and then work with our partners, either federal enforcement agencies or state agencies, to see if there are state laws or consumer protection laws that they may have violated," Shriber said in March. "There is no direct link between doing what our law says is wrong and a punishment."

The bill, which was introduced by Sen. John Boozman, R-Ark., also has the support of Senate Veterans Affairs Committee Chairman Jon Tester, D-Mont., as well as 16 other Senate co-sponsors and 119 co-sponsors in the House.

Meanwhile, in March, Reps. Jack Bergman, R-Miss.; Lou Correa, D-Calif.; and Nancy Mace, R-S.C., introduced the Preserving Lawful Utilization of Services for Veterans Act – the PLUS Act. Sen. John Kennedy, R-La., introduced the Senate version in June. The bill has 10 other Republican House co-sponsors and no Senate co-sponsors.

"It's imperative that we close the loopholes that bad actors exploit and protect our veterans from abuse. At the same time, we must ensure that every veteran has the right to seek whatever private help they deem necessary when navigating their VA assistance," Bergman, a retired Marine Corps lieutenant general, said in a March statement.

The PLUS Act would give companies a way to become accredited while still charging fees to file initial claims. The fees would be capped at $12,500 and could be taken from veterans' monthly benefits payments.

A company would be automatically accredited if the VA does not make a decision on its application within 90 days. Companies that choose to remain unaccredited would be subject to fines or up to a year in prison.

In an interview with, Veteran Benefits Guide, one of the companies lobbying for the PLUS Act, argued the bill sets up guardrails to prevent wrongdoing while giving veterans the choice to hire help if they want to. While any company could get accredited now if it stops charging fees, Veteran Benefits Guide also argued that it needs to charge to provide quality service.

"We have an infrastructure in place that caters to the accuracy of the veterans exam and rating to get the correct evidence in front of the VA," said Michael Licari, Veteran Benefits Guide's chief legal officer. "It costs a lot of money to train everybody to understand the super complicated process and how to navigate the super complex bureaucracy that is deciding these ratings."

Since the House and Senate hearings on the GUARD Act earlier this year, there has been no public movement on either bill. But behind-the-scenes negotiations are ongoing.

"Right now, there are active, bipartisan negotiations between the House and Senate on this issue with the goal of protecting veterans from bad actors and fraudsters, while still allowing veterans to have a choice and choose the avenue they want to assist with filing their claim," House Veterans Affairs Committee spokesperson Kathleen McCarthy told in an email, adding that the issue is a "top priority" for committee Chairman Mike Bost, R-Ill.

A staffer for Tester, who opposes the PLUS Act, confirmed he is working with veterans service organizations and House and Senate colleagues on a bipartisan compromise.

"I'll always fight to protect veterans from scammers looking to prey on their hard-earned benefits," Tester said in a statement. "And I'm hopeful we can move swiftly on this bipartisan effort to hold these predatory actors accountable by reinstating criminal penalties that will protect the men and women who fought to protect our country."

The VFW would be open to a compromise in which accredited agents could charge to help file initial claims, said Murray, with the Veterans of Foreign Wars. But the PLUS Act as written contains "absolute nonstarters," he added, particularly the automatic accreditation after 90 days and the language that allows companies to structure fees to garnish monthly benefits payments.

The VFW supports "everybody playing in the sandbox with the same set of rules," Murray said. "The VFW will never charge a single penny for that, nor will the other veteran service organizations who do this stuff for free. But accredited agents and attorneys make good money representing veterans, but they do it following rules.”

"The PLUS Act and some of the advocates who are pushing for that want to just change the whole framework essentially to legalize their fee structure and what they're currently doing," he added.

Other veterans organizations were more blunt.

"Our position is pretty clear," said Shane Liermann, deputy national legislative director at the Disabled American Veterans. "No veteran should have to pay anybody to file a claim."

Editor's note: This story was updated to clarify what services unaccredited agents are prohibited from performing under the law.

-- Rebecca Kheel can be reached at Follow her on Twitter @reporterkheel.

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