(3) in subsection (d), by striking ‘‘guardian, cu-
rator, or conservator’’ and inserting ‘‘fiduciary’’.
(c) CONFORMING AMENDMENT TO SECTION 6101.—
Section 6101(a) of such title is amended by striking
‘‘guardian, curator,’’ and all that follows through ‘‘bene-
ficiary,’’ and inserting ‘‘fiduciary (as defined in section
5506 of this title) for the benefit of a minor, incompetent,
or other beneficiary under laws administered by the Sec-
retary,’’.
SEC. 302. INQUIRY, INVESTIGATIONS, AND QUALIFICATION
OF FIDUCIARIES.
(a) IN GENERAL.—Chapter 55 of title 38, United
States Code, as amended by section 301(a)(1), is further
amended by adding at the end the following new section:
‘‘§ 5507. Inquiry, investigations, and qualification of
fiduciaries
‘‘(a) Any certification of a person for payment of ben-
efits of a beneficiary to that person as such beneficiary’s
fiduciary under section 5502 of this title shall be made
on the basis of—
‘‘(1) an inquiry or investigation by the Sec-
retary of the fitness of that person to serve as fidu-
ciary 
for 
that 
beneficiary, 
such 
inquiry 
or
investigation—
‘‘(A) to be conducted in advance of such
certification;
‘‘(B) to the extent practicable, to include a
face-to-face interview with such person; and
‘‘(C) to the extent practicable, to include a
copy of a credit report for such person issued
within one year of the date of the proposed ap-
pointment;
‘‘(2) adequate evidence that certification of that
person as fiduciary for that beneficiary is in the in-
terest of such beneficiary (as determined by the Sec-
retary under regulations); and
‘‘(3) the furnishing of any bond that may be re-
quired by the Secretary.
‘‘(b) As part of any inquiry or investigation of any
person under subsection (a), the Secretary shall request
information concerning whether that person has been con-
victed of any offense under Federal or State law which
resulted in imprisonment for more than one year. If that
person has been convicted of such an offense, the Sec-
retary may certify the person as a fiduciary only if the
Secretary makes a specific finding that the person has
been rehabilitated and is an appropriate person to act as
fiduciary for the beneficiary concerned under the cir-
cumstances.
‘‘(c)(1) In the case of a proposed fiduciary described
in paragraph (2), the Secretary, in conducting an inquiry
or investigation under subsection (a)(1), may carry out
such inquiry or investigation on an expedited basis that
may include waiver of any specific requirement relating
to such inquiry or investigation, including the otherwise
applicable provisions of subparagraphs (A), (B), and (C)
of such subsection. Any such inquiry or investigation car-
ried out on such an expedited basis shall be carried out
under regulations prescribed for purposes of this section.
‘‘(2) Paragraph (1) applies with respect to a proposed
fiduciary who is—
‘‘(A) the parent (natural, adopted, or step-
parent) of a beneficiary who is a minor;
‘‘(B) the spouse or parent of an incompetent
beneficiary;
‘‘(C) a person who has been appointed a fidu-
ciary of the beneficiary by a court of competent ju-
risdiction; or
‘‘(D) being appointed to manage an estate
where the annual amount of veterans benefits to be
managed by the proposed fiduciary does not exceed
$3600, as adjusted pursuant to section 5312 of this
title.
‘‘(d) TEMPORARY FIDUCIARIES.—When in the opin-
ion of the Secretary, a temporary fiduciary is needed in
order to protect the assets of the beneficiary while a deter-
mination of incompetency is being made or appealed or
a fiduciary is appealing a determination of misuse, the
Secretary may appoint one or more temporary fiduciaries
for a period not to exceed 120 days. If a final decision
has not been made within 120 days, the Secretary may
not continue the appointment of the fiduciary without ob-
taining a court order for appointment of a guardian, con-
servator, or other fiduciary under the authority provided
in section 5502(b) of this title.’’.
(b) CLERICAL AMENDMENT.—The table of sections
at the beginning of such chapter is amended by adding
after the item added by section 301(a)(2) the following
new item:
‘‘5507. Inquiry, investigations, and qualification of fiduciaries.’’.
