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Steps To Take When A VA Fiduciary Assignment Is Determined To Be Inappropriate
by Jim Strickland
Introduction
The Department of Veterans Affairs maintains a program to assign individuals to safeguard the interests of the financial affairs of veterans deemed incompetent to do so for themselves. This program is often referred to as the fiduciary program.
A fiduciary is, “the highest standard of care at either equity or law. A fiduciary (abbreviation fid) is expected to be extremely loyal to the person to whom he owes the duty (the "principal"): he must not put his personal interests before the duty, and must not profit from his position as a fiduciary, unless the principal consents.”
The GAO explains the VA fiduciary program like this; “Many individuals receiving monthly compensation and pension benefits from the Department of Veterans Affairs (VA) have mental impairments that prevent them from managing their finances. VA’s Fiduciary Program selects and oversees third parties, called fiduciaries, to help manage and protect beneficiaries’ funds.”
In many instances, the assignment of a fiduciary is entirely necessary and appropriate to protect the veteran. It is incumbent upon VA to investigate the action thoroughly and fairly and to make a responsible appointment with the safety and well being of the veteran always in clear focus.
§13.64 Fiduciary commissions.
“Generally, a VA appointed fiduciary is to be encouraged to serve without fee.”
It is unfortunate that this isn’t always what happens. Recently, VA has been criticized as falling far short of their mandate.
GAO has reported the VA fiduciary program is in “disarray” and that “staff said that they did not always comply with VA policies”. VAOIG has reported similar findings. VA appointed fiduciaries have been found stealing from the veterans they were supposed to be guarding. See below:
GAO: VA'S FIDUCIARY PROGRAM IN DISARRAY, BENEFITS NOT SAFEGUARDED -- Fiduciary Program managers and staff said that they did not always comply with VA policies due, in part, to a lack of time, resources, and staff.
VAOIG AUDIT FINDS VA'S FIDUCIARY PROGRAM PUTS VETS' FUNDS AT RISK -- Inspector General found that VBA's Fiduciary Program is not effectively protecting the VA-derived income and estates of incompetent beneficiaries.
VA FIDUCIARY AND WIFE STEAL $2 MILLION FROM INCOMPETENT VETERANS -- A 26-count indictment charged the couple with conspiracy, misappropriation by a fiduciary, making materially false statements to a federal agency and tax fraud.
Horror Story:
The veteran is often ill equipped to resist these appointments. Attorneys often find VA to be non-responsive to any inquiry regarding the appointment and the fiduciaries are often equally non-responsive.
For these reasons a team of advocates volunteered to work together to develop a plan of what we consider best practices for advocates to follow as they work to assist the veteran who suffers from the wrongful assignment of a VA appointed fiduciary.
This document is the result of the teamwork by those advocates.
Following the points below is not a guarantee of success. However, we believe that the advocate who patiently works to apply the principles of this methodical approach will find that there will eventually be a response that will prove positive for the veteran.
Methods
If a fiduciary already has been assigned:
1. Write a formal letter (everything sent certified return receipt and copies maintained) to the fiduciary, identifying yourself, your relationship to the veteran (relative, POA, etc.) and requesting a response to your concern or concerns in 14-21 days. (See sample letter at the end of the article.)
2. If no response/poor response; send another letter attaching a copy of the first and informing the fiduciary that you are copying VA regional office and VA Regional Counsel (see listing at bottom of page) because he/she did not respond to first letter and request response in 14 days.
3. If no response; send third letter copying VARO and VA General Counsel and VAOIG. Also file a complaint with state bar (if lawyer) or other professional licensing organization (for CPAs, bankers). If all else fails, send a copy to the State Attorney General or Secretary of State's office.
4. If more than 4% of the monthly deposit is being removed or health and safety is being jeopardized, contact local law enforcement and register a complaint. When filing such a complaint, stress that you believe this is a case of theft, conversion, or fraud. A report of this sort is evidence of concern that may be useful in later civil action.
