,i #aacth ,,congress #ast ,session ,h4 ,r4 #hid ,,in ,,the ,,house ,,of ,,representatives ,february #bh1 #bjac ,mr4 ,johnson of ,ohio 7for himself1 ,mr4 ,stivers1 ,ms4 ,titus1 and ,mr4 ,roe of ,tennessee7 introduced the following bill2 which was referred to the ,committee on ,veterans' ,affairs ,a ,,bill ,to amend title #ch1 ,united ,states ,code1 to improve the supervision of fiduciaries of veterans under the laws administered by the ,secretary of ,veterans ,affairs4 #a4 ,improvement of fiduciaries for veterans 7a7 ,appointment and supervision 7#a7 ,section #eejb of title #ch1 ,united ,states ,code1 is amended to read as follows3 #eejb4 ,appointment of fiduciaries 7a7 ,appointment 7#a7 ,where it appears to the ,secretary that the interest of the beneficiary would be served thereby1 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 beneficiary1 regardless of any legal disability on the part of the beneficiary4 7#b7 ,when in the opinion of the ,secretary1 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 misuse1 the ,secretary may appoint one or more temporary fiduciaries for a period not to exceed #abj days4 ,if a final decision has not been made within #abj days1 the ,secretary may not continue the appointment of the fiduciary without obtaining a court order for appointment of a guardian1 conservator1 or other fiduciary under the authority provided in section #eejb7;b7 of this title4 7b7 ,appeals 7#a7 ,if the ,secretary determines a beneficiary to be mentally incompetent for purposes of appointing a fiduciary under this chapter1 the ,secretary shall provide such beneficiary with a written statement detailing the reasons for such determination4 7#b7 ,a beneficiary whom the ,secretary has determined to be mentally incompetent for purposes of appointing a fiduciary under this chapter may appeal such determination4 7c7 ,modification 7#a7 ,a beneficiary for whom the ,secretary appoints a fiduciary under this chapter may1 at any time1 request the ,secretary to-- 7,a7 remove the fiduciary so appointed2 and 7,b7 have a new fiduciary appointed4 7#b7 ,the ,secretary shall comply with a request under paragraph 7#a7 unless the ,secretary determines that the request is not made in good faith4 7#c7 ,the ,secretary shall ensure that any removal or new appointment of a fiduciary under paragraph 7#a7 does not delay or interrupt the beneficiary's receipt of benefits administered by the ,secretary4 7d7 ,independence ,a fiduciary appointed by the ,secretary shall operate independently of the ,department to determine the actions that are in the interest of the beneficiary4 7e7 ,predesignation ,a veteran may predesignate a fiduciary by-- 7#a7 submitting written notice to the ,secretary of the predesignated fiduciary2 or 7#b7 submitting a form provided by the ,secretary for such purpose4 7f7 ,appointment of non-,predesignated fiduciary ,if a beneficiary designates an individual to serve as a fiduciary under subsection 7e7 and the ,secretary appoints an individual not so designated as the fiduciary for such beneficiary1 the ,secretary shall notify such beneficiary of-- 7#a7 the reason why such designated individual was not appointed2 and 7#b7 the ability of the beneficiary to modify the appointed fiduciary under subsection 7c74 7g7 ,priority of appointment ,in appointing a fiduciary under this chapter1 if a beneficiary does not designate a fiduciary pursuant to subsection 7e71 to the extent possible the ,secretary shall appoint a person who is-- 7#a7 a relative of the beneficiary2 7#b7 appointed as guardian of the beneficiary by a court of competent jurisdiction2 or 7#c7 authorized to act on behalf of the beneficiary under a durable power of attorney4 4 7#b7 ,clerical amendment ,the table of sections at the beginning of chapter #ee of title #ch1 ,united ,states ,code1 is amended by striking the item relating to section #eejb and inserting the following3 #eejb4 ,appointment of fiduciaries4 4 7b7 ,supervision 7#a7 ,in general ,chapter #ee of title #ch1 ,united ,states ,code1 is amended by inserting after section #eejb1 as amended by subsection 7a77#a71 the following new section3 #eejb;,a4 ,supervision of fiduciaries 7a7 ,commission 7#a7 7,a7 ,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 beneficiary1 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 rendered1 but the commission for any month may not exceed the lesser of the following amounts3 7i7 ,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 fiduciary4 7ii7 #ce4 7,b7 ,a commission paid under this paragraph may not be derived from any award to a beneficiary regarding back pay or retroactive benefits payments4 7,c7 ,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 beneficiary4 7,d7 ,in accordance with section #fajf of this title1 a commission may not be paid to a fiduciary if the ,secretary determines that the fiduciary misused any benefit payments of a beneficiary4 7,e7 ,if the ,secretary determines that the fiduciary has misused any benefit or payments of a beneficiary1 the ,secretary may revoke the fiduciary status of the fiduciary4 7#b7 ,where1 in the opinion of the ,secretary1 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 beneficiaries1 the ,secretary may refuse to make future payments in such cases as the ,secretary may deem proper4 7b7 ,court ,whenever it appears that any fiduciary1 in the opinion of the ,secretary1 is not properly executing or has not properly executed the duties of the trust of such fiduciary or has collected or paid1 or is attempting to collect or pay1 fees1 commissions1 or allowances that are inequitable or in excess of those allowed by law for the duties performed or expenses incurred1 or has failed to make such payments as may be necessary for the benefit of the ward or the dependents of the ward1 then the ,secretary may appear1 by the ,secretary's authorized attorney1 in the court which has appointed such fiduciary1 or in any court having original1 concurrent1 or appellate jurisdiction over said cause1 and make proper presentation of such matters4 ,the ,secretary1 in the ,secretary's discretion1 may suspend payments to any such fiduciary who shall neglect or refuse1 after reasonable notice1 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 beneficiary1 or who shall neglect or refuse to administer the estate according to law4 ,the ,secretary may require the fiduciary1 as part of such account1 to disclose any additional financial information concerning the beneficiary 7except for information that is not available to the fiduciary74 ,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 otherwise1 directly affecting money paid to such fiduciary under this section4 7c7 ,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 another1 and of expenses in connection with the administration of such benefits by such fiduciaries1 or in connection with any other court proceeding hereby authorized1 when such payment is authorized by the ,secretary4 7d7 ,temporary payment of benefits ,all or any part of any benefits the payment of which is suspended or withheld under this section may1 in the discretion of the ,secretary1 be paid temporarily to the person having custody and control of the incompetent or minor beneficiary1 to be used solely for the benefit of such beneficiary1 or1 in the case of an incompetent veteran1 may be apportioned to the dependent or dependents1 if any1 of such veteran4 ,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 beneficiary4 ,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 dependents4 ,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 competent1 or if a minor1 attains majority1 or otherwise to the beneficiary's fiduciary1 or1 in the event of the beneficiary's death1 to the beneficiary's personal representative1 except as otherwise provided by law2 however1 payment will not be made to the beneficiary's personal representative if1 under the law of the beneficiary's last legal residence1 the beneficiary's estate would escheat to the ,state4 ,in the event of the death of a mentally incompetent or insane veteran1 all gratuitous benefits under laws administered by the ,secretary deposited before or after ,august #g1 #aiei1 in the personal funds of patients trust fund on account of such veteran shall not be paid to the personal representative of such veteran1 but shall be paid to the following persons living at the time of settlement1 and in the order named3 ,the surviving spouse1 the children 7without regard to age or marital status7 in equal parts1 and the dependent parents of such veteran1 in equal parts4 ,if any balance remains1 such balance shall be deposited to the credit of the applicable current appropriation2 except that there may be paid only so much of such balance as may be necessary to reimburse a person 7other than a political subdivision of the ,united ,states7 who bore the expenses of last sickness or burial of the veteran for such expenses4 ,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 veteran1 except that1 if any person so entitled under said two sentences is under legal disability at the time of death of the veteran1 such five-year period of limitation shall run from the termination or removal of the legal disability4 7e7 ,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 ,secretary1 which under the law of the ,state wherein the beneficiary had last legal residence would escheat to the ,state1 shall escheat to the ,united ,states and shall be returned by such fiduciary1 or by the personal representative of the deceased beneficiary1 less legal expenses of any administration necessary to determine that an escheat is in order1 to the ,department1 and shall be deposited to the credit of the applicable revolving fund1 trust fund1 or appropriation4 4 7#b7 ,clerical amendment ,the table of sections at the beginning of chapter #ee of title #ch1 ,united ,states ,code1 is amended by inserting after the item relating to section #eejb the following new item3 #eejb;,a4 ,supervision of fiduciaries4 4 7c7 ,definition of fiduciary ,section #eejf of title #ch1 ,united ,states ,code is amended-- 7#a7 by striking ,for purposes and inserting 7a7 ,for purposes2 and 7#b7 by adding at the end the following new subsection3 7b7 7#a7 ,for purposes of subsection 7a71 the term person includes any-- 7,a7 ,state or local government agency whose mission is to carry out income maintenance1 social service1 or health care-related activities2 7,b7 any ,state or local government agency with fiduciary responsibilities2 or 7,c7 any nonprofit