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Stronger rules urged for veteran fiduciaries

Jun. 20, 2012 - 04:39PM   |   Last Updated: Jun. 20, 2012 - 04:39PM  |  
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Efforts are underway to strengthen oversight of the fiduciaries appointed to handle the affairs of mentally incapable veterans — without making the rules so strict that family members are discouraged or prevented from taking on that role.

After some fiduciaries were found to be stealing benefits, failing to pay essential bills and even have criminal backgrounds, veterans advocates, Congress and the Veterans Affairs Department made it a goal to improve the program, which covers 125,000 veterans that VA has determined are unable to handle their own finances.

Ralph Ibson of the nonprofit Wounded Warrior Project said June 20 that the fiduciary program has "serious problems and weaknesses" that need to be addressed, especially in cases where a family member is acting as a full-time caregiver for a severely disabled veteran.

Ibson said he is concerned that some pending proposals calling for background checks and more accountability in how veterans' benefits are spent could be too great a burden for people who are already stressed.

He hopes accountability can be made "less intrusive" for someone who already should have earned VA's trust.

Caregivers already find the program's current audits to be too much to handle, he said. For example, the mother of a disabled veteran was asked why she allowed the veteran to spend so much on Christmas gifts. Another caregiver was told by an auditor not to run the air conditioner at night in their Florida home to save money. Another caregiver was questioned for spending money on movies and music for a veteran with brain injuries.

The chief proposal in Congress for strengthening rules is the Veterans Fiduciary Reform Act of 2012, sponsored by Rep. Bill Johnson, R-Ohio, chairman of the House Veterans' Affairs Committee's oversight and investigations panel.

Johnson said veterans in the program must be protected, noting that many have difficulty challenging the decision that they are unable to handle their own finances, or to get their fiduciary replaced.

His bill, HR 5948, would require background checks for fiduciaries managing veterans' funds, limit how much a fiduciary can be paid, allow veterans to pre-designate who they would prefer to handle their financial affairs, require veterans to be notified of the criminal background of their fiduciary, and set up a streamlined process to fire a fiduciary if a veteran believes he is being cheated.

Ibson isn't the only one with questions. Lauren Kologe of Vietnam Veterans of America says she understands why criminal background checks are required, but she wonders how far it needs to go.

"We appreciate keeping criminals away from our most vulnerable veterans and dependents," she said. However, the bill seems to require that a veteran be told if their fiduciary has been convicted of even minor traffic violations.

Kologe also believes VA needs a whistleblower program to accept anonymous complaints about fiduciaries misusing funds or abusing the veterans they are supposed to help.

Johnson indicated he was willing to adjust the legislation, but he re-emphasized that the program needs change.

Current law gives VA a lot of flexibility in managing the program, and "VA has stretched that flexibility in every direction," Johnson said. "The result has been unconscionable treatment of some of our most vulnerable veterans."

David McLenachen, director of VA's pension and fiduciary service, said VA doesn't support Johnson's bill but "does recognize the need for better oversight of the fiduciary program" and is willing to work with Johnson on modifications. Ë

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