5. File a Petition with the Court of Appeals for Veterans Claims seeking protection. An attorney familiar with the petition process is optimal for such action but the Court has often accepted simple letters as “petitions” and has even arranged for representation in meritorious cases.
6. Ultimately, make the fiduciary as an individual or corporation the target of legal action. Bypassing the VA places the fiduciary in a position of proving their compliance with any applicable local laws that may govern their practice. The fiduciary is ultimately responsible to their ward, not to the VA.
If a fiduciary is proposed or newly assigned:
1. Immediately file a Notice of Disagreement with fiduciary assignment. This should be written as a standard sort of NOD and requesting a personal hearing and so on.
2. Send letter to fiduciary requesting professional qualifications for being appointed fiduciary and challenging assignment.
3. Upon first questionable action - immediately write all the letters described above.
4. If no response in 30 days -file a petition with Veterans Court seeking protection.
5. Letters directed only to the fiduciary from an advocate are most likely to get a response. An attorney who is not certified to practice before VA is acceptable to write such letters.
Fiduciaries are often governed by state law--typically trust as a part of trust or agency law. The particular hammer with a fiduciary is they can be personally liable if they have misused funds, so they will be very, very sensitive in that regard.
A strong letter--”this is to put you on notice”, and cc the appropriate governing agency, bank trust department is likely to bring that fiduciary to call the VARO very quickly.
Copy notices to VA Regional Counsel in the case of whatever documents are sent to the VARO. Regional Counsel is who the local VARO will first turn to.
Overall
Consider how the determination of incompetence was made. Consider due process violations.
Title 38 - Chapter I Part 3 - 3.353
Determinations of incompetency and competency.
(3)(e) Due process. Whenever it is proposed to make an incompetency determination, the beneficiary will be notified of the proposed action and of the right to a hearing as provided in 3.103. Such notice is not necessary if the beneficiary has been declared incompetent by a court of competent jurisdiction or if a guardian has been appointed for the beneficiary based upon a court finding of incompetency. If a hearing is requested it must be held prior to a rating decision of incompetency.
Conclusion
By following this simple plan, we believe that the veterans advocate will achieve a productive dialogue with the VA and the fiduciary.
-----------------------------------------------------------
Update
My articles addressing the issue of the VA fiduciary appointment (see inset above) brought a blizzard of email to my desk. From highly sophisticated law offices to spirit-broken veterans, I’ve received a lot of comments.
One surprise I had was that some states allow (encourage?) the state’s Department of Veterans Affairs to establish a fiduciary department. The federal DVA will then assign the fiduciary appointment to the state who assigns an employee to act as fiduciary.
I’m currently investigating what appears to be a particularly abusive case in Florida and the evidence against the state’s appointed fiduciary is mounting. There is very little published about the relationship of the federal VA to the state VA and any exchange of money that may occur as in the traditional VA fiduciary appointment.
These are the sorts of things your VA (state and federal) likes to keep off your radar whenever possible.
I’ll report that to you as I learn more. Make a note that working with an incompetent state employee acting as a VA fiduciary may prove to be more complex than dealing with a civilian appointee.
As of the weekend after the two part series ran, our veteran's wife and heroine of Part 2, Vicki Olson, notified me that she received a call on Sunday from VA that her veteran's competency was suddenly restored. Mike Olson was ecstatic that VA had made it clear that he was rated competent and that no further fiduciary action was planned.
Jim
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EDITED by Larry Scott
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Addenda
Sample letter to fiduciary
Listing of VA regional counsel
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Sample Letter
May 9, 2010
Ms Joan O. Arc, Trust Officer
The Anybody Bank Bank
5555 N. North Street
Anywhere, Anytime 12345-6789
Re: Veteran John Q Sixpak
Dear Ms. Arc;
I represent veteran Sixpak.
According to the correspondence to you from Mr. Lord O. Rings, Veteran Service Center Manager, VA Regional Office, you were appointed as fiduciary over veteran Sixpak’s Department of Veterans Affairs benefits.
