IIB 

113TH CONGRESS 

1ST SESSION H. R. 1405 

IN THE SENATE OF THE UNITED STATES 

OCTOBER 29, 2013 

Received; read twice and referred to the Committee on Veterans’ Affairs 

AN ACT 

To amend title 38, United States Code, to require the Secretary of Veterans Affairs to include a notice of disagreement form in any notice of decision issued for the denial 

of a benefit sought, to improve the supervision of fiduciaries of veterans under the laws administered by the 

Secretary of Veterans Affairs, and for other purposes. 


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1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. INCLUSION OF NOTICE OF DISAGREEMENT 

4 FORMS IN NOTICES OF DECISIONS OF BENE5 FITS DENIALS ISSUED BY SECRETARY OF 

6 VETERANS AFFAIRS. 

7 (a) IN GENERAL.—Section 5104(b) of title 38, 

8 United States Code, is amended— 

9 (1) by striking ‘‘and (2)’’ and inserting ‘‘(2)’’; 

10 and 

11 (2) by inserting before the period at the end the 

12 following: ‘‘, and (3) a form that may be used to file 

13 a notice of disagreement to the decision’’. 

14 (b) EFFECTIVE DATE.—The amendments made by 

15 subsection (a) shall apply with respect to decisions made 

16 by the Secretary under section 511 of title 38, United 

17 States Code, on or after the date of the enactment of this 

18 Act. 

19 SEC. 2. PROVISION OF STATUS UNDER LAW BY HONORING 

20 CERTAIN MEMBERS OF THE RESERVE COM21 PONENTS AS VETERANS. 

22 (a) VETERAN STATUS.— 

23 (1) IN GENERAL.—Chapter 1 of title 38, United 

24 States Code, is amended by inserting after section 

25 107 the following new section: 


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1 ‘‘§ 107A. Honoring as veterans certain persons who 

2 performed service in the reserve compo3 nents 

4 ‘‘Any person who is entitled under chapter 1223 of 

5 title 10 to retired pay for nonregular service or, but for 

6 age, would be entitled under such chapter to retired pay 

7 for nonregular service shall be honored as a veteran but 

8 shall not be entitled to any benefit by reason of this sec9 tion.’’. 

10 (2) CLERICAL AMENDMENT.—The table of sec11 tions at the beginning of such chapter is amended 

12 by inserting after the item relating to section 107 

13 the following new item: 

‘‘107A. Honoring as veterans certain persons who performed service in the reserve components.’’. 

14 (b) CLARIFICATION REGARDING BENEFITS.—No 

15 person may receive any benefit under the laws adminis16 tered by the Secretary of Veterans Affairs solely by reason 

17 of section 107A of title 38, United States Code, as added 

18 by subsection (a). 

19 SEC. 3. PROVISION OF ACCESS TO CASE-TRACKING INFOR20 MATION. 

21 (a) IN GENERAL.—Chapter 59 of title 38, United 

22 States Code, is amended by adding at the end the fol23 lowing: 


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1 ‘‘§ 5906. Provision of access to case-tracking informa2 tion 

3 ‘‘(a) IN GENERAL.—(1) In accordance with sub4 section (b), the Secretary shall provide a covered employee 

5 with access to the case-tracking system to provide a vet6 eran with information regarding the status of a claim sub7 mitted by such veteran if such employee is acting under 

8 written permission or a power of attorney executed by 

9 such veteran. 

10 ‘‘(2) In providing a covered employee with access to 

11 the case-tracking system under paragraph (1), the Sec12 retary shall ensure— 

13 ‘‘(A) that such access— 

14 ‘‘(i) is provided in a manner that does not 

15 allow such employee to modify the data con16 tained in such system; and 

17 ‘‘(ii) does not include access to medical 

18 records; and 

19 ‘‘(B) that each time a covered employee ac20 cesses such system, the employee must certify that 

21 such access is for official purposes only. 

22 ‘‘(b) PRIVACY CERTIFICATION COURSE.—The Sec23 retary may not provide a covered employee with access to 

24 the case-tracking system under subsection (a)(1) unless 

25 the covered employee has successfully completed a certifi26 cation course on privacy issues provided by the Secretary. 


