By Brian Todd, Isabelle Khurshudyan, CNN
(CNN) — An Army combat veteran now living in the Midwest was dealing with multiple injuries by the time he finished his military service. He’d suffered a traumatic brain injury after his vehicle struck an IED during his deployment to Afghanistan in the late 2000s.
But when the veteran, who CNN is identifying as Adam, filed his disability compensation claims with the Department of Veterans Affairs, he felt he was failed on two fronts.
First, the VA process was confusing, he said, and it took the department four months to get back to him – to say he didn’t qualify for any benefits. Then he sought help from a company that promised to guide him through the process for a fee, only to still end up with no benefits and a bill for thousands of dollars.
“They pretty much did jack sh*t for me,” said Adam, referring to the outside company. He asked to be identified by a pseudonym to protect his privacy.
Adam’s story is one that has played out with veterans for decades.
Veterans are supposed to be able to get these payments by filing for their benefits directly through the VA, and to get help filling out the paperwork for free from non-profit and government-affiliated groups called veterans service organizations (VSOs), which are accredited by the government to aid them.
Instead, frustrated by cumbersome paperwork and VSOs that are often too inundated with work for timely help, many veterans instead turn to private companies that charge a fee.
Critics call these consultants “claims sharks” – for-profit consultancies that say they help veterans get higher compensation while also taking a cut for themselves. These consultancies operate without accreditation from the VA, a process that includes taking assessments and passing a background check, which is meant to ensure a level of oversight into the process.
At the same time, some for-profit consultancies have been accused of using dishonest tactics to obtain higher fees, whether by overcharging veterans directly, or misrepresenting their clients to the VA to get a bigger cut from higher compensations that are paid out.
The for-profit consultants contend they help veterans get more benefits – which some veterans agree with – and that most veterans come to them because they didn’t get the compensation they believe they were owed from the VA. These companies contend that they are not preparing paperwork for veterans, but simply helping them navigate a complex system, and therefore are not in breach of federal requirements.
A regulatory mish-mash
Bill Taylor, the co-founder of claims consultant Veterans Guardian, argues that companies like his should be allowed to operate within a legal framework, which would also bring more regulation to the industry and cut down on what he described as “predatory practices” from some “bad actors.”
“Not only do we want to protect a veteran’s right to choose, but we can do that while also providing protections,” Taylor said.
Some states have sought to regulate the industry. Last year, Louisiana became the first state to pass a law to regulate unaccredited claims consultants by capping their fees and requiring certain disclosures from them. The bill was modeled after a version that stalled in Congress.
Some for profit consultancies have welcomed these state laws, but VSOs have not.
But last week, a federal court struck down the Louisiana law as unconstitutional. John Wells, a lawyer and director of a veterans’ group that sued the state over the law, argued states shouldn’t be allowed to interfere in the regulation of federal benefits.
“If other states try to institute laws like this, we will take action,” Wells said.
For its part, the “VA continues to examine this issue, and in the meantime, we are working to make it easier for Veterans