S-4646-119
Read twice and referred to the Committee on Veterans' Affairs.
Sponsored by Richard Blumenthal (D-CT)
What it does
This bill would reinstate criminal penalties — fines and up to one year in prison — for anyone who charges veterans unauthorized fees to help prepare, file, or pursue VA benefits claims. It would also require the VA to maintain a searchable online list of accredited and suspended claims representatives, add warnings to VA websites about predatory fee practices, require VA claim forms to ask whether claimants paid for filing assistance, ban automated robocalls to federal agencies made by third parties, and direct the VA to build a reliable accreditation system for agents and attorneys who assist veterans with claims.
Who benefits
Veterans filing VA benefits claims, particularly those who are elderly, have cognitive disabilities, or lack familiarity with the VA system and may be more vulnerable to predatory fee schemes. Accredited veterans service organizations (VSOs) and legitimate VA-accredited attorneys and agents who compete against unaccredited fee-chargers. Veterans who have already been defrauded and would gain a clearer reporting mechanism. Federal agencies broadly, who would be protected from automated robocall campaigns by third parties.
Who is hurt
Third-party claims assistance companies — sometimes called "claims sharks" or veterans benefits consultants — that currently charge fees outside the VA accreditation system and would face criminal liability. Unaccredited individuals who informally help veterans file claims for compensation, even if not acting predatorily, and who would be barred without VA recognition. States whose laws on fee agreements for VA claims representation would be preempted by the federal standard. The VA itself would bear new administrative and technology costs to build and maintain the required accreditation system and online tools.
Supporters argue
Supporters argue that a 2006 federal court decision effectively eliminated criminal penalties that had long protected veterans from predatory fee-charging, opening the door to a growing industry of unaccredited companies that charge veterans hundreds or thousands of dollars for claims assistance that accredited VSOs provide for free. They contend that reinstating these penalties closes a specific legal gap, that veterans — many of whom are elderly or disabled — are disproportionately targeted by such schemes, and that the bill's transparency tools (searchable accreditation lists, website warnings, and claim-form disclosures) give veterans the information needed to protect themselves before harm occurs.
Opponents argue
Opponents argue that broadly restricting who may assist veterans with claims — and criminalizing unauthorized fee arrangements — could reduce the overall supply of claims assistance, particularly in rural or underserved areas where accredited VSOs and attorneys are scarce. They contend that some unaccredited consultants provide genuine value and that veterans, as legal adults, should retain the right to choose and pay for representation. Critics may also argue that the bill's preemption of state law on fee agreements is an overreach that displaces state consumer protection frameworks without demonstrating that federal enforcement will be more effective.