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1 ‘‘(c) TREATMENT OF DISCLOSURE.—The access to 

2 information by a covered employee pursuant to subsection 

3 (a)(1) shall be deemed to be— 

4 ‘‘(1) a covered disclosure under section 552a(b) 

5 of title 5; and 

6 ‘‘(2) a permitted disclosure under regulations 

7 promulgated under section 264(c) of the Health In8 surance Portability and Accountability Act of 1996 

9 (42 U.S.C. 1320d–2 note). 

10 ‘‘(d) DEFINITIONS.—In this section: 

11 ‘‘(1) The term ‘case-tracking system’ means the 

12 system of the Department of Veterans Affairs that 

13 provides information regarding the status of a claim 

14 submitted by a veteran. 

15 ‘‘(2) The term ‘covered employee’ means an em16 ployee of a State or local governmental agency (in17 cluding a veterans service officer) who, in the course 

18 of carrying out the responsibilities of such employ19 ment, assists veterans with claims for any benefit 

20 under the laws administered by the Secretary.’’. 

21 (b) CLERICAL AMENDMENT.—The table of sections 

22 at the beginning of such chapter is amended by adding 

23 at the end the following new item: 

‘‘5906. Provision of access to case-tracking information.’’. 

24 SEC. 4. IMPROVEMENT OF FIDUCIARIES FOR VETERANS. 

25 (a) APPOINTMENT AND SUPERVISION.— 


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1 (1) Section 5502 of title 38, United States 

2 Code, is amended to read as follows: 

3 ‘‘§ 5502. Appointment of fiduciaries 

4 ‘‘(a) APPOINTMENT.—(1) Where it appears to the 

5 Secretary that the interest of the beneficiary would be 

6 served thereby, payment of benefits under any law admin7 istered by the Secretary may be made directly to the bene8 ficiary or to a relative or some other fiduciary for the use 

9 and benefit of the beneficiary, regardless of any legal dis10 ability on the part of the beneficiary. 

11 ‘‘(2) When in the opinion of the Secretary, a tem12 porary fiduciary is needed in order to protect the benefits 

13 provided to the beneficiary under any law administered by 

14 the Secretary while a determination of incompetency is 

15 being made or appealed or a fiduciary is appealing a deter16 mination of misuse, the Secretary may appoint one or 

17 more temporary fiduciaries for a period not to exceed 120 

18 days. If a final decision has not been made within 120 

19 days, the Secretary may not continue the appointment of 

20 the fiduciary without obtaining a court order for appoint21 ment of a guardian, conservator, or other fiduciary under 

22 the authority provided in section 5502(b) of this title. 

23 ‘‘(b) APPEALS.—(1) If the Secretary determines a 

24 beneficiary to be mentally incompetent for purposes of ap25 pointing a fiduciary under this chapter, the Secretary shall 


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1 provide such beneficiary with a written statement detailing 

2 the reasons for such determination. 

3 ‘‘(2) A beneficiary whom the Secretary has deter4 mined to be mentally incompetent for purposes of appoint5 ing a fiduciary under this chapter may appeal such deter6 mination. 

7 ‘‘(c) MODIFICATION.—(1) A beneficiary for whom the 

8 Secretary appoints a fiduciary under this chapter may, at 

9 any time, request the Secretary to— 

10 ‘‘(A) remove the fiduciary so appointed; and 

11 ‘‘(B) have a new fiduciary appointed. 

12 ‘‘(2) The Secretary shall comply with a request under 

13 paragraph (1) if the Secretary determines that the request 

14 is made in good faith and— 

15 ‘‘(A) the fiduciary requested to be removed re16 ceives a fee from the beneficiary and a suitable vol17 unteer fiduciary is available to assist the beneficiary; 

18 or 

19 ‘‘(B) the beneficiary provides credible informa20 tion that the fiduciary requested to be removed is— 

21 ‘‘(i) not acting in the interest of the bene22 ficiary; or 

23 ‘‘(ii) unable to effectively serve the bene24 ficiary because of an irreconcilable personality 

25 conflict or disagreement. 


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1 ‘‘(3) The Secretary shall ensure that any removal or 

2 new appointment of a fiduciary under paragraph (1) does 

3 not delay or interrupt the beneficiary’s receipt of benefits 

4 administered by the Secretary. 

5 ‘‘(d) INDEPENDENCE.—A fiduciary appointed by the 

6 Secretary shall operate independently of the Department 

7 to determine the actions that are in the interest of the 

8 beneficiary. 