Although there has been no court determination of the veterans incompetence, you entered into an agreement with VA to accept a fee for your services.
Unfortunately, in your date e-mail correspondence to Mr. Sixpak, you indicate that you are a fiduciary for the Veterans Administration, not Mr. Sixpak.
Once the funds reach your bank, you become the fiduciary for Mr. Sixpak, not the Department of Veterans Affairs .
Mr. Sixpak has forwarded bills to you, but you have been delinquent in paying those bills. For instance, the Sixpaks have sent you their utility bill immediately upon receipt. You will note that City Utilities sent them a Final Notice Prior To Disconnection as a result of your failure to make timely payments. The Sixpaks sent you a copy of the invoice for their motor vehicle insurance. You failed to pay that invoice on time, which resulted in the enclosed Notice of Cancellation.
In addition, on June 19,2010 Mr. Sixpak requested you to pay for his daughter's insurance co-pay. Without citing any applicable law, you refused to pay the dependent's co-pay insurance.
Prior to your appointment, these bills, as well as all other bills, were being paid on time by the Sixpaks.
Your failure to make timely payments of veteran Sixpak’s necessary and ordinary living expenses have created undue hardship, and may adversely affect their current credit rating. Mr. Sixpak has a copy of his credit report if you care to see it. I am not certain you have legal authority to access it on your own.
I request that you contact me if I have inaccurately stated any fact in this letter, and specifically indicate which facts I have misrepresented. If I do not hear from you in 14 days or less, I will proceed under the basis that you failed in your lawful assigned duties to timely pay Mr. Sixpak’s legitimate living expenses and advise him accordingly.
Very truly yours,
Veterans Advocate, Attorney
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Regional Council
OFFICE OF GENERAL COUNSEL
REGIONAL COUNSEL OFFICES & AREA OFFICES
_______________
REGION 1 Edward J. Lukey, Regional Counsel
BOSTON VA Medical Center (518/02) Phone: (781) 687-3600
Regional Counsel Fax: (781) 687-3626
200 Springs Road, Building 61
Bedford, MA 01730
Hartford 555 Willard Avenue
Newington, CT 06111
Manchester 275 Chestnut Street
Manchester, NH 03101-2487
Providence Westminster Mall
Providence, RI 02903
Togus Building 205, Room 336
Togus, ME 04330
_______________
REGION 2 Max D. Shemtob, Regional Counsel
BROOKLYN VA Medical Center (630/02) Phone: (718) 630-2901
Regional Counsel
Fax: (718) 630-2917
800 Poly Place, Bldg. 14
Brooklyn, NY 11209
Newark 20 Washington Place
Newark, NJ 07202
REGION 3 Frank Giorno, Regional Counsel
WASHINGTON VA Regional Office (372/02) Phone: (202) 530-9420
1722 I Street, NW, 3rd floor Washington, DC 20421
Fax: (202) 530-9431
Baltimore 3900 Loch Raven
Building 4
Baltimore, MD 21218
_______________
REGION 4 José H. Lopez, Regional Counsel
PHILADELPHIA VA Medical Center. (642/02) Phone: (215) 823-7811
3900 Woodland Avenue
Philadelphia, PA 19104
Fax: (215) 823-7821
Pittsburgh 7180 Highland Drive
Pittsburgh, PA 15206-1297
_______________
REGION 5 William M. Thigpen, III, Regional Counsel
ATLANTA Regional Counsel (316/02) Phone: (404) 929-5851