SEC. 303. MISUSE OF BENEFITS BY FIDUCIARIES.
(a) PROTECTION OF VETERANS BENEFITS WHEN
ADMINISTERED BY FIDUCIARIES.—(1) Chapter 61 of title
38, United States Code, is amended by adding at the end
the following new sections:
‘‘§ 6106. Misuse of benefits by fiduciaries
‘‘(a) FEE FORFEITURE IN CASE OF BENEFIT MIS-
USE BY FIDUCIARIES.—A fiduciary may not collect a fee
from a beneficiary for any month with respect to which
the Secretary or a court of competent jurisdiction has de-
termined that the fiduciary misused all or part of the indi-
vidual’s benefit, and any amount so collected by the fidu-
ciary as a fee for such month shall be treated as a misused
part of the individual’s benefit.
‘‘(b) LIABILITY OF FIDUCIARIES FOR MISUSED BEN-
EFITS.—(1) If the Secretary or a court of competent juris-
diction determines that a fiduciary that is not a Federal,
State, or local government agency has misused all or part
of a beneficiary’s benefit that was paid to such fiduciary,
the fiduciary shall be liable for the amount misused, and
such amount (to the extent not repaid by the fiduciary)
shall be treated as an erroneous payment of benefits under
this title to the fiduciary for purposes of laws pertaining
to the recovery of overpayments. The amount of such over-
payment shall constitute a liability of such fiduciary to the
United States and may be recovered in the same manner
as any other debt due the United States. Subject to para-
graph (2), upon recovering all or any part of such amount,
the Secretary shall pay an amount equal to the recovered
amount to such beneficiary or such beneficiary’s successor
fiduciary.
‘‘(2) The total of the amounts paid to a beneficiary
(or a beneficiary’s successor fiduciary) under paragraph
(1) and under section 6107 of this title may not exceed
the total benefit amount misused by the fiduciary with re-
spect to that beneficiary.
‘‘(c) MISUSE OF BENEFITS DEFINED.—For purposes
of this chapter, misuse of benefits by a fiduciary occurs
in any case in which the fiduciary receives payment, under
any of laws administered by the Secretary, for the use and
benefit of a beneficiary and uses such payment, or any
part thereof, for a use other than for the use and benefit
of such beneficiary or that beneficiary’s dependents. Re-
tention by a fiduciary of an amount of a benefit payment
as a fiduciary fee or commission, or as attorney’s fees (in-
cluding expenses) and court costs, if authorized by the
Secretary or a court of competent jurisdiction, shall be
considered to be for the use or benefit of such beneficiary.
‘‘(d) REGULATIONS.—The Secretary may prescribe
by regulation the meaning of the term ‘use and benefit’
for purposes of this section.
‘‘(e) FINALITY OF DETERMINATIONS.—A determina-
tion by the Secretary that a fiduciary has misused benefits
is a decision of the Secretary for purposes of section
511(a) of this title.
‘‘§ 6107. Reissuance of benefits
‘‘(a) NEGLIGENT FAILURE BY SECRETARY.—(1) In
any case in which the negligent failure of the Secretary
to investigate or monitor a fiduciary results in misuse of
benefits by the fiduciary, the Secretary shall pay to the
beneficiary or the beneficiary’s successor fiduciary an
amount equal to the amount of benefits that were so mis-
used.
‘‘(2) There shall be considered to have been a neg-
ligent failure by the Secretary to investigate and monitor
a fiduciary in the following cases:
‘‘(A) A case in which the Secretary failed to
timely review a fiduciary’s accounting.
‘‘(B) A case in which the Secretary was notified
of allegations of misuse, but failed to act in a timely
manner to terminate the fiduciary.
‘‘(C) In any other case in which actual neg-
ligence is shown.
‘‘(b) REISSUANCE OF MISUSED BENEFITS IN OTHER
CASES.—(1) In any case in which a fiduciary described
in paragraph (2) misuses all or part of an individual’s ben-
efit paid to such fiduciary, the Secretary shall pay to the
beneficiary or the beneficiary’s successor fiduciary an
amount equal to the amount of such benefit so misused.
