Provides that, when in the opinion of the Secretary of Veterans Affairs (VA) a temporary fiduciary is needed to protect the benefits of a VA beneficiary while a determination of incompetency is being made or appealed or a fiduciary is appealing a determination of misuse, the Secretary may appoint one or more temporary fiduciaries for up to 120 days.
Requires the Secretary to provide a written statement to a beneficiary determined by the Secretary to be mentally incompetent for purposes of appointing a fiduciary. Allows the beneficiary to appeal such determination. Allows a beneficiary for whom the Secretary appoints a fiduciary to, at any time, request the Secretary to remove such fiduciary and appoint a new one. Requires the Secretary to comply with any such request made in good faith. Prohibits any such removal or new appointment from delaying or interrupting the beneficiary's receipt of benefits. Requires a appointed fiduciary appointed by the Secretary to act independently of the VA and in the interest of the beneficiary.
Provides for the predesignation of a fiduciary. Provides that, if a beneficiary does not designate a fiduciary, the Secretary shall appoint, to the extent possible, a fiduciary who is: (1) a relative, (2) a guardian, or (3) authorized to act on their behalf under a durable power of attorney. Provides for: (1) fiduciary commissions when necessary; and (2) the temporary payment of benefits to a person having custody and control of an incompetent or minor beneficiary, to be used solely for the benefit of the beneficiary.
Directs the Secretary to maintain a list of state and local agencies and nonprofit social service agencies that are qualified to act as a fiduciary.
Requires any certification of a fiduciary to be made on the basis of an inquiry or investigation of his or her fitness and qualifications. Requires the investigation to include a face-to-face interview and a background check. Allows a person convicted of a federal or state offense to serve as a fiduciary only when the Secretary finds such person to be appropriate under the circumstances. Requires each fiduciary to disclose the number of beneficiaries that the fiduciary acts on behalf of. Requires the Secretary to: (1) maintain records of any person who has previously served as a fiduciary and had such status revoked, and (2) notify the beneficiary within 14 days after learning that the fiduciary has been convicted of a crime.
Directs the Secretary, upon reason to believe that a fiduciary may be misusing all or part of a beneficiary benefit, to: (1) conduct a thorough investigation, and (2) report results to the Attorney General and the head of each federal department or agency that pays a beneficiary benefit to such fiduciary. Requires each Veterans Benefits Administration regional office to maintain specified fiduciary information.
Requires (under current law, permits) a fiduciary to file an annual accounting of the administration of beneficiary benefits. Requires the Secretary to conduct annual random audits of fiduciaries who receive a commission for such service. Requires fiduciary repayment of misused benefits.
[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[H.R. 894 Introduced in House (IH)]
113th CONGRESS
1st Session
H. R. 894
To amend title 38, United States Code, to improve the supervision of
fiduciaries of veterans under the laws administered by the Secretary of
Veterans Affairs.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
February 28, 2013
Mr. Johnson of Ohio (for himself, Mr. Stivers, Ms. Titus, and Mr. Roe
of Tennessee) introduced the following bill; which was referred to the
Committee on Veterans' Affairs
_______________________________________________________________________
A BILL
To amend title 38, United States Code, to improve the supervision of
fiduciaries of veterans under the laws administered by the Secretary of
Veterans Affairs.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. IMPROVEMENT OF FIDUCIARIES FOR VETERANS.
(a) Appointment and Supervision.--
(1) Section 5502 of title 38, United States Code, is
amended to read as follows:
``Sec. 5502. Appointment of fiduciaries
``(a) Appointment.--(1) Where it appears to the Secretary that the
interest of the beneficiary would be served thereby, payment of
benefits under any law administered by the Secretary may be made
directly to the beneficiary or to a relative or some other fiduciary
for the use and benefit of the beneficiary, regardless of any legal
disability on the part of the beneficiary.