9 ‘‘(e) PREDESIGNATION.—A veteran may predesignate 

10 a fiduciary by— 

11 ‘‘(1) submitting written notice to the Secretary 

12 of the predesignated fiduciary; or 

13 ‘‘(2) submitting a form provided by the Sec14 retary for such purpose. 

15 ‘‘(f) APPOINTMENT OF NON-PREDESIGNATED FIDU16 CIARY.—If a beneficiary designates an individual to serve 

17 as a fiduciary under subsection (e) and the Secretary ap18 points an individual not so designated as the fiduciary for 

19 such beneficiary, the Secretary shall notify such bene20 ficiary of— 

21 ‘‘(1) the reason why such designated individual 

22 was not appointed; and 

23 ‘‘(2) the ability of the beneficiary to modify the 

24 appointed fiduciary under subsection (c). 


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1 ‘‘(g) PRIORITY OF APPOINTMENT.—In appointing a 

2 fiduciary under this chapter, if a beneficiary does not des3 ignate a fiduciary pursuant to subsection (e), to the extent 

4 possible the Secretary shall appoint a person who is— 

5 ‘‘(1) a relative of the beneficiary; 

6 ‘‘(2) appointed as guardian of the beneficiary 

7 by a court of competent jurisdiction; or 

8 ‘‘(3) authorized to act on behalf of the bene9 ficiary under a durable power of attorney.’’. 

10 (2) CLERICAL AMENDMENT.—The table of sec11 tions at the beginning of chapter 55 of title 38, 

12 United States Code, is amended by striking the item 

13 relating to section 5502 and inserting the following: 

‘‘5502. Appointment of fiduciaries.’’. 

14 (b) SUPERVISION.— 

15 (1) IN GENERAL.—Chapter 55 of title 38, 

16 United States Code, is amended by inserting after 

17 section 5502, as amended by subsection (a)(1), the 

18 following new section: 

19 ‘‘§ 5502A. Supervision of fiduciaries 

20 ‘‘(a) COMMISSION.—(1)(A) In a case in which the 

21 Secretary determines that a commission is necessary in 

22 order to obtain the services of a fiduciary in the best inter23 ests of a beneficiary, the Secretary may authorize a fidu24 ciary appointed by the Secretary to obtain from the 

25 monthly benefits provided to the beneficiary a reasonable 


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1 commission for fiduciary services rendered, but the com2 mission for any month may not exceed the lesser of the 

3 following amounts: 

4 ‘‘(i) The amount that equals three percent of 

5 the monthly monetary benefits under laws adminis6 tered by the Secretary paid on behalf of the bene7 ficiary to the fiduciary. 

8 ‘‘(ii) $35. 

9 ‘‘(B) A commission paid under this paragraph may 

10 not be derived from any award to a beneficiary regarding 

11 back pay or retroactive benefits payments. 

12 ‘‘(C) A commission may not be authorized for a fidu13 ciary who receives any other form of remuneration or pay14 ment in connection with rendering fiduciary services for 

15 benefits under this title on behalf of the beneficiary. 

16 ‘‘(D) In accordance with section 6106 of this title, 

17 a commission may not be paid to a fiduciary if the Sec18 retary determines that the fiduciary misused any benefit 

19 payments of a beneficiary. 

20 ‘‘(E) If the Secretary determines that the fiduciary 

21 has misused any benefit or payments of a beneficiary, the 

22 Secretary may revoke the fiduciary status of the fiduciary. 

23 ‘‘(2) Where, in the opinion of the Secretary, any fidu24 ciary receiving funds on behalf of a Department bene25 ficiary is acting in such a number of cases as to make 


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1 it impracticable to conserve properly the estates or to su2 pervise the persons of the beneficiaries, the Secretary may 

3 refuse to make future payments in such cases as the Sec4 retary may deem proper. 