‘‘(2) Paragraph (1) applies to a fiduciary that—
‘‘(A) is not an individual; or
‘‘(B) is an individual who, for any month dur-
ing a period when misuse occurs, serves 10 or more
individuals who are beneficiaries under this title.
‘‘(c) RECOUPMENT OF AMOUNTS REISSUED.—In any
case in which the Secretary reissues a benefit payment (in
whole or in part) under subsection (a) or (b), the Sec-
retary shall make a good faith effort to obtain recoupment
from the fiduciary to whom the payment was originally
made.’’.
(b) CLERICAL AMENDMENT.—The table of sections
at the beginning of such chapter is amended by adding
at the end the following new items:
‘‘6106. Misuse of benefits by fiduciaries.
‘‘6107. Reissuance of benefits.’’.
SEC. 304. ADDITIONAL PROTECTIONS FOR BENEFICIARIES
WITH FIDUCIARIES.
(a) ONSITE REVIEWS
AND REQUIRED ACCOUNT-
INGS.—(1) Chapter 55 of title 38, United States Code,
as amended by section 302(a), is further amended by add-
ing at the end the following new sections:
‘‘§ 5508. Periodic onsite reviews of institutional fidu-
ciaries
‘‘In addition to such other reviews of fiduciaries as
the Secretary may otherwise conduct, the Secretary shall
provide for the periodic onsite review of any person or
agency located in the United States that receives the bene-
fits payable under laws administered by the Secretary to
another individual pursuant to the appointment of such
person or agency as a fiduciary under section 5502(a)(1)
of this title in any case in which the fiduciary is serving
in that capacity with respect to more than 20 beneficiaries
and the total annual amount of such benefits exceeds
$50,000, as adjusted pursuant to section 5312 of this
title.
‘‘§ 5509. Authority to redirect delivery of benefit pay-
ments when a fiduciary fails to provide
required accounting
‘‘(a) REQUIRED REPORTS AND ACCOUNTINGS.—The
Secretary may require a fiduciary to file a report or ac-
counting pursuant to regulations prescribed by the Sec-
retary.
‘‘(b) ACTIONS UPON FAILURE TO FILE.—In any case
in which a fiduciary fails to submit a report or accounting
required by the Secretary under subsection (a), the Sec-
retary may, after furnishing notice to such fiduciary and
the beneficiary entitled to such payment of benefits, re-
quire that such fiduciary appear in person at a regional
office of the Department serving the area in which the
beneficiary resides in order to receive such payments.’’.
(2) The table of sections at the beginning of such
chapter is amended by adding after the item added by sec-
tion 302(b) the following new items:
‘‘5508. Periodic onsite reviews of institutional fiduciaries.
‘‘5509. Authority to redirect delivery of benefit payments when a fiduciary fails
to provide required accounting.’’.
(b) CIVIL MONETARY PENALTIES; JUDICIAL ORDERS
OF RESTITUTION.—(1) Chapter 61 of title 38, United
States Code, as amended by section 303(a), is further
amended by adding at the end the following new sections:
‘‘§ 6108. Civil monetary penalties
‘‘(a) PENALTY FOR CONVERSION.—Any person (in-
cluding an organization, agency, or other entity) who, hav-
ing received, while acting in the capacity of a fiduciary
pursuant to section 5502 of this title, a payment under
a law administered by the Secretary for the use and ben-
efit of another individual, converts such payment, or any
part thereof, to a use that such person knows or should
know is other than for the use and benefit of such other
individual shall be subject to, in addition to any other pen-
alty that may be prescribed by law, a civil monetary pen-
alty assessed by the Secretary of not more than $5,000
for each such conversion.
‘‘(b) PENALTY IN LIEU OF DAMAGES.—Any person
who makes a conversion of a payment described in sub-
section (a) and is subject to a civil monetary penalty under
that subsection by reason of such conversion shall also be
subject to an assessment by the Secretary, in lieu of dam-
ages sustained by the United States resulting from the
conversion, of not more than twice the amount of any pay-
ments so converted.