``(2) When in the opinion of the Secretary, a temporary fiduciary
is needed in order to protect the benefits provided to the beneficiary
under any law administered by the Secretary while a determination of
incompetency is being made or appealed or a fiduciary is appealing a
determination of misuse, the Secretary may appoint one or more
temporary fiduciaries for a period not to exceed 120 days. If a final
decision has not been made within 120 days, the Secretary may not
continue the appointment of the fiduciary without obtaining a court
order for appointment of a guardian, conservator, or other fiduciary
under the authority provided in section 5502(b) of this title.
``(b) Appeals.--(1) If the Secretary determines a beneficiary to be
mentally incompetent for purposes of appointing a fiduciary under this
chapter, the Secretary shall provide such beneficiary with a written
statement detailing the reasons for such determination.
``(2) A beneficiary whom the Secretary has determined to be
mentally incompetent for purposes of appointing a fiduciary under this
chapter may appeal such determination.
``(c) Modification.--(1) A beneficiary for whom the Secretary
appoints a fiduciary under this chapter may, at any time, request the
Secretary to--
``(A) remove the fiduciary so appointed; and
``(B) have a new fiduciary appointed.
``(2) The Secretary shall comply with a request under paragraph (1)
unless the Secretary determines that the request is not made in good
faith.
``(3) The Secretary shall ensure that any removal or new
appointment of a fiduciary under paragraph (1) does not delay or
interrupt the beneficiary's receipt of benefits administered by the
Secretary.
``(d) Independence.--A fiduciary appointed by the Secretary shall
operate independently of the Department to determine the actions that
are in the interest of the beneficiary.
``(e) Predesignation.--A veteran may predesignate a fiduciary by--
``(1) submitting written notice to the Secretary of the
predesignated fiduciary; or
``(2) submitting a form provided by the Secretary for such
purpose.
``(f) Appointment of Non-Predesignated Fiduciary.--If a beneficiary
designates an individual to serve as a fiduciary under subsection (e)
and the Secretary appoints an individual not so designated as the
fiduciary for such beneficiary, the Secretary shall notify such
beneficiary of--
``(1) the reason why such designated individual was not
appointed; and
``(2) the ability of the beneficiary to modify the
appointed fiduciary under subsection (c).
``(g) Priority of Appointment.--In appointing a fiduciary under
this chapter, if a beneficiary does not designate a fiduciary pursuant
to subsection (e), to the extent possible the Secretary shall appoint a
person who is--
``(1) a relative of the beneficiary;
``(2) appointed as guardian of the beneficiary by a court
of competent jurisdiction; or
``(3) authorized to act on behalf of the beneficiary under
a durable power of attorney.''.
(2) Clerical amendment.--The table of sections at the
beginning of chapter 55 of title 38, United States Code, is
amended by striking the item relating to section 5502 and
inserting the following:
``5502. Appointment of fiduciaries.''.
(b) Supervision.--
(1) In general.--Chapter 55 of title 38, United States
Code, is amended by inserting after section 5502, as amended by
subsection (a)(1), the following new section:
``Sec. 5502A. Supervision of fiduciaries
``(a) Commission.--(1)(A) In a case in which the Secretary
determines that a commission is necessary in order to obtain the
services of a fiduciary in the best interests of a beneficiary, the
Secretary may authorize a fiduciary appointed by the Secretary to
obtain from the monthly benefits provided to the beneficiary a
reasonable commission for fiduciary services rendered, but the
commission for any month may not exceed the lesser of the following
amounts:
``(i) The amount that equals three percent of the
monthly monetary benefits under laws administered by
the Secretary paid on behalf of the beneficiary to the
fiduciary.
``(ii) $35.
``(B) A commission paid under this paragraph may not be derived
from any award to a beneficiary regarding back pay or retroactive
benefits payments.
``(C) A commission may not be authorized for a fiduciary who
receives any other form of remuneration or payment in connection with
rendering fiduciary services for benefits under this title on behalf of
the beneficiary.
``(D) In accordance with section 6106 of this title, a commission
may not be paid to a fiduciary if the Secretary determines that the
fiduciary misused any benefit payments of a beneficiary.