5 ‘‘(b) COURT.—Whenever it appears that any fidu6 ciary, in the opinion of the Secretary, is not properly exe7 cuting or has not properly executed the duties of the trust 

8 of such fiduciary or has collected or paid, or is attempting 

9 to collect or pay, fees, commissions, or allowances that are 

10 inequitable or in excess of those allowed by law for the 

11 duties performed or expenses incurred, or has failed to 

12 make such payments as may be necessary for the benefit 

13 of the ward or the dependents of the ward, then the Sec14 retary may appear, by the Secretary’s authorized attorney, 

15 in the court which has appointed such fiduciary, or in any 

16 court having original, concurrent, or appellate jurisdiction 

17 over said cause, and make proper presentation of such 

18 matters. The Secretary, in the Secretary’s discretion, may 

19 suspend payments to any such fiduciary who shall neglect 

20 or refuse, after reasonable notice, to render an account 

21 to the Secretary from time to time showing the application 

22 of such payments for the benefit of such incompetent or 

23 minor beneficiary, or who shall neglect or refuse to admin24 ister the estate according to law. The Secretary may re25 quire the fiduciary, as part of such account, to disclose 


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1 any additional financial information concerning the bene2 ficiary (except for information that is not available to the 

3 fiduciary). The Secretary may appear or intervene by the 

4 Secretary’s duly authorized attorney in any court as an 

5 interested party in any litigation instituted by the Sec6 retary or otherwise, directly affecting money paid to such 

7 fiduciary under this section. 

8 ‘‘(c) PAYMENT OF CERTAIN EXPENSES.—Authority 

9 is hereby granted for the payment of any court or other 

10 expenses incident to any investigation or court proceeding 

11 for the appointment of any fiduciary or other person for 

12 the purpose of payment of benefits payable under laws ad13 ministered by the Secretary or the removal of such fidu14 ciary and appointment of another, and of expenses in con15 nection with the administration of such benefits by such 

16 fiduciaries, or in connection with any other court pro17 ceeding hereby authorized, when such payment is author18 ized by the Secretary. 

19 ‘‘(d) TEMPORARY PAYMENT OF BENEFITS.—All or 

20 any part of any benefits the payment of which is sus21 pended or withheld under this section may, in the discre22 tion of the Secretary, be paid temporarily to the person 

23 having custody and control of the incompetent or minor 

24 beneficiary, to be used solely for the benefit of such bene25 ficiary, or, in the case of an incompetent veteran, may be 


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1 apportioned to the dependent or dependents, if any, of 

2 such veteran. Any part not so paid and any funds of a 

3 mentally incompetent or insane veteran not paid to the 

4 chief officer of the institution in which such veteran is a 

5 patient nor apportioned to the veteran’s dependent or de6 pendents may be ordered held in the Treasury to the credit 

7 of such beneficiary. All funds so held shall be disbursed 

8 under the order and in the discretion of the Secretary for 

9 the benefit of such beneficiary or the beneficiary’s depend10 ents. Any balance remaining in such fund to the credit 

11 of any beneficiary may be paid to the beneficiary if the 

12 beneficiary recovers and is found competent, or if a minor, 

13 attains majority, or otherwise to the beneficiary’s fidu14 ciary, or, in the event of the beneficiary’s death, to the 

15 beneficiary’s personal representative, except as otherwise 

16 provided by law; however, payment will not be made to 

17 the beneficiary’s personal representative if, under the law 

18 of the beneficiary’s last legal residence, the beneficiary’s 

19 estate would escheat to the State. In the event of the death 

20 of a mentally incompetent or insane veteran, all gratuitous 

21 benefits under laws administered by the Secretary depos22 ited before or after August 7, 1959, in the personal funds 

23 of patients trust fund on account of such veteran shall 

24 not be paid to the personal representative of such veteran, 

25 but shall be paid to the following persons living at the 


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1 time of settlement, and in the order named: The surviving 

2 spouse, the children (without regard to age or marital sta3 tus) in equal parts, and the dependent parents of such 

4 veteran, in equal parts. If any balance remains, such bal5 ance shall be deposited to the credit of the applicable cur6 rent appropriation; except that there may be paid only so 

7 much of such balance as may be necessary to reimburse 

8 a person (other than a political subdivision of the United 

9 States) who bore the expenses of last sickness or burial 

10 of the veteran for such expenses. No payment shall be 

11 made under the two preceding sentences of this subsection 

12 unless claim therefor is filed with the Secretary within five 

13 years after the death of the veteran, except that, if any 

14 person so entitled under said two sentences is under legal 

15 disability at the time of death of the veteran, such five16 year period of limitation shall run from the termination 

17 or removal of the legal disability. 