social service agency that the ,secretary determines-- 7i7 regularly provides services as a fiduciary concurrently to five or more individuals2 and 7ii7 is not a creditor of any such individual4 7#b7 ,the ,secretary shall maintain a list of ,state or local agencies and nonprofit social service agencies under paragraph 7#a7 that are qualified to act as a fiduciary under this chapter4 ,in maintaining such list1 the ,secretary may consult the lists maintained under section #hjg7;h7 of the ,social ,security ,act 7#db ,u4,s4,c4 #ajjg7;h774 4 7d7 ,qualifications ,section #eejg of title #ch1 ,united ,states ,code1 is amended to read as follows3 #eejg4 ,inquiry1 investigations1 and qualification of fiduciaries 7a7 ,investigation ,any certification of a person for payment of benefits of a beneficiary to that person as such beneficiary's fiduciary under section #eejb of this title shall be made on the basis of-- 7#a7 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 7b72 7#b7 adequate evidence that certification of that person as fiduciary for that beneficiary is in the interest of such beneficiary 7as determined by the ,secretary under regulations72 7#c7 adequate evidence that the person to serve as fiduciary protects the private information of a beneficiary in accordance with subsection 7d77#a72 and 7#d7 the furnishing of any bond that may be required by the ,secretary1 in accordance with subsection 7f74 7b7 ,elements of investigation 7#a7 ,in conducting an inquiry or investigation of a proposed fiduciary under subsection 7a77#a71 the ,secretary shall conduct-- 7,a7 a face-to-face interview with the proposed fiduciary by not later than #cj days after the date on which such inquiry or investigation begins2 and 7,b7 a background check of the proposed fiduciary to-- 7i7 in accordance with paragraph 7#b71 determine whether the proposed fiduciary has been convicted of a crime2 and 7ii7 determine whether the proposed fiduciary will serve the best interest of the beneficiary1 including by conducting a credit check of the proposed fiduciary and checking the records under paragraph 7#e74 7#b7 ,the ,secretary shall request information concerning whether that person has been convicted of any offense under ,federal or ,state law4 ,if that person has been convicted of such an offense1 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 circumstances4 7#c7 ,the ,secretary shall conduct the background check described in paragraph 7#a77;,b7-- 7,a7 each time a person is proposed to be a fiduciary1 regardless of whether the person is serving or has served as a fiduciary2 and 7,b7 at no expense to the beneficiary4 7#d7 ,each proposed fiduciary shall disclose to the ,secretary the number of beneficiaries that the fiduciary acts on behalf of4 7#e7 ,the ,secretary shall maintain records of any person who has-- 7,a7 previously served as a fiduciary2 and 7,b7 had such fiduciary status revoked by the ,secretary4 7#f7 7,a7 ,if a fiduciary appointed by the ,secretary is convicted of a crime described in subparagraph 7,b71 the ,secretary shall notify the beneficiary of such conviction by not later than #ad days after the date on which the ,secretary learns of such conviction4 7,b7 ,a crime described in this subparagraph is a crime-- 7i7 for which the fiduciary is convicted while serving as a fiduciary for any person2 7ii7 that is not included in a report submitted by the fiduciary under section #eeji7;a7 of this title2 and 7iii7 that the ,secretary determines could affect the ability of the fiduciary to act on behalf of the beneficiary4 7c7 ,investigation of certain persons 7#a7 ,in the case of a proposed fiduciary described in paragraph 7#b71 the ,secretary1 in conducting an inquiry or investigation under subsection 7a77#a71 may carry out such inquiry or investigation on an expedited basis that may include giving priority to conducting such inquiry or investigation4 ,any such inquiry or investigation carried out on such an expedited basis shall be carried out under regulations prescribed for purposes of this section4 7#b7 ,paragraph 7#a7 applies with respect to a proposed fiduciary who is-- 7,a7 the parent 7natural1 adopted1 or stepparent7 of a beneficiary who is a minor2 7,b7 the spouse or parent of an incompetent beneficiary2 7,c7 a person who has been appointed a fiduciary of the beneficiary by a court of competent jurisdiction2 7,d7 being appointed to manage an estate where the annual amount of veterans benefits to be managed by the proposed fiduciary does not exceed #c1fjj1 as adjusted pursuant to section #ecab of this title2 or 7,e7 a person who is authorized to act on behalf of the beneficiary under a durable power of attorney4 7d7 ,protection of private information 7#a7 ,a fiduciary shall take all reasonable precautions to-- 7,a7 protect the private information of a beneficiary1 including personally identifiable information2 and 7,b7 securely conducts financial transactions4 7#b7 ,a fiduciary shall notify the ,secretary of any action of the fiduciary that compromises or potentially compromises the private information of a beneficiary4 7e7 ,potential misuse of funds 7#a7 ,if the ,secretary has reason to believe that a fiduciary may be misusing all or part of the benefit of a beneficiary1 the ,secretary