``(E) If the Secretary determines that the fiduciary has misused
any benefit or payments of a beneficiary, the Secretary may revoke the
fiduciary status of the fiduciary.
``(2) Where, in the opinion of the Secretary, any fiduciary
receiving funds on behalf of a Department beneficiary is acting in such
a number of cases as to make it impracticable to conserve properly the
estates or to supervise the persons of the beneficiaries, the Secretary
may refuse to make future payments in such cases as the Secretary may
deem proper.
``(b) Court.--Whenever it appears that any fiduciary, in the
opinion of the Secretary, is not properly executing or has not properly
executed the duties of the trust of such fiduciary or has collected or
paid, or is attempting to collect or pay, fees, commissions, or
allowances that are inequitable or in excess of those allowed by law
for the duties performed or expenses incurred, or has failed to make
such payments as may be necessary for the benefit of the ward or the
dependents of the ward, then the Secretary may appear, by the
Secretary's authorized attorney, in the court which has appointed such
fiduciary, or in any court having original, concurrent, or appellate
jurisdiction over said cause, and make proper presentation of such
matters. The Secretary, in the Secretary's discretion, may suspend
payments to any such fiduciary who shall neglect or refuse, after
reasonable notice, to render an account to the Secretary from time to
time showing the application of such payments for the benefit of such
incompetent or minor beneficiary, or who shall neglect or refuse to
administer the estate according to law. The Secretary may require the
fiduciary, as part of such account, to disclose any additional
financial information concerning the beneficiary (except for
information that is not available to the fiduciary). The Secretary may
appear or intervene by the Secretary's duly authorized attorney in any
court as an interested party in any litigation instituted by the
Secretary or otherwise, directly affecting money paid to such fiduciary
under this section.
``(c) Payment of Certain Expenses.--Authority is hereby granted for
the payment of any court or other expenses incident to any
investigation or court proceeding for the appointment of any fiduciary
or other person for the purpose of payment of benefits payable under
laws administered by the Secretary or the removal of such fiduciary and
appointment of another, and of expenses in connection with the
administration of such benefits by such fiduciaries, or in connection
with any other court proceeding hereby authorized, when such payment is
authorized by the Secretary.
``(d) Temporary Payment of Benefits.--All or any part of any
benefits the payment of which is suspended or withheld under this
section may, in the discretion of the Secretary, be paid temporarily to
the person having custody and control of the incompetent or minor
beneficiary, to be used solely for the benefit of such beneficiary, or,
in the case of an incompetent veteran, may be apportioned to the
dependent or dependents, if any, of such veteran. Any part not so paid
and any funds of a mentally incompetent or insane veteran not paid to
the chief officer of the institution in which such veteran is a patient
nor apportioned to the veteran's dependent or dependents may be ordered
held in the Treasury to the credit of such beneficiary. All funds so
held shall be disbursed under the order and in the discretion of the
Secretary for the benefit of such beneficiary or the beneficiary's
dependents. Any balance remaining in such fund to the credit of any
beneficiary may be paid to the beneficiary if the beneficiary recovers
and is found competent, or if a minor, attains majority, or otherwise
to the beneficiary's fiduciary, or, in the event of the beneficiary's
death, to the beneficiary's personal representative, except as
otherwise provided by law; however, payment will not be made to the
beneficiary's personal representative if, under the law of the
beneficiary's last legal residence, the beneficiary's estate would
escheat to the State. In the event of the death of a mentally
incompetent or insane veteran, all gratuitous benefits under laws
administered by the Secretary deposited before or after August 7, 1959,
in the personal funds of patients trust fund on account of such veteran
shall not be paid to the personal representative of such veteran, but
shall be paid to the following persons living at the time of
settlement, and in the order named: The surviving spouse, the children
(without regard to age or marital status) in equal parts, and the
dependent parents of such veteran, in equal parts. If any balance
remains, such balance shall be deposited to the credit of the
applicable current appropriation; except that there may be paid only so
much of such balance as may be necessary to reimburse a person (other
than a political subdivision of the United States) who bore the
expenses of last sickness or burial of the veteran for such expenses.
