Congress calls for a crackdown on companies charging disabled vets
A group of 43 members of Congress is calling for action against unaccredited companies that charge veterans for help filing for disability benefits with the Department of Veterans Affairs.
“For years, we have warned that unaccredited representatives — commonly known as claim sharks — charge illegal fees, misrepresent their services, and exploit a loophole in federal law to escape accountability,” the group wrote in a letter Wednesday to VA, the Federal Trade Commission and the Consumer Financial Protection Bureau. “These practices represent a deeply disturbing escalation in claim shark industry tactics.”
The letter was signed by 42 Democrats and one Republican.
Federal law states that anyone helping veterans prepare initial claims for disability benefits must be accredited by the VA and that the service must be free. Nonprofit veterans service organizations such as The American Legion and VFW have long helped vets with such claims.
But in an effort to reduce barriers for vets, Congress removed criminal penalties from the law in 2006. Entrepreneurs leapt into that legal gray area, realizing they could help vets and make money. The number of these claims consulting outfits has exploded over the last 10 years.
Lawmakers wrote in their letter that these tactics “raise serious questions about data privacy, informed consent, financial security, and whether these companies are accessing or leveraging sensitive VA-related information in ways that may violate federal laws.”
New Hampshire Congressman Chris Pappas, a Democrat, is the co-sponsor of a bill to rein in the claims industry. He co-authored the letter and gathered signatures from more than 40 of his House colleagues. Rep. Don Bacon of Nebraska, a retired Air Force Brigadier General, was the lone Republican to sign.
Pappas’ bill, the GUARD VA Benefits Act, would reinstate the penalties that were removed nearly two decades ago. But the legislation is locked in a stalemate with the competing CHOICE for Veterans Act, sponsored by Republican Congressman Jack Bergman of Michigan, which would set a $12,500 cap on what claims consulting firms can charge.