1700 Clairmont Road
Decatur, GA 30033-4032
Fax: (404) 929-5870
Columbia 6439 Garners Ferry Road
Columbia, SC 29209-1639
_______________
REGION 6 K. Sue Meyer, Regional Counsel
BAY PINES Regional Counsel (516/02) Phone: (727) 398-9390
P.O. Box 5005
Building 22, Room 333
Bay Pines, FL 33744-5005
Fax: (727) 398-9384
San Juan 10 Calle Casia
San Juan, PR 00921-3201
West Palm Beach 7305 N. Military Trail
West Palm Beach, FL 33410-6400
Gainesville 1601 SW Archer Road
Gainesville, FL 32608
Miami 1201 NW 16th Street
Miami, FL 33125
_______________
REGION 7 Donald A. Adams, Regional Counsel
CLEVELAND Regional Counsel (541/02) Phone: (440) 717-2883
10000 Brecksville Road Fax: (440) 717-2884
Bldg. 1, Fifth Floor
Brecksville, OH 44141
Huntington 1540 Spring Valley Drive
Huntington, WV 25704
Huntington 640 Fourth Avenue
Huntington, WV 25701
Cincinnati 3200 Vine Street
Cincinnati, OH 45220
Dayton 4100 W. 3rd Street
Dayton, OH 45428
_______________
REGION 8 Ronald H. Dooley, Regional Counsel
NASHVILLE Regional Counsel (320/02) Phone: (615) 695-4633
3322 West End Avenue
Suite 509
Nashville, TN 37203
Fax: (615) 695-4634
N. Little Rock 2200 Fort Roots Drive, Bldg. 5
North Little Rock, AR 72114
_______________
REGION 9 Mary E. “Betty” Barrett, Regional Counsel
JACKSON Regional Counsel (586/02) Phone: (601) 364-1261
1500 E. Woodrow Wilson Dr.
Jackson, MS 39216-5199
Fax: (601) 364-1263
Montgomery 345 Perry Hill Road
Montgomery, AL 36109-4551
_______________
REGION 10 Earl E. Parsons - Regional Counsel
CHICAGO/HINES Regional Counsel (57----8/02) Phone: (708) 202-2216
Bldg. 1-G131
PO Box 1427
Hines, IL 60141
Fax: (708) 202-2239
Des Moines
210 Walnut Street, Rm. 989
Des Moines, IA 50309
_______________
REGION 11 Roland L. Bessette, Regional Counsel
DETROIT Regional Counsel (329/02) Phone: (313) 471-3644
Patrick V. McNamara Federal Bldg. 477 Michigan Ave., Suite 1460
Detroit, MI 48226-2591
Fax: (313) 226-4994
Milwaukee
5400 West National Avenue
Milwaukee, WI 53214
_______________
REGION 12 Patrick J. Wiese, Regional Counsel
ST. LOUIS VA Medical Center (657/02) Phone: (314) 845-5050
Regional Counsel
Fax: (314) 845-5057
1 Jefferson Barracks Drive
Building 25, Room 308
St. Louis, MO 63125-4185
Lincoln 5631 S. 48th Street, Room 262
Lincoln, NE 68516-4198
Wichita 5500 E. Kellogg, Room B8B
Wichita, KS 67218-1698
Omaha 4101 Woolworth Avenue
Omaha, NE 68105
Kansas City 1201 Walnut Street
Suite 800
Kansas City, MO 64106
_______________
REGION 13 Nancy Canonico, Regional Counsel
WACO Regional Counsel (674A4/02) Phone: (254) 297-5300
Department of Veterans Affairs Fax: (254) 297-5310
4800 Memorial Drive, Building 12 Waco, TX 76711
Fax2: (254) 297-5344
Muskogee 1012 Honor Heights, Bldg.12
Muskogee, OK 74401
Dallas 4500 South Lancaster Road
Dallas, TX 75216
Temple 1902 Veterans Memorial Drive
Temple, TX 76704
Oklahoma City 921 N.E. 13th Street
Oklahoma City, OK 73104
Austin 1625 Woodward Street
Austin, TX 78772-0001
_______________
REGION 14 Logan A. Slaughter, Regional Counsel
HOUSTON Regional Counsel (362/02) Phone: (713) 794-3656
6900 Almeda Road
Houston, TX 77030-4200
Fax: (713) 794-3753
New Orleans 701 Loyola Avenue
New Orleans, LA 70113
Shreveport 510 E. Stoner Avenue
Shreveport, LA 71101
San Antonio 7400 Merton Minter Blvd.