18 ‘‘(e) ESCHEATMENT.—Any funds in the hands of a 

19 fiduciary appointed by a State court or the Secretary de20 rived from benefits payable under laws administered by 

21 the Secretary, which under the law of the State wherein 

22 the beneficiary had last legal residence would escheat to 

23 the State, shall escheat to the United States and shall be 

24 returned by such fiduciary, or by the personal representa25 tive of the deceased beneficiary, less legal expenses of any 


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1 administration necessary to determine that an escheat is 

2 in order, to the Department, and shall be deposited to the 

3 credit of the applicable revolving fund, trust fund, or ap4 propriation. 

5 ‘‘(f) ASSISTANCE.—The Secretary shall provide to a 

6 fiduciary appointed under section 5502 of this title mate7 rials and tools to assist the fiduciary in carrying out the 

8 responsibilities of the fiduciary under this chapter, includ9 ing— 

10 ‘‘(1) handbooks, brochures, or other written 

11 material that explain the responsibilities of a fidu12 ciary under this chapter; 

13 ‘‘(2) tools located on an Internet website, in14 cluding forms to submit to the Secretary required 

15 information; and 

16 ‘‘(3) assistance provided by telephone.’’. 

17 (2) CLERICAL AMENDMENT.—The table of sec18 tions at the beginning of chapter 55 of title 38, 

19 United States Code, is amended by inserting after 

20 the item relating to section 5502 the following new 

21 item: 

‘‘5502A. Supervision of fiduciaries.’’. 

22 (c) DEFINITION OF FIDUCIARY.—Section 5506 of 

23 title 38, United States Code is amended— 

24 (1) by striking ‘‘For purposes’’ and inserting 

25 ‘‘(a) For purposes’’; and 


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1 (2) by adding at the end the following new sub2 section: 

3 ‘‘(b)(1) For purposes of subsection (a), the term ‘per4 son’ includes any— 

5 ‘‘(A) State or local government agency whose 

6 mission is to carry out income maintenance, social 

7 service, or health care-related activities; 

8 ‘‘(B) any State or local government agency with 

9 fiduciary responsibilities; or 

10 ‘‘(C) any nonprofit social service agency that 

11 the Secretary determines— 

12 ‘‘(i) regularly provides services as a fidu13 ciary concurrently to five or more individuals; 

14 and 

15 ‘‘(ii) is not a creditor of any such indi16 vidual. 

17 ‘‘(2) The Secretary shall maintain a list of State or 

18 local agencies and nonprofit social service agencies under 

19 paragraph (1) that are qualified to act as a fiduciary 

20 under this chapter. In maintaining such list, the Secretary 

21 may consult the lists maintained under section 807(h) of 

22 the Social Security Act (42 U.S.C. 1007(h)).’’. 

23 (d) QUALIFICATIONS.—Section 5507 of title 38, 

24 United States Code, is amended to read as follows: 


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1 ‘‘§ 5507. Inquiry, investigations, and qualification of 

2 fiduciaries 

3 ‘‘(a) INVESTIGATION.—Any certification of a person 

4 for payment of benefits of a beneficiary to that person as 

5 such beneficiary’s fiduciary under section 5502 of this title 

6 shall be made on the basis of— 

7 ‘‘(1) an inquiry or investigation by the Sec8 retary of the fitness of that person to serve as fidu9 ciary for that beneficiary to be conducted in advance 

10 of such certification and in accordance with sub11 section (b); 

12 ‘‘(2) adequate evidence that certification of that 

13 person as fiduciary for that beneficiary is in the in14 terest of such beneficiary (as determined by the Sec15 retary under regulations); 

16 ‘‘(3) adequate evidence that the person to serve 

17 as fiduciary protects the private information of a 

18 beneficiary in accordance with subsection (d)(1); and 

19 ‘‘(4) the furnishing of any bond that may be re20 quired by the Secretary in accordance with sub21 section (f). 