No payment shall be made under the two preceding sentences of this
subsection unless claim therefor is filed with the Secretary within
five years after the death of the veteran, except that, if any person
so entitled under said two sentences is under legal disability at the
time of death of the veteran, such five-year period of limitation shall
run from the termination or removal of the legal disability.
``(e) Escheatment.--Any funds in the hands of a fiduciary appointed
by a State court or the Secretary derived from benefits payable under
laws administered by the Secretary, which under the law of the State
wherein the beneficiary had last legal residence would escheat to the
State, shall escheat to the United States and shall be returned by such
fiduciary, or by the personal representative of the deceased
beneficiary, less legal expenses of any administration necessary to
determine that an escheat is in order, to the Department, and shall be
deposited to the credit of the applicable revolving fund, trust fund,
or appropriation.''.
(2) Clerical amendment.--The table of sections at the
beginning of chapter 55 of title 38, United States Code, is
amended by inserting after the item relating to section 5502
the following new item:
``5502A. Supervision of fiduciaries.''.
(c) Definition of Fiduciary.--Section 5506 of title 38, United
States Code is amended--
(1) by striking ``For purposes'' and inserting ``(a) For
purposes''; and
(2) by adding at the end the following new subsection:
``(b)(1) For purposes of subsection (a), the term `person' includes
any--
``(A) State or local government agency whose mission is to
carry out income maintenance, social service, or health care-
related activities;
``(B) any State or local government agency with fiduciary
responsibilities; or
``(C) any nonprofit social service agency that the
Secretary determines--
``(i) regularly provides services as a fiduciary
concurrently to five or more individuals; and
``(ii) is not a creditor of any such individual.
``(2) The Secretary shall maintain a list of State or local
agencies and nonprofit social service agencies under paragraph (1) that
are qualified to act as a fiduciary under this chapter. In maintaining
such list, the Secretary may consult the lists maintained under section
807(h) of the Social Security Act (42 U.S.C. 1007(h)).''.
(d) Qualifications.--Section 5507 of title 38, United States Code,
is amended to read as follows:
``Sec. 5507. Inquiry, investigations, and qualification of fiduciaries
``(a) Investigation.--Any certification of a person for payment of
benefits of a beneficiary to that person as such beneficiary's
fiduciary under section 5502 of this title shall be made on the basis
of--
``(1) an inquiry or investigation by the Secretary of the
fitness of that person to serve as fiduciary for that
beneficiary to be conducted in advance of such certification
and in accordance with subsection (b);
``(2) adequate evidence that certification of that person
as fiduciary for that beneficiary is in the interest of such
beneficiary (as determined by the Secretary under regulations);
``(3) adequate evidence that the person to serve as
fiduciary protects the private information of a beneficiary in
accordance with subsection (d)(1); and
``(4) the furnishing of any bond that may be required by
the Secretary, in accordance with subsection (f).
``(b) Elements of Investigation.--(1) In conducting an inquiry or
investigation of a proposed fiduciary under subsection (a)(1), the
Secretary shall conduct--
``(A) a face-to-face interview with the proposed fiduciary
by not later than 30 days after the date on which such inquiry
or investigation begins; and
``(B) a background check of the proposed fiduciary to--
``(i) in accordance with paragraph (2), determine
whether the proposed fiduciary has been convicted of a
crime; and
``(ii) determine whether the proposed fiduciary
will serve the best interest of the beneficiary,
including by conducting a credit check of the proposed
fiduciary and checking the records under paragraph (5).
``(2) The Secretary shall request information concerning whether
that person has been convicted of any offense under Federal or State
law. If that person has been convicted of such an offense, the
Secretary may certify the person as a fiduciary only if the Secretary
finds that the person is an appropriate person to act as fiduciary for
the beneficiary concerned under the circumstances.
``(3) The Secretary shall conduct the background check described in
paragraph (1)(B)--
``(A) each time a person is proposed to be a fiduciary,
regardless of whether the person is serving or has served as a
fiduciary; and
``(B) at no expense to the beneficiary.