‘‘(c) COSTS OF RECOVERY.—From amounts collected
under this section, the amount necessary to recoup the De-
partment’s costs of such collection shall be credited to ap-
propriations currently available for the same purpose as
the appropriation that incurred those costs, to remain
available until expended.
‘‘§ 6109. Authority for judicial orders of restitution
‘‘(a) Any Federal court, when sentencing a defendant
convicted of an offense arising from the misuse of benefits
under this title, may order, in addition to or in lieu of
any other penalty authorized by law, that the defendant
make restitution to the Department.
‘‘(b) Sections 3612, 3663, and 3664 of title 18 shall
apply with respect to the issuance and enforcement of or-
ders of restitution under subsection (a). In so applying
those sections, the Department shall be considered the vic-
tim.
‘‘(c) If the court does not order restitution, or orders
only partial restitution, under subsection (a), the court
shall state on the record the reasons therefor.
‘‘(d)(1) Except as provided in paragraph (2),
amounts received or recovered by the Secretary pursuant
to an order of restitution under subsection (a), to the ex-
tent and in the amounts provided in advance in appropria-
tions Acts, shall be available to defray expenses incurred
by the Office of the Inspector General for the investigation
of fiduciaries under this title.
‘‘(2) Paragraph (1) shall not apply with respect to
amounts received in connection with misuse by a fiduciary
of funds paid as benefits under laws administered by the
Secretary. Such amounts shall be paid to the individual
whose benefits were misused unless the Secretary has pre-
viously reissued the misused benefits, in which case the
amounts shall be treated in the same manner as overpay-
ments recouped by the Secretary and shall be deposited
to the credit of the applicable revolving fund, trust fund,
or appropriation.’’.
(2) The table of sections at the beginning of such
chapter is amended by adding after the item added by sec-
tion 303(b) the following new items:
‘‘6108. Civil monetary penalties.
‘‘6109. Authority for judicial orders of restitution.’’.
SEC. 305. ANNUAL REPORT.
(a) IN GENERAL.—Chapter 55 of title 38, United
States Code, as amended by section 304(a)(1), is further
amended by adding at the end the following new section:
‘‘§ 5510. Annual report
‘‘The Secretary shall include in the Annual Benefits
Report of the Veterans Benefits Administration or the
Secretary’s Annual Performance and Accountability Re-
port information concerning fiduciaries who have been ap-
pointed to receive payments for beneficiaries of the De-
partment. As part of such information, the Secretary shall
separately set forth the following:
‘‘(1) The number of beneficiaries in each cat-
egory (veteran, surviving spouse, child, adult dis-
abled child, or parent).
‘‘(2) The types of benefit being paid (compensa-
tion, pension, dependency and indemnity compensa-
tion, death pension or benefits payable to a disabled
child under chapter 18 of this title).
‘‘(3) The total annual amounts and average an-
nual amounts of benefits paid to fiduciaries for each
category and type of benefit.
‘‘(4) The number of fiduciaries who are the
(spouse, parent, legal custodian, court-appointed fi-
duciary, institutional fiduciary, custodian in fact,
and supervised direct payment).
‘‘(5) The number of cases in which the fidu-
ciary was changed by the Secretary because of a
finding that benefits had been misused.
‘‘(6) How such cases of misuse of benefits were
addressed by the Secretary.
‘‘(7) The final disposition of such cases of mis-
use of benefits, including the number and dollar
amount of any civil or criminal penalties imposed.
‘‘(8) Such other information as the Secretary
considers appropriate.’’.
(b) CLERICAL AMENDMENT.—The table of sections
at the beginning of such chapter is amended by adding
after the items added by the amendment made by section
304(a)(2) the following new item:
‘‘5510. Annual report.’’.
SEC. 306. ANNUAL ADJUSTMENT IN BENEFITS THRESH-
OLDS.
Section 5312(b)(1) of title 38, United States Code,
is amended by inserting ‘‘and the annual benefit amount
limitations under sections 5507(c)(2)(D) and 5508 of this
title,’’ after ‘‘(d)(3) of such section,’’.