22 ‘‘(b) ELEMENTS OF INVESTIGATION.—(1) In con23 ducting an inquiry or investigation of a proposed fiduciary 

24 under subsection (a)(1), the Secretary shall conduct— 


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1 ‘‘(A) a face-to-face interview with the proposed 

2 fiduciary by not later than 30 days after the date on 

3 which such inquiry or investigation begins; and 

4 ‘‘(B) a background check of the proposed fidu5 ciary to— 

6 ‘‘(i) in accordance with paragraph (2), de7 termine whether the proposed fiduciary has 

8 been convicted of a crime; and 

9 ‘‘(ii) determine whether the proposed fidu10 ciary will serve the best interest of the bene11 ficiary, including by conducting a credit check 

12 of the proposed fiduciary and checking the 

13 records under paragraph (5). 

14 ‘‘(2) The Secretary shall request information con15 cerning whether that person has been convicted of any of16 fense under Federal or State law. If that person has been 

17 convicted of such an offense, the Secretary may certify the 

18 person as a fiduciary only if the Secretary finds that the 

19 person is an appropriate person to act as fiduciary for the 

20 beneficiary concerned under the circumstances. 

21 ‘‘(3) The Secretary shall conduct the background 

22 check described in paragraph (1)(B)— 

23 ‘‘(A) each time a person is proposed to be a fi24 duciary, regardless of whether the person is serving 

25 or has served as a fiduciary; and 


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1 ‘‘(B) at no expense to the beneficiary. 

2 ‘‘(4) Each proposed fiduciary shall disclose to the 

3 Secretary the number of beneficiaries that the fiduciary 

4 acts on behalf of. 

5 ‘‘(5) The Secretary shall maintain records of any per6 son who has— 

7 ‘‘(A) previously served as a fiduciary; and 

8 ‘‘(B) had such fiduciary status revoked by the 

9 Secretary. 

10 ‘‘(6)(A) If a fiduciary appointed by the Secretary is 

11 convicted of a crime described in subparagraph (B), the 

12 Secretary shall notify the beneficiary of such conviction 

13 by not later than 14 days after the date on which the Sec14 retary learns of such conviction. 

15 ‘‘(B) A crime described in this subparagraph is a 

16 crime— 

17 ‘‘(i) for which the fiduciary is convicted while 

18 serving as a fiduciary for any person; 

19 ‘‘(ii) that is not included in a report submitted 

20 by the fiduciary under section 5509(a) of this title; 

21 and 

22 ‘‘(iii) that the Secretary determines could affect 

23 the ability of the fiduciary to act on behalf of the 

24 beneficiary. 


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1 ‘‘(c) INVESTIGATION OF CERTAIN PERSONS.—(1) In 

2 the case of a proposed fiduciary described in paragraph 

3 (2), the Secretary, in conducting an inquiry or investiga4 tion under subsection (a)(1), may carry out such inquiry 

5 or investigation on an expedited basis that may include 

6 giving priority to conducting such inquiry or investigation. 

7 Any such inquiry or investigation carried out on such an 

8 expedited basis shall be carried out under regulations pre9 scribed for purposes of this section. 

10 ‘‘(2) Paragraph (1) applies with respect to a proposed 

11 fiduciary who is— 

12 ‘‘(A) the parent (natural, adopted, or step13 parent) of a beneficiary who is a minor; 

14 ‘‘(B) the spouse or parent of an incompetent 

15 beneficiary; 

16 ‘‘(C) a person who has been appointed a fidu17 ciary of the beneficiary by a court of competent ju18 risdiction; 

19 ‘‘(D) being appointed to manage an estate 

20 where the annual amount of veterans benefits to be 

21 managed by the proposed fiduciary does not exceed 

22 $3,600, as adjusted pursuant to section 5312 of this 

23 title; or 


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1 ‘‘(E) a person who is authorized to act on be2 half of the beneficiary under a durable power of at3 torney. 

4 ‘‘(d) PROTECTION OF PRIVATE INFORMATION.—(1) 

5 A fiduciary shall take all reasonable precautions to— 

6 ‘‘(A) protect the private information of a bene7 ficiary, including personally identifiable information; 

8 and 

9 ‘‘(B) securely conducts financial transactions. 

10 ‘‘(2) A fiduciary shall notify the Secretary of any ac11 tion of the fiduciary that compromises or potentially com12 promises the private information of a beneficiary. 

13 ‘‘(e) POTENTIAL MISUSE OF FUNDS.—(1) If the Sec14 retary has reason to believe that a fiduciary may be mis15 using all or part of the benefit of a beneficiary, the Sec16 retary shall— 

17 ‘‘(A) conduct a thorough investigation to deter18 mine the veracity of such belief; and 

19 ‘‘(B) if such veracity is established, transmit to 

20 the officials described in paragraph (2) a report of 

21 such investigation. 