``(4) Each proposed fiduciary shall disclose to the Secretary the
number of beneficiaries that the fiduciary acts on behalf of.
``(5) The Secretary shall maintain records of any person who has--
``(A) previously served as a fiduciary; and
``(B) had such fiduciary status revoked by the Secretary.
``(6)(A) If a fiduciary appointed by the Secretary is convicted of
a crime described in subparagraph (B), the Secretary shall notify the
beneficiary of such conviction by not later than 14 days after the date
on which the Secretary learns of such conviction.
``(B) A crime described in this subparagraph is a crime--
``(i) for which the fiduciary is convicted while serving as
a fiduciary for any person;
``(ii) that is not included in a report submitted by the
fiduciary under section 5509(a) of this title; and
``(iii) that the Secretary determines could affect the
ability of the fiduciary to act on behalf of the beneficiary.
``(c) Investigation of Certain Persons.--(1) In the case of a
proposed fiduciary described in paragraph (2), the Secretary, in
conducting an inquiry or investigation under subsection (a)(1), may
carry out such inquiry or investigation on an expedited basis that may
include giving priority to conducting such inquiry or investigation.
Any such inquiry or investigation carried out on such an expedited
basis shall be carried out under regulations prescribed for purposes of
this section.
``(2) Paragraph (1) applies with respect to a proposed fiduciary
who is--
``(A) the parent (natural, adopted, or stepparent) of a
beneficiary who is a minor;
``(B) the spouse or parent of an incompetent beneficiary;
``(C) a person who has been appointed a fiduciary of the
beneficiary by a court of competent jurisdiction;
``(D) being appointed to manage an estate where the annual
amount of veterans benefits to be managed by the proposed
fiduciary does not exceed $3,600, as adjusted pursuant to
section 5312 of this title; or
``(E) a person who is authorized to act on behalf of the
beneficiary under a durable power of attorney.
``(d) Protection of Private Information.--(1) A fiduciary shall
take all reasonable precautions to--
``(A) protect the private information of a beneficiary,
including personally identifiable information; and
``(B) securely conducts financial transactions.
``(2) A fiduciary shall notify the Secretary of any action of the
fiduciary that compromises or potentially compromises the private
information of a beneficiary.
``(e) Potential Misuse of Funds.--(1) If the Secretary has reason
to believe that a fiduciary may be misusing all or part of the benefit
of a beneficiary, the Secretary shall--
``(A) conduct a thorough investigation to determine the
veracity of such belief; and
``(B) if such veracity is established, transmit to the
officials described in paragraph (2) a report of such
investigation.
``(2) The officials described in this paragraph are the following:
``(A) The Attorney General.
``(B) Each head of a Federal department or agency that pays
to a fiduciary or other person benefits under any law
administered by such department of agency for the use and
benefit of a minor, incompetent, or other beneficiary.
``(f) Bond.--In requiring the furnishing of a bond under subsection
(a)(4), the Secretary shall--
``(1) ensure that any such bond is not paid using any funds
of the beneficiary; and
``(2) consider--
``(A) the care a proposed fiduciary has taken to
protect the interests of the beneficiary; and
``(B) the capacity of the proposed fiduciary to
meet the financial requirements of the bond without
sustaining hardship.
``(g) List of Fiduciaries.--Each regional office of the Veterans
Benefits Administration shall maintain a list of the following:
``(1) The name and contact information of each fiduciary,
including address, telephone number, and email address.
``(2) With respect to each fiduciary described in paragraph
(1)--
``(A) the date of the most recent background check
and credit check performed by the Secretary under this
section;
``(B) the date that any bond was paid under this
section;
``(C) the name, address, and telephone number of
each beneficiary the fiduciary acts on behalf of; and
``(D) the amount that the fiduciary controls with
respect to each beneficiary described in subparagraph
(C).''.