SEC. 307. EFFECTIVE DATES.
(a) IN GENERAL.—Except as otherwise provided, this
title and the amendments made by this title shall take ef-
fect on the first day of the seventh month beginning after
the date of the enactment of this Act.
(b) SPECIAL RULES.—(1) Section 5510 of title 38,
United States Code, as added by section 305(a), shall take
effect on the date of the enactment of this Act.
(2) Sections 6106 and 6107 of title 38, United States
Code, as added by section 303(a), shall apply with respect
to any determinations by the Secretary of Veterans Affairs
made after the date of the enactment of this Act of misuse
of funds by a fiduciary.
TITLE IV—OTHER MATTERS
SEC. 401. INVENTORY OF MEDICAL WASTE MANAGEMENT
ACTIVITIES AT DEPARTMENT HEALTH-CARE
FACILITIES.
(a) INVENTORY.—The Secretary of Veterans Affairs
shall establish and maintain a national inventory of med-
ical waste management activities in the health-care facili-
ties of the Department of Veterans Affairs. The inventory
shall include the following:
(1) A statement of the current national policy
of the Department on managing and disposing of
medical waste, including regulated medical waste in
all its forms.
(2) A description of the program of each geo-
graphic service area of the Department to manage
and dispose of medical waste, including general med-
ical waste and regulated medical waste, with a de-
scription of the primary methods used in those pro-
grams and the associated costs of those programs,
with cost information shown separately for in-house
costs (including full-time equivalent employees) and
contract costs.
(b) REPORT.—Not later than April 15, 2005, the
Secretary of Veterans Affairs shall submit to the Commit-
tees on Veterans’ Affairs of the Senate and House of Rep-
resentatives a report on medical waste management activi-
ties in the facilities of the Department of Veterans Affairs.
The report shall include the following:
(1) The inventory established under subsection
(a), including all the matters specified in that sub-
section.
(2) A listing of each violation of medical waste
management and disposal regulations reported at
any health-care facility of the Department over the
preceding five years by any State or Federal agency,
along with an explanation of any remedial or other
action taken by the Secretary in response to each
such reported violation.
(3) A description of any plans to modernize,
consolidate, or otherwise improve the management of
medical waste and disposal programs at health-care
facilities of the Department, including the projected
costs associated with such plans and any barriers to
achieving goals associated with such plans.
(4) An assessment or evaluation of the available
methods of disposing of medical waste and identi-
fication of which of those methods are more desir-
able from an environmental perspective in that they
would be least likely to result in contamination of air
or water or otherwise cause future cleanup problems.
SEC. 402. TECHNICAL AMENDMENTS TO EDUCATION PRO-
GRAM PROVISIONS.
(a) INAPPLICABILITY OF WAGE REQUIREMENTS FOR
ON-JOB TRAINING PROGRAMS LEADING TO SELF-EM-
PLOYMENT.—(1) Section 3677(b) is amended by adding
at the end the following new paragraph:
‘‘(3) Notwithstanding paragraph (1)(A) and sub-
section (c)(8), no wages shall be required to be paid an
eligible person or veteran by a training establishment de-
scribed in section 3452(e)(2) of this title.’’.
(2) Section 3452(e), as amended by section 301 of
the Veterans Benefits Act of 2003 (Public Law 108–183;
117 Stat. 2658), is amended by striking ‘‘An’’ in para-
graph (2) and inserting ‘‘For the period beginning on Oc-
tober 1, 2005, and ending on September 30, 2010, an’’.
(b) EFFECTIVE DATE.—The amendments made by
subsection (a) shall take effect as if included in the enact-
ment of section 301 of the Veterans Benefits Act of 2003
(Public Law 108–183; 117 Stat. 2658).
Passed the House of Representatives October 7 (leg-
islative day, October 6), 2004.
Attest:
Clerk.
108TH CONGRESS
2D SESSION
H. R. 4658
AN ACT
To amend the Servicemembers Civil Relief Act to
make certain improvements and technical correc-
tions to that Act, otherwise to improve legal pro-
tections provided to reserve component members
called to active duty, and for other purposes.