This week, a Get Wise. Get Rich. Get Out. reader shared their Claim Shark story with me and has generously allowed me to write about it on this blog! Let’s call him Thomas.
Thomas, a fellow Air Force veteran, recently applied for VA disability benefits. He had been warned by his coworkers against going through a Veteran Service Organization. Unfortunately, his coworkers had not had good experiences and instead recommended Trajector Medical, a private company based out of Gainesville, Florida. While their website does offer “Free Medical Evaluations,” the price for consulting on Thomas’s VA disability claim ended up being a cool $7,000. But, “If you don’t get paid, we don’t get paid,” they promised.
They provided consultation services as advertised, but Thomas was required to submit his claim directly to the VA and provide Trajector Medical updates on VA communications, effectively a “go between.” Shortly after beginning to make payments on his $7,000 bill, he started to fall behind on their agreed payment plan, but stayed in regular contact with Trajector Medical. Very quickly, the company started harassing him to collect payments, using intimidating debt collection tactics which became increasingly disruptive to his life.
Fed up, Thomas did some digging and learned Trajector Medical is not accredited by the VA to represent claimants in the preparation, presentation, and prosecution of their VA claims–hence why Trajector Medical would not communicate directly with the VA on Thomas’s behalf. Moreover, VA accredited agents cannot, by law, charge Veterans a fee for assisting in the initial VA claim process.
Thomas quickly emailed the company, calling out their unethical, borderline illegal practices, demanded they cease and desist the harassment, and demanded they waive the remainder of his bill–which was over $5,000. Without contest, the company agreed to all terms and has since stopped contacting him.
While Thomas still lost some money, and some pride in the process, he successfully escaped, what’s called in the VA claims community, a Claim Shark. He wants other Veterans to know their rights.
Who Might be Claim Sharks?
According to the Veterans of Foreign Wars, they think the Claim Sharks are:
What is Title 38?
The legal code in question here is Title 38, the United States Code of Federal Regulations which governs Veterans affairs and the administration of pension, bonuses, and Veteran’s relief. For reference, it also defines Veteran status.
Under US Code Title 38, Section 5901, “no individual may act as an agent or attorney in the preparation, presentation, or prosecution of any claim under laws administered by the Secretary [of Veterans Affairs] unless such individual has been recognized for such purposes.”
The VA has a well-established process, for recognizing or “accrediting” (1) Veteran Service Organizations, (2) attorneys, and (3) claims agents to act as an agent, or attorney, in the preparation, presentation, or prosecution of VA claims.
Veteran Service Organizations (VSO), specifically, are chartered by Congress to support Veterans, including in accessing benefits administered by the VA. The complete list of Congressionally-chartered VSOs can be found at the House Committee on Veterans’ Affairs Veteran Service Organization page.
The criteria for becoming a VA accredited agent can be found in Title 38, Section 14.628. Most notably, under Title 38, Section 5902, a condition of VA accreditation is that “no fee or compensation of any nature will be charged any individual for services rendered in connection with any claim.”
In other words, it is against US law to represent an individual in the preparation, presentation, or prosecution of any VA claim without VA accreditation. Moreover, it is against the law for VA-accredited organizations to charge a fee for this service, at least for initial claims. Under Title 38, Section 5904, the VA does allow VA-accredited agents or attorneys to charge a fee for VA appeals support, but places limits on allowable fees.
At first glance, it may appear as though Claim Sharks are obviously engaging in illegal activities by virtue of charging a fee for their VA claim consulting services. However, these companies are able to skirt the law specifically because they are not accredited by the VA and therefore not subject to the same legal–or ethical–stipulations. Moreover, by marketing their services as “consulting” or “coaching” rather than “representing” or “acting as an agent,” they are able to narrowly evade legal recourse.
Remember, Trajector Medical never represented Thomas to the VA, rather they only helped him prepare his claim documentation, which he then filed himself. If this sounds like a loophole and not at all in line with the spirit of the law, many Congressmen would agree with you.
H.R. 1139 S.740 GUARD VA Benefits Act of 2023
Recently the Senate and House introduced H.R.1139 S.740 – GUARD VA Benefits Act of 2023, or “Governing Unaccredited Representatives Defrauding VA Benefits Act”. If passed, this legislation to make this practice–providing VA claim assistance without VA accreditation–a criminal offense. The full verbiage is below.