(e) Annual Receipt of Payments.--
(1) In general.--Section 5509 of title 38, United States
Code, is amended--
(A) in subsection (a)----
(i) by striking ``may require a fiduciary
to file a'' and inserting ``, subject to
regulations prescribed pursuant to subsection
(f), shall require a fiduciary to file an
annual''; and
(ii) by adding at the end the following new
sentence: ``The Secretary shall transmit such
annual report or accounting to the beneficiary
and any legal guardian of such beneficiary.'';
(B) by adding at the end the following new
subsections:
``(c) Matters Included.--An annual report or accounting under
subsection (a) shall include the following:
``(1) For each beneficiary that a fiduciary acts on behalf
of--
``(A) the amount of the benefits of the beneficiary
accrued during the year, the amount spent, and the
amount remaining; and
``(B) if the fiduciary serves the beneficiary with
respect to benefits not administered by the Secretary,
an accounting of all sources of benefits or other
income the fiduciary oversees for the beneficiary.
``(2) A list of events that occurred during the year
covered by the report that could affect the ability of the
fiduciary to act on behalf of the beneficiary, including--
``(A) the fiduciary being convicted of any crime;
``(B) the fiduciary declaring bankruptcy; and
``(C) any judgments entered against the fiduciary.
``(d) Random Audits.--The Secretary shall annually conduct random
audits of fiduciaries who receive a commission pursuant to subsection
5502A(a)(1) of this title.
``(e) Status of Fiduciary.--If a fiduciary includes in the annual
report events described in subsection (c)(2), the Secretary may take
appropriate action to adjust the status of the fiduciary as the
Secretary determines appropriate, including by revoking the fiduciary
status of the fiduciary.
``(f) Regulations.--(1) In prescribing regulations to carry out
this section, the Secretary, in consultation with the Under Secretary
for Benefits and the Under Secretary for Health, shall ensure that the
care provided by a fiduciary described in paragraph (2) to a
beneficiary is not diminished or otherwise worsened by the fiduciary
complying with this section.
``(2) A fiduciary described in this paragraph is a fiduciary who,
in addition to acting as a fiduciary for a beneficiary, provides care
to the beneficiary pursuant to this title (including such care provided
under section 1720G of this title).''; and
(C) by striking the section heading and inserting
the following: ``Annual reports and accountings of
fiduciaries''.
(2) Clerical amendment.--The table of sections at the
beginning of chapter 55 of title 38, United States Code, is
amended by striking the item relating to section 5509 and
inserting the following new item:
``5509. Annual reports and accountings of fiduciaries.''.
(f) Repayment of Misused Benefits.--Section 6107(a)(2)(C) of title
38, United States Code, is amended by inserting before the period the
following: ``, including by the Secretary not acting in accordance with
section 5507 of this title''.
(g) Annual Reports.--Section 5510 of title 38, United States Code,
is amended by striking ``The Secretary shall include in the Annual
Benefits Report of the Veterans Benefits Administration or the
Secretary's Annual Performance and Accountability Report'' and
inserting ``Not later than July 1 of each year, the Secretary shall
submit to the Committees on Veterans' Affairs of the House of
Representatives and the Senate a separate report containing''.
(h) Report.--Not later than one year after the date of the
enactment of this Act, the Secretary of Veterans Affairs shall submit
to the Committee on Veterans' Affairs of the Senate and the Committee
on Veterans' Affairs of the House of Representatives a comprehensive
report on the implementation of the amendments made by this Act,
including--
(1) detailed information on the establishment of new
policies and procedures pursuant to such amendments and
training provided on such policies and procedures; and
(2) a discussion of whether the Secretary should provide
fiduciaries with standardized financial software to simplify
reporting requirements.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Veterans' Affairs.
Referred to the Subcommittee on Disability Assistance and Memorial Affairs.
Subcommittee Hearings Held.
Subcommittee Consideration and Mark-up Session Held.
Forwarded by Subcommittee to Full Committee by Voice Vote .
Llama 3.2 · runs locally in your browser
Ask anything about this bill. The AI reads the full text to answer.
Enter to send · Shift+Enter for new line