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Predatory Claim Companies Steal Billions from Disabled Veterans

Updated: Nov 8

By Paul Sullivan

Thanks to bipartisan work in Congress and the President’s signature in August 2022, the PACT Act became law. Since then, a tide of more than a million disability claims have been submitted by veterans to the Department of Veterans Affairs (VA).

Unfortunately, a slew of more than two-dozen predatory claim companies smelled blood in the water – and they’re illegally stealing billions of dollars in VA benefits from hundreds of thousands of our nation’s injured, ill, traumatized, and disabled veterans.

Armed with slick websites and misleading promises to deliver increased benefits, the predatory claim industry exploded during the COVID-19 pandemic when veterans were often stuck at home as they searched online for help filing VA claims.

With flashy, persistent, and false ads, the predators offer “coaching” and “consulting” to veterans. These predators don’t inform the veteran their services are potentially illegal. The predators have opened call centers in the Philippines and Puerto Rico where they pressure veterans to quickly sign unenforceable contracts and then hand over thousands of dollars in earned VA disability benefits to the crooks.

How are these predatory practices illegal? Federal law dating to the Civil War requires anyone assisting a veteran with filing a VA disability benefit claim or appeal be pre-approved by VA so that the veterans are not robbed. VA rules mandate background checks, and VA accreditation protects both veterans and taxpayers from criminals.

The predators charge veterans fees often exceeding $10,000 for little to no work. In reality, veterans get better results for free from a VA-accredited Veterans Service Organization (VSOs) such as the Veterans of Foreign Wars and The American Legion.

The shock is how the government is not arresting the predators. In 2006, Congress removed criminal penalties for violating VA’s accreditation rules. Since then, every non-VA-accredited person assisting a veteran with a VA claim continues brazenly committing a crime – yet they face no jail time. No fine. Nothing.

VA Secretary Denis McDonough has publicly urged veterans not to pay anyone to file an initial VA claim. VA sends companies and people violating the law “cease and desist” letters, plus VA issues press releases warning veterans not to be snookered. Another way to inform veterans and mitigate the crime spree is for VA to publish a list of predatory companies along with full copies of VA’s demand letters.

The scope of financial fraud harming veterans is staggering and growing. One predatory company admitted to Congress how they stole an average of $5,000 from each veteran. A review of nine predatory websites revealed nearly 400,000 veterans fleeced – so far. For the past few years, that totals nearly $2 billion in VA taxpayer-funded benefits stolen from disabled veterans. That’s the tip of the cybercrime iceberg.

Congress held a hearing in April 2022 exposing this exploitation. Introduced that year, the “GUARD VA” bill would reinstate penalties for non-VA-accredited claim sharks. However, the GUARD bill died after campaign contributions began pouring in. Reintroduced in 2023, the GUARD bill stalled again, again leaving VA without the tools needed to prosecute predatory companies.

In 2023, the criminals struck back against renewed enforcement. Using money stolen from veterans, the sharks aggressively push another bill, the PLUS Act, or the “Preserving Lawful Utilization of Services” Act. It should be called the “Please Let Us Steal More" bill because it would open the door to more crime targeting veterans.

The unwise PLUS bill would automatically grant VA approval – without a background check – and even forgive their past misdeeds. That’s unconscionable. There are no “guardrails” that can be designed to combat the predators because they chose not to become VA-accredited, and they have demonstrated no intent to follow any law.

Passing the PLUS Act turns every veteran into chum for these claim sharks to devour, placing more veterans and billions of dollars of taxpayer money at risk.

A few veterans are fighting back by suing and demanding a stop to these predatory and illegal practices. But those courtroom battles may take months to succeed and protect veterans. States are stepping in. Louisiana shut down one illegal operation, and New Jersey passed a law in August to stop predatory sharks.

The criminal predatory enterprises will continue targeting disabled veterans until our government holds them accountable. President Joe Biden and VA Secretary Denis McDonough need to make passage of the GUARD VA Act a top priority.


The author is a Gulf War veteran and former deputy secretary for the California Department of Veterans Affairs who currently serves as the director of veterans outreach at Bergmann & Moore, a national law firm managed by VA-accredited attorneys providing training and Appellate litigation support to Veterans and advocates. He is also a member of VHPI's Steering Committee.

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