shall-- 7,a7 conduct a thorough investigation to determine the veracity of such belief2 and 7,b7 if such veracity is established1 transmit to the officials described in paragraph 7#b7 a report of such investigation4 7#b7 ,the officials described in this paragraph are the following3 7,a7 ,the ,attorney ,general4 7,b7 ,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 minor1 incompetent1 or other beneficiary4 7f7 ,bond ,in requiring the furnishing of a bond under subsection 7a77#d71 the ,secretary shall-- 7#a7 ensure that any such bond is not paid using any funds of the beneficiary2 and 7#b7 consider-- 7,a7 the care a proposed fiduciary has taken to protect the interests of the beneficiary2 and 7,b7 the capacity of the proposed fiduciary to meet the financial requirements of the bond without sustaining hardship4 7g7 ,list of fiduciaries ,each regional office of the ,veterans ,benefits ,administration shall maintain a list of the following3 7#a7 ,the name and contact information of each fiduciary1 including address1 telephone number1 and email address4 7#b7 ,with respect to each fiduciary described in paragraph 7#a7-- 7,a7 the date of the most recent background check and credit check performed by the ,secretary under this section2 7,b7 the date that any bond was paid under this section2 7,c7 the name1 address1 and telephone number of each beneficiary the fiduciary acts on behalf of2 and 7,d7 the amount that the fiduciary controls with respect to each beneficiary described in subparagraph 7,c74 4 7e7 ,annual receipt of payments 7#a7 ,in general ,section #eeji of title #ch1 ,united ,states ,code1 is amended-- 7,a7 in subsection 7a7---- 7i7 by striking may require a fiduciary to file a and inserting 1 subject to regulations prescribed pursuant to subsection 7f71 shall require a fiduciary to file an annual2 and 7ii7 by adding at the end the following new sentence3 ,the ,secretary shall transmit such annual report or accounting to the beneficiary and any legal guardian of such beneficiary42 7,b7 by adding at the end the following new subsections3 7c7 ,matters included ,an annual report or accounting under subsection 7a7 shall include the following3 7#a7 ,for each beneficiary that a fiduciary acts on behalf of-- 7,a7 the amount of the benefits of the beneficiary accrued during the year1 the amount spent1 and the amount remaining2 and 7,b7 if the fiduciary serves the beneficiary with respect to benefits not administered by the ,secretary1 an accounting of all sources of benefits or other income the fiduciary oversees for the beneficiary4 7#b7 ,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 beneficiary1 including-- 7,a7 the fiduciary being convicted of any crime2 7,b7 the fiduciary declaring bankruptcy2 and 7,c7 any judgments entered against the fiduciary4 7d7 ,random audits ,the ,secretary shall annually conduct random audits of fiduciaries who receive a commission pursuant to subsection #eejb;,a7a77#a7 of this title4 7e7 ,status of fiduciary ,if a fiduciary includes in the annual report events described in subsection 7c77#b71 the ,secretary may take appropriate action to adjust the status of the fiduciary as the ,secretary determines appropriate1 including by revoking the fiduciary status of the fiduciary4 7f7 ,regulations 7#a7 ,in prescribing regulations to carry out this section1 the ,secretary1 in consultation with the ,under ,secretary for ,benefits and the ,under ,secretary for ,health1 shall ensure that the care provided by a fiduciary described in paragraph 7#b7 to a beneficiary is not diminished or otherwise worsened by the fiduciary complying with this section4 7#b7 ,a fiduciary described in this paragraph is a fiduciary who1 in addition to acting as a fiduciary for a beneficiary1 provides care to the beneficiary pursuant to this title 7including such care provided under section #agbj;,g of this title74 2 and 7,c7 by striking the section heading and inserting the following3 ,annual reports and accountings of fiduciaries4 7#b7 ,clerical amendment ,the table of sections at the beginning of chapter #ee of title #ch1 ,united ,states ,code1 is amended by striking the item relating to section #eeji and inserting the following new item3 #eeji4 ,annual reports and accountings of fiduciaries4 4 7f7 ,repayment of misused benefits ,section #fajg7;a77#b77;,c7 of title #ch1 ,united ,states ,code1 is amended by inserting before the period the following3 1 including by the ,secretary not acting in accordance with section #eejg of this title4 7g7 ,annual reports ,section #eeaj of title #ch1 ,united ,states ,code1 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 #a of each year1 the ,secretary shall submit to the ,committees on ,veterans' ,affairs of the ,house of ,representatives and the ,senate a separate report containing4 7h7 ,report ,not later than one year after the date of the enactment of this ,act1 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 ,act1 including-- 7#a7 detailed information on the establishment of new policies and procedures pursuant to such amendments and training provided on such policies and procedures2 and 7#b7 a discussion of whether the ,secretary should provide fiduciaries with standardized financial software to simplify reporting requirements4