Guardianship and the VA Fiduciary Program
Section Overview: This section addresses two similar concepts that may, in some instances, be interrelated: guardianship and the VA Fiduciary Program. Both are intended to help veterans who have mental or physical disabilities rendering them incapacitated in some fashion, but both work in very different ways. This section first explains the different types of guardianships, how to obtain a guardianship, what kinds of issues and conditions are covered by guardianships, and conditions that are unique to disabled veterans.
The VA Fiduciary Program, on the other hand, is a VA program that appoints a person to manage the veteran’s VA benefits money when the veteran lacks capacity to do so. Unlike a guardianship, which can extend to all areas of the veteran’s life, the Fiduciary Program is more narrowly focused on administration of VA benefits funds only. This section will explain how the Fiduciary Program works and how it is both different from, and complimentary to, a
guardianship; how the need for a fiduciary is determined; and how you can help your veteran by obtaining a fiduciary.
1. What is guardianship, and why would I need it for my veteran?
A “guardian” is a person who is legally responsible for managing the affairs of an incapacitated person. A person can formally become a guardian only if appointed by a court. If your veteran has a physical or mental condition giving rise to an inability to make decisions regarding
financial matters and/or his or her daily needs, you may consider having a guardian appointed to make these decisions on behalf of your veteran. If you are appointed as a guardian yourself, the court’s order will describe the types of decisions you are now legally allowed to make for your veteran, and your veteran will no longer have the legal ability to make these decisions.
The process for becoming a guardian is controlled by state law and will likely vary somewhat from state to state, but the typical process involves a court taking two steps:
First, the court will formally determine that your veteran is incapacitated in some fashion. Perhaps the court will find that your veteran has demonstrated an inability to make financial decisions, or that your veteran is not able to make decisions about health care needs.
If the court finds that any existing conditions demonstrating diminished capacity and possible harm it will then take the next step of formally appointing a guardian. You may ask the court to appoint you, or you may ask to have someone else appointed.
Your veteran will receive notice of a hearing on the guardianship petition. Your veteran is allowed to object to the appointment of a guardian. Your veteran has the right to be represented by an attorney in the process; in some states an attorney may be appointed by the court if requested. There is also a right to be present at the hearing; and under the Americans with Disabilities Act, your veteran has the right to court accommodations if he or she has limitations that make participation in the court proceeding difficult. You should also be aware that even though you may ask the court to appoint a guardian out of a concern for your veteran’s well-being, a guardianship will terminate your veteran’s legal ability to make decisions for himself or
herself, which is a very serious matter. As a result, the court will be concerned about protecting your veteran during the guardianship process. The court may appoint an objective third party, often called a “guardian ad-litem” or “court visitor,” to review your veteran’s case, examine medical records and talk to witnesses, and to then issue a formal report to the court giving an opinion, based on all of the evidence, whether a guardianship is appropriate. The court will weigh this opinion very heavily.
Having a guardian appointed requires the filing of a complex legal action that is likely beyond the ability of a layperson. If you wish to seek a guardianship for your veteran, you will probably need a lawyer. Many organizations provide pro bono (no cost) or low-cost lawyers for this kind of case. Refer to our Directory of Programs for information about these kinds of lawyers in your state.
2. I understand that a court has to find my veteran to be “incapacitated” in order to determine whether a guardianship is appropriate. How is this done?
Determining capacity is a complex process that turns on the evidence provided to the court, which can include testimony of friends, family, and caregivers; medical evidence; possible criminal activity or activity that would hold the veteran civilly liable (like not paying bills); and other evidence. A court will want to ensure that the person’s condition is quite serious and not just due to, for example, a lack of attentiveness to the activities of daily living—a court will be looking to see whether the person is “gravely disabled.” The court will require at least a statement from a physician or other clinician, and may order evaluations by additional experts, such as neurologists, social workers, and psychologists, to determine the capacity of your veteran. If your veteran has received a disability rating from the VA, this may be one of the strongest pieces of evidence of incapacity, but it does not automatically lead to a guardianship. There are, however, many other factors that may come into play. See the information on this site about How the VA Establishes Incapacity [ANCHOR LINK].