22 ‘‘(2) The officials described in this paragraph are the 

23 following: 

24 ‘‘(A) The Attorney General. 


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1 ‘‘(B) Each head of a Federal department or 

2 agency that pays to a fiduciary or other person ben3 efits under any law administered by such depart4 ment of agency for the use and benefit of a minor, 

5 incompetent, or other beneficiary. 

6 ‘‘(f) BOND.—In determining whether a proposed fi7 duciary is required to furnish a bond under subsection 

8 (a)(4), the Secretary shall consider— 

9 ‘‘(1) the existence of any familial or other per10 sonal relationship between the proposed fiduciary 

11 and the beneficiary; and 

12 ‘‘(2) the care the proposed fiduciary has taken 

13 to protect the interests of the beneficiary. 

14 ‘‘(g) LIST OF FIDUCIARIES.—Each regional office of 

15 the Veterans Benefits Administration shall maintain a list 

16 of the following: 

17 ‘‘(1) The name and contact information of each 

18 fiduciary, including address, telephone number, and 

19 email address. 

20 ‘‘(2) With respect to each fiduciary described in 

21 paragraph (1)— 

22 ‘‘(A) the date of the most recent back23 ground check and credit check performed by the 

24 Secretary under this section; 


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1 ‘‘(B) the date that any bond was paid 

2 under this section; 

3 ‘‘(C) the name, address, and telephone 

4 number of each beneficiary the fiduciary acts on 

5 behalf of; and 

6 ‘‘(D) the amount that the fiduciary con7 trols with respect to each beneficiary described 

8 in subparagraph (C).’’. 

9 (e) ANNUAL RECEIPT OF PAYMENTS.— 

10 (1) IN GENERAL.—Section 5509 of title 38, 

11 United States Code, is amended— 

12 (A) in subsection (a)— 

13 (i) by striking ‘‘may require a fidu14 ciary to file a’’ and inserting ‘‘shall require 

15 a fiduciary to file an annual’’; and 

16 (ii) by adding at the end the following 

17 new sentence: ‘‘The Secretary shall trans18 mit such annual report or accounting to 

19 the beneficiary and any legal guardian of 

20 such beneficiary.’’; 

21 (B) by adding at the end the following new 

22 subsections: 

23 ‘‘(c) MATTERS INCLUDED.—Except as provided by 

24 subsection (f), an annual report or accounting under sub25 section (a) shall include the following: 


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1 ‘‘(1) For each beneficiary that a fiduciary acts 

2 on behalf of— 

3 ‘‘(A) the amount of the benefits of the ben4 eficiary provided under any law administered by 

5 the Secretary accrued during the year, the 

6 amount spent, and the amount remaining; and 

7 ‘‘(B) if the fiduciary serves the beneficiary 

8 with respect to benefits not administered by the 

9 Secretary, an accounting of all sources of bene10 fits or other income the fiduciary oversees for 

11 the beneficiary. 

12 ‘‘(2) A list of events that occurred during the 

13 year covered by the report that could affect the abil14 ity of the fiduciary to act on behalf of the bene15 ficiary, including— 

16 ‘‘(A) the fiduciary being convicted of any 

17 crime; 

18 ‘‘(B) the fiduciary declaring bankruptcy; 

19 and 

20 ‘‘(C) any judgments entered against the fi21 duciary. 

22 ‘‘(d) RANDOM AUDITS.—The Secretary shall annu23 ally conduct random audits of fiduciaries who receive a 

24 commission pursuant to subsection 5502A(a)(1) of this 

25 title. 


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1 ‘‘(e) STATUS OF FIDUCIARY.—If a fiduciary includes 

2 in the annual report events described in subsection (c)(2), 

3 the Secretary may take appropriate action to adjust the 

4 status of the fiduciary as the Secretary determines appro5 priate, including by revoking the fiduciary status of the 

6 fiduciary. 