This bill imposes criminal penalties on individuals for directly or indirectly soliciting, contracting for, charging, or receiving any unauthorized fee or compensation with respect to the preparation, presentation, or prosecution of any claim for Department of Veterans Affairs benefits. The commission or attempted commission of such offenses is punishable by a fine, imprisonment for up to one year, or both.
S.740 – GUARD VA Benefits Act of 2023
If you support this legislation, please write your endorsement to your Congressmen! The Veterans of Foreign Wars already has a convenient “Stop Claim Sharks Now” Action Center portal.
What’s so Dangerous about Seeking Non-VA Accredited Consulting Services?
Many of these VA claim “consulting” or “coaching” companies claim they provide a critical, under-available service for Veterans. Perhaps they are providing that service as advertised. If a Veteran is willing to pay for it, then what’s the big deal?
The big deal is two fold. By operating outside of government regulation these companies can (1) more easily engage in predatory, unethical practices, and (2) evade legal recourse from Veterans victim to these unethical practices.
Since Claim Sharks are not subject to regulation under Title 38, they can more easily get away with misleading advertising and fee structures. In their September 2023 Fraud Alert, the VA Office of General Counsel advises Veterans that it’s “not appropriate for any unaccredited “claims consultants” or representatives to charge veterans a percentage of future payments or fees to assist with filing initial benefit claims.” The VA also warns these “claims consultants” may promise the Veteran access to private health care providers who will increase their chances for a higher disability rating, exagerate their conditions, or even “find a diagnosis.”
Most alarming, the VA warns that Veterans should never agree to directly deposit their VA benefit payments into the bank account of a claims consultant–which begs the question, are some Claim Sharks actually doing this?!
According to the Veterans of Foreign Wars, Claim Sharks often charge five times the veteran’s awarded monthly VA disability pay. This means a 70% VA disability rating award with a monthly $1,716.28 compensation, as of 2024, will incur a $8,581.40 bill. You may also be on the hook for any subsequent VA disability rating increases, regardless of whether that company assisted you in that rating increase.
All this to say, Veterans who do business with “claims consultants” are far more likely to fall victim to a VA benefit fraud scam, since these companies operate outside of VA standards of ethics.
Protect yourself!
Use a VA-accredited VSO, attorney, or agent for help filing your VA claims!
Find one at the Department of the Veteran’s Affairs Accreditation Search.
You have a Right to No-Fee VA Claims Assistance
Let me make something clear. You should not have to pay a dime for assistance in filing your VA disability claim. Under current US Code, you have a right to receive VA disability claim assistance at no cost through a Veteran Service Organization or other accredited attorney or claims agent.
While not all Veteran Service Organizations are created equal, if you are dissatisfied with the quality of service, go to a different VSO–there are over 100 of them! If you don’t want to use a government resource, work with a private, VA-accredited attorney or claims agent.
How to Report a Claim Shark
The Federal Trade Commission is responsible to “investigate and prevent unfair methods of competition, and unfair or deceptive acts or practices affecting commerce.” You can report a Claim Shark through their Report Fraud portal.
Service members, veterans, and military families have a special Fraud Reporting portal, click Report Here.
How to File a Complaint Against a VA-Accredited Agent
If you have a complaint against a VA-accredited Veteran Service Organization, attorney, or claims agent, you can contact the VA Office of General Counsel. The OSD is responsible for ensuring the “just and faithful execution of the laws, regulations and policies that the Secretary has responsibility for administering.”
Unfortunately I couldn’t find an online complaint option. Rather, you must write a letter of your complaint, include a completed VA Form 3822 (to release your information in order to investigate your complaint), and send it to the following address:
Office of General Counsel (022D)
Department of Veterans Affairs
810 Vermont Avenue, NW
Washington, DC 20420
You can find more information on the VA’s Office of General Counsel, Accreditation, Discipline, & Fees Program site.
Conclusion
You have a right to quality, no-fee VA claims assistance service protected under US Code Title 38. In fact, the VA has an entire program to recognize and regulate agents and attorneys to support you. VA “claims consultants” or Claim Sharks understand the value of your benefits and currently use predatory, unethical practices to tap into your benefits including misleading, excessive fee structures, falsely promising access to special healthcare providers, harassing debt collection tactics, and maybe even asking you to directly deposit your VA benefit into their bank account.
If you or someone you know has been targeted by a Claim Shark, report them to the Federal Trade Commission.
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