The American Bar Association and American Psychological Association have published a handbook that describes, in detail, how to make assessments of diminished capacity. Though the handbook is targeted at determining incapacity in older adults, the same principles apply to wounded veterans. You can access the handbook here.
Ultimately, however, if you believe your veteran to be incapacitated and in need of a
guardianship, you should first talk with a lawyer who can best evaluate how to build such a case. Our Directory of Programs can provide you with information about pro bono and low-cost programs in your area that might be able to connect you with a lawyer to provide this assistance. However, before you file for guardianship, be sure you have explored other less restrictive options for decision making that don’t result in court removal of rights. Perhaps your veteran is able to execute a financial power of attorney and a health care advance directive—see the information on this site about Powers of Attorney [LINK] to learn more about this process and the requirements.
The guardian’s legal responsibilities will be spelled out in the court order appointing the
guardian. As a general rule, however, there are two broad categories over which a person may be appointed guardian.
The first is “guardian of the estate,” or “guardian of property.” This type of guardian manages some or all of your veteran’s property and finances. Depending upon what state law and the court’s order requires, this type of guardian must provide a regular accounting to the court about how the veteran’s finances and property are being managed; how money, benefit income, and assets are utilized; and there may be certain decisions that will first require court approval before the guardian can make them.
The second type is “guardian of the person.” This guardian is responsible for assessing and meeting some or all of your veteran’s physical, mental, and emotional needs, and to provide whatever assistance is necessary for daily living activities. When serving as guardian of the person, the guardian may be required to provide the court with a care plan that describes how the veteran’s personal needs will be met, and then may be required to give periodic reports to the court on how the plan is being implemented. All states require at least a status report describing the current health status, living arrangements, and services provided to the person. State law may impose certain limitations on what kinds of decisions a guardian of the person may make without prior court approval, such as prohibiting the veteran from being involuntarily committed to mental institution or being admitted to a nursing home.
If your veteran’s incapacity is not severe, the court may characterize the guardianship as a “limited guardianship,” which would authorize the guardian to make only certain kinds of decisions for the veteran. Regardless of what the guardianship is called, the court’s order will very clearly spell out what the guardian is legally entitled to do for any given veteran.
Court-appointed guardians for veterans in particular will have a range of responsibilities, and you should be aware that these extend not just to the personal care of their veterans, but also to other tasks that may be more relatively mundane, such as filing and submitting paperwork related to VA benefits. Though these kinds of activities may seem not as important as other things, such as providing medical care, under the legal obligations imposed by the guardianship, they are just as important and should not be overlooked.
4. What is a trustee? conservator? curator? Or, are they all the same but different words are used for different states?
As noted above, guardianships are defined by state law and may vary from state to state. Different states use different terms, and all of these may or may not mean the same thing as “guardian.” In a growing number of states, a “guardian” makes personal decisions, whereas a “conservator” makes financial decisions and is generally, but not always, another name for “guardian of property.” Many states have developed informational materials describing the guardianship process under state law. You should both refer to these materials as well as speak with a lawyer in your state to learn more. To find information about the law in your particular
state, visit our Directory of Programs. At the top of your state’s page, you may find a link to further educational materials if one is available.
5. If my veteran and I move to a different state, do I have to redo the guardianship papers?
Your court order of guardianship will be legally effective in the state where the court appointment was made regardless of whether you move to a different state. There is no
guarantee, however, that your guardianship will be fully recognized in a new state if you move. There are a couple of key issues to consider when thinking about moving under these
First, the court order of guardianship may require periodic reports or appearances in that state’s court for the duration of the guardianship, and you will need to comply with these requirements. This may mean travel back to the state where the guardianship order was entered. Also, it is likely that your guardianship is good for only a specified period of time, which is defined by state law. After the expiration of this time, you may have to renew the guardianship. So, for example, your guardianship order may say that it expires after five years, and if you move to another state during that time, you may or may not be able to renew the guardianship in your new state and might have to return to your prior state—which may then find that it is no longer the correct state, at which point you may need to file a new case in the new state. You may need to seek permission from the court to move your veteran out of state. Thirty-seven states have adopted a uniform guardianship jurisdiction law that makes moving from state to state easier— but this is still a complex area and you should consult an attorney before moving.