San Antonio, TX 78284
_______________
REGION 15 Susan K. Savela, Regional Counsel
MINNEAPOLIS Regional Counsel (618/02) Phone: (612) 467-5900
VA Medical Center
One Veterans Drive, Bldg. 73
Minneapolis, MN 55417
Fax: (612) 467-5928
Fargo 2101 Elm Street
Fargo, ND 58102
Sioux Falls 2501 W. 22nd St.
Sioux Falls, SD 57105
_______________
REGION 16 Michael E. Bornhouser, Regional Counsel
DENVER Regional Counsel (339/02) Phone: (303) 914-5810
PO Box 25126
155 Van Gordon Street, Suite 551
Lakewood, CO 80228
Fax: (303) 914-5849
Cheyenne 2360 E. Pershing Blvd.
Cheyenne, WY 82001
Fort Harrison Fort Harrison, MT 59636
Salt Lake City 550 Foothill Boulevard
Salt Lake City, UT 84158
_______________
REGION 18 Suzanne Will, Regional Counsel
SAN FRANCISCO VA Medical Center Phone: (415) 750-2288
Fax: (415) 750-2255
Regional Counsel (662/02)
4150 Clement Street, Bldg. 210
San Francisco, CA 94121-1563
Honolulu 459 Patterson Road
Honolulu, HI 96819-1522
Los Angeles 11000 Wilshire Blvd.
Los Angeles, CA 90024
San Diego 8810 Rio San Diego Drive
San Diego, CA 92108-01622
_______________
REGION 19 Gregory Ferris, Regional Counsel
PHOENIX Regional Counsel (644/02) Phone: (602) 212-2091/92
3225 N. Central Ave., Rm. 305 Fax: (602) 640-4744
PO Box 34327 (602) 212-2144
Phoenix, AZ 85067-4237
Reno 1000 Locust Street
Reno, NV 89520
Albuquerque 2100 Ridgecrest Drive, SE
Albuquerque, NM 87108
_______________
REGION 20 Michael P. McCarthy, Regional Counsel
PORTLAND VA Regional Office (348/02) Phone: (503) 326-2441
Fax: (503) 326-3550
1220 SW Third Avenue, #1224
Portland, OR 97204
Boise 805 W. Franklin Street
Boise, Idaho 83702-5560
Seattle 915 Second Avenue
1386 Federal Building
Seattle, Washington 98174
Anchorage 2925 DeBarr Road
Anchorage, AK 99508
_______________
REGION 21 Joseph Moreno, Regional Counsel
BUFFALO Regional Counsel (528/02) Phone: (716) 862-8854
120 LeBrun
Buffalo, NY 14215
Fax: (700) 432-6545
Albany 113 Holland Avenue
Albany, NY 12208
Syracuse 800 Irving Avenue
Syracuse, NY 13210
White River Junction
215 North Main Street
White River Jct, VT 05009-0001
_______________
REGION 22 John A. Houff, Regional Counsel
INDIANAPOLIS VA Regional Office (326/02) Phone: (317) 226-7876
Fax: (317) 226-6297
Regional Counsel
575 N. Pennsylvania St., Rm. 309
Indianapolis, IN 46204
Louisville 545 S. 3rd Street, Room 303
Louisville, KY 40202
800 Zorn Avenue
Room A181
Louisville, KY 40206-1499
Lexington 110 W. Vine Street, Suite 400
Lexington, KY 40511
_______________
REGION 23 D. Edison Sessoms, Regional Counsel
WINSTON-SALEM Regional Counsel (318/02) Phone: (336) 631-5014
Fax: (336) 631-5041
Department of Veterans Affairs
Hiram H. Ward Federal Building
251 N. Main Street
Winston-Salem, NC 27101
Roanoke 210 Franklin Road, SW
Roanoke, Virginia 24011