7 ‘‘(f) CAREGIVERS AND CERTAIN OTHER FIDU8 CIARIES.—(1)(A) In carrying out this section, the Sec9 retary shall ensure that a caregiver fiduciary is required 

10 only to file an annual report or accounting under sub11 section (a) with respect to the amount of the benefits of 

12 the beneficiary provided under any law administered by 

13 the Secretary— 

14 ‘‘(i) spent on— 

15 ‘‘(I) food and housing for the beneficiary; 

16 and 

17 ‘‘(II) clothing, health-related expenses, 

18 recreation, and other personal items for the 

19 beneficiary; and 

20 ‘‘(ii) saved for the beneficiary. 

21 ‘‘(B) The Secretary shall coordinate with the Under 

22 Secretary for Benefits and the Under Secretary for Health 

23 to— 


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1 ‘‘(i) minimize the frequency with which employ2 ees of the Department visit the home of a caregiver 

3 fiduciary and beneficiary; and 

4 ‘‘(ii) limit the extent of supervision by such 

5 Under Secretaries with respect to such a fiduciary 

6 and beneficiary. 

7 ‘‘(C) In this paragraph, the term ‘caregiver fiduciary’ 

8 means a fiduciary who— 

9 ‘‘(i) in addition to acting as a fiduciary for a 

10 beneficiary, is approved by the Secretary to be a 

11 provider of personal care services for the beneficiary 

12 under paragraph (3)(A)(i) of section 1720G(a) of 

13 this title; 

14 ‘‘(ii) in carrying out such care services to such 

15 beneficiary, has undergone not less than four home 

16 visits under paragraph (9)(A) of such section; and 

17 ‘‘(iii) has not been required by the Secretary to 

18 take corrective action pursuant to paragraph (9)(C) 

19 of such section. 

20 ‘‘(2) In carrying out this section, the Secretary may 

21 adjust the matters required under an annual report or ac22 counting under subsection (a) with respect to a fiduciary 

23 whom the Secretary determines to have effectively pro24 tected the interests of the beneficiary over a sustained pe25 riod.’’; and 


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1 (C) by striking the section heading and in2 serting the following: ‘‘Annual reports and 

3 accountings of fiduciaries’’. 

4 (2) CLERICAL AMENDMENT.—The table of sec5 tions at the beginning of chapter 55 of title 38, 

6 United States Code, is amended by striking the item 

7 relating to section 5509 and inserting the following 

8 new item: 

‘‘5509. Annual reports and accountings of fiduciaries.’’. 

9 (f) REPAYMENT OF MISUSED BENEFITS.—Section 

10 6107(a)(2)(C) of title 38, United States Code, is amended 

11 by inserting before the period the following: ‘‘, including 

12 by the Secretary not acting in accordance with section 

13 5507 of this title’’. 

14 (g) ANNUAL REPORTS.—Section 5510 of title 38, 

15 United States Code, is amended by striking ‘‘The Sec16 retary shall include in the Annual Benefits Report of the 

17 Veterans Benefits Administration or the Secretary’s An18 nual Performance and Accountability Report’’ and insert19 ing ‘‘Not later than July 1 of each year, the Secretary 

20 shall submit to the Committees on Veterans’ Affairs of 

21 the House of Representatives and the Senate a separate 

22 report containing’’. 

23 (h) REPORT.—Not later than one year after the date 

24 of the enactment of this Act, the Secretary of Veterans 

25 Affairs shall submit to the Committee on Veterans’ Affairs 


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1 of the Senate and the Committee on Veterans’ Affairs of 

2 the House of Representatives a comprehensive report on 

3 the implementation of the amendments made by this Act, 

4 including— 

5 (1) detailed information on the establishment of 

6 new policies and procedures pursuant to such 

7 amendments and training provided on such policies 

8 and procedures; and 

9 (2) a discussion of whether the Secretary 

10 should provide fiduciaries with standardized finan11 cial software to simplify reporting requirements. 

12 SEC. 5. LIMITATION ON AWARDS AND BONUSES TO EM13 PLOYEES OF DEPARTMENT OF VETERANS AF14 FAIRS. 

15 For each of fiscal years 2014 through 2018, the Sec16 retary of Veterans Affairs may not pay more than 

17 $345,000,000 in awards or bonuses under chapter 45 or 

18 53 of title 5, United States Code, or any other awards 

19 or bonuses authorized under such title. 

Passed the House of Representatives October 28, 

2013. 

Attest: KAREN L. HAAS, 

Clerk. 


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