Second, you may run into problems with organizations or providers in the new state that do not recognize the out-of-state order. For example, if you seek to obtain medical care on behalf of your veteran at a facility in your new state and you present your out-of-state order, the staff at the medical facility may be unfamiliar with your type of order and be uncooperative. This may not be legally appropriate, but it is the type of practical problem you may encounter. In states that have adopted the “uniform jurisdiction act,” you can register your order in the new state, and then providers will recognize it. Typically this will be done in your new state’s court, and the procedure will vary from place to place. You should consult an attorney on the process for doing this.
The best advice: If you have a court order of guardianship and anticipate moving in the future, or if the opportunity to move presents itself later on, you should consult with an attorney—
preferably the one who assisted you with the guardianship in the first place. The attorney can advise you further about your options.
6. My veteran gave me a power of attorney before he deployed, and now he has been rated as 100 percent disabled by the VA due to mental health problems, which have left him unable to manage money or properly care for himself. Do I need a
First, you should review the power of attorney to ensure that it is still in effect and has not expired. If it has not expired, you then need to determine the type of power of attorney that you have. In the situation described in the question, your veteran has given you the legal right to make the decisions described on the power of attorney on his behalf. If the power of attorney that you have is not described as a “durable power of attorney” and/or explicitly states that it remains in effect even after incapacity, then your power of attorney will not be effective to allow you to make legal decisions for your incapacitated veteran.
In short, you cannot use a power of attorney to make legal decisions for an incapacitated person unless the power of attorney explicitly says so. Further, a person cannot grant or sign a power of attorney once that person lacks the ability to understand the transaction.
Even if you have a durable power of attorney that remains in effect after your veteran loses capacity to execute the document, it may not give you the full range of legal authority that you need to properly care for your veteran. So this type of power of attorney may or may not be an adequate substitute for a guardianship.
A durable power of attorney does not limit your veteran’s ability to act on his or her own. If your veteran has a significant incapacity and is making legal decisions that are harmful to himself or herself and others (such as borrowing money they can’t afford to repay), a guardianship may be necessary to limit the enforceability of legal decisions made by the incapacitated veteran. For more information, visit our Powers of Attorney section of this site. [LINK] And if you have a power of attorney and a veteran with diminished capacity, seek out legal advice about what your power of attorney does (and does not) allow you to do, and to get advice about whether a guardianship would still be a good idea. Visit our Directory of Programs for a resource near you that can provide you with this legal advice.
7. I have a close friend who is a disabled veteran and who has a court-appointed guardian, and I don’t believe the guardian is providing adequate care and properly managing money. What can I do?
You have the right to go to the court that issued the guardianship and raise your concerns through a formal request in the form of a petition. If you believe the guardian is abusing or exploiting your veteran, contact adult protective services. You could also contact the state Protection and Advocacy agency in your state that represents the rights of individuals with disabilities, as well as the office of the state attorney general. A list of all Protection and Advocacy agencies nationwide is available here, and your state attorney general’s office information can be found at this link. You are also encouraged to locate assistance through our Directory of Programs to obtain legal advice on how to proceed. Many pro bono and legal aid organizations have guardianship specialists who may be able to help.
8. What is a “VA fiduciary”? Why would the VA say that my veteran needs a fiduciary?
If the VA determines that your veteran lacks capacity in a way that interferes with his or her ability to manage financial affairs, the VA will appoint someone to serve as a VA fiduciary. The VA fiduciary is somewhat similar to a “guardian of the estate” (described above) with three important limitations: First, the fiduciary is appointed by a court, and second, the fiduciary is in charge of administering only those benefits the veteran receives from the VA. In some cases, this responsibility may extend to administration of all of the veteran’s financial matters if his or her VA benefits income is combined, as in a checking account, with the veteran’s other funds. Third, the VA, and not the court, will have oversight.
Generally the VA will find that a veteran requires a fiduciary based upon the medical condition giving rise to the claim to VA benefits in the first place. But if a veteran has been determined to be lacking capacity as a part of a guardianship proceeding (described above), that may also be an instance where the VA will select a fiduciary, which may or may not be the court-appointed guardian.
One other point regarding the VA Fiduciary Program: In addition to wounded veterans, a VA fiduciary may also be required to be appointed for a veteran’s beneficiary if that beneficiary receives VA benefits. So, for example, if a deceased veteran has a spouse who is eligible for the veteran’s VA benefits, but the spouse is incapacitated due to mental illness, the VA may require a fiduciary for the spouse. Similarly, a minor child of a deceased veteran may have a fiduciary required in order to receive the veteran’s benefits (which may be the child’s surviving parent). You can learn more about how the Fiduciary Program works by visiting the VA website at this link.
9. The VA has said that my veteran is “incompetent” and therefore needs a fiduciary. Is this the same as “incapacitated” for purposes of a guardianship? Can I obtain a guardianship for my veteran if the VA says he’s incompetent?
One important thing to be aware of when dealing with the VA: It tends to use terminology that has very specific meanings under the law, but has very different meanings in the way it is used by the VA. “Incapacity” in the guardianship context is a legal status that is determined by a court after a thorough review and assessment of objective evidence about a person’s physical and mental condition. The VA determines that someone is “incompetent” based upon a VA rating decision, a court decree, or both a VA rating decision and a court decree. The VA generally receives incompetency information from VA examinations, VA outpatient treatment records, private treatment records, or a court order that a beneficiary may be unable to manage his or her financial affairs (including disbursement of VA funds).
A VA incompetency determination for purposes of appointment of a fiduciary concerns only the beneficiary’s inability to manage VA benefits and is not the same as “incompetency” under guardianship law. (States at one time used the outmoded word “incompetency” for guardianship, but most state laws no longer do so.) The VA can determine someone “incompetent” simply by having a field manager meet with the veteran, talk to family members, and conduct whatever background review the field manager deems appropriate. It is a far less rigorous process and therefore is not the same as “incapacity” under the state guardianship law. A determination of
incompetence by the VA can be used as evidence presented in a guardianship proceeding, but a court is not required to find a veteran incapacitated just because the VA has said so.
You may also find other confusing uses of terms by the VA—for example, the VA may use the term “guardian” and “fiduciary” interchangeably. So keep in mind that a “guardian” is someone appointed by a court, as described above; a “VA fiduciary” is someone appointed by the VA to oversee an incompetent beneficiary’s funds. While they can sometimes be the same thing (as when a court appoints a guardian who is also designated by the VA to serve as fiduciary), they are not always, by definition, the same.
All of that said, regardless of whether your veteran needs a guardianship, if you believe that he or she would benefit from a fiduciary, you can request this directly from the VA. Contact your local VA office and ask for the form to request a fiduciary. Evidence you will need to provide the VA to start the process will include
your veteran’s disability determination and rating, if this has been done and is related to the need for a fiduciary,
if a guardianship has been established, copies of the court papers, and/or your own written opinion about why your veteran needs a fiduciary.
Upon receipt of this request, the VA will have a field examiner investigate the need for appointment of a fiduciary and make a determination.
10. If I request appointment of a fiduciary, what can I expect to be asked by the field examiner?
Following the receipt of notice of your veteran’s incompetency or legal disability, the VA will appoint a field examiner to personally assess the competence of your veteran in an initial appointment. In the initial appointment the field examiner will base his or her assessment on your veteran’s “capacity to manage funds.”
The assessment of your veteran’s “capacity to manage funds” is determined in part by your veteran’s ability to comprehend the amount and source of his or her income, the extent to which your veteran can comprehend the types and amount of his or her
the amount of money your veteran handles and the prudence he/she exercises in managing such funds, and
your veteran’s current circumstances compared to his or her history.
In addition to assessing your veteran’s capacity to manage funds, the field examiner will also inquire into your veteran’s physical and mental condition. In evaluating your veteran’s physical and mental condition, the field officer may ask questions and seek information relating to your veteran’s
physical limitations, mental condition,
orientation to time, place, and events,
ability to communicate and respond to questions, current medications, and
health problems and prognoses.
The field examiner may also evaluate your veteran’s social adjustment and perhaps work experiences. This may be determined by information about
your veteran’s social relationships, how your veteran spends his/her time, when your veteran last worked,
the field examiner’s estimation of your veteran’s work capability, and capacity to be trained for work.
Along with inquiring into your veteran’s social and industrial adjustment, the field examiner will also evaluate your veteran’s environment. The field examiner’s evaluation of your veteran’s environment may involve questions relating to your veteran’s
household members and their relationship to your veteran, standard of living,
conditions adverse to your veteran’s welfare, and attempts made to remedy them, such as problems with the home, inaccessibility of services in the community, and the like.
Further, you may be asked to provide information on or access to your veteran’s
savings and checking accounts (number, type, and balance for each account), vehicles (year, make, model, and ownership),
real estate (location, rental income, approximate value, and percent ownership), expensive luxury items,
investments (stocks, bonds, and trust accounts),
income sources and amount for your veteran and his or her dependents, and the identity of the payor of that income,
current and anticipated expenses (including charge or loan account numbers and balances),
dependents (relationship, needs, allowances, addresses, and telephone numbers), current bank statements or annotated savings passbook,
your veteran’s next of kin and how to contact them, and
whether your veteran has an existing VA home loan, and the number of the loan and the address of the property.
11. Who is eligible to be the VA fiduciary? Can a spouse or parent that provides care for the veteran automatically become the fiduciary? And what if there is a power of attorney in place?
There are several kinds of people that may be appointed as a VA fiduciary for a veteran. When determining who should serve as fiduciary, the VA first considers the veteran’s preference. A spouse or parent is most often selected as a fiduciary, but the fiduciary could be someone else, such as a court-appointed guardian or the chief officer of a care facility where the veteran is receiving treatment or is institutionalized (if the veteran has no spouse or children and the benefits are paying for the veteran’s care). When no other appropriate person or entity is willing to serve without a fee, the VA may appoint a “paid federal fiduciary,” who may be a person the veteran doesn’t even know, and who receives up to a 4 percent commission out of the veteran’s benefits for providing the service.
As to eligibility, there are several requirements to become a fiduciary. The VA conducts a “field examination” prior to the appointment of a fiduciary, which includes a face-to-face meeting with the veteran at the veteran’s residence. The VA also conducts a face-to-face meeting with the prospective fiduciary and conducts an investigation that includes a review of the individual’s credit history and criminal background. To prevent the misuse of benefits, the VA thoroughly investigates all fiduciaries prior to their appointment. In selecting a fiduciary, the field examiner will first determine the most effective, practical, and/or economical type of fiduciary appropriate to the situation, while also considering your veteran’s own requests. To be appointed as your veteran’s fiduciary, the field examiner must determine that you are “suitable” to serve in such a capacity.
To determine your “suitability,” the field examiner may request that, in addition to being present at a face-to-face interview, you provide information and documentation relating to your
full name, date of birth, address, occupation,
relationship to your veteran, educational level,
credit report information (though see exceptions below),
criminal background (the nature, length of time since the offense occurred, and evidence of your rehabilitation for any offense that resulted in your imprisonment),
character (statement of at least one witness who is unrelated to you, including the witness’s name, address, relationship to you, length of time the witness has known you, your relationship with your veteran, and your reputation for honesty and integrity—this does not apply if seeking an institutional fiduciary such as a medical facility),
agreement to abide by any agreement as to fund use and reporting, and
understanding of the duties and responsibilities involved with serving as a fiduciary. The requirement to have a credit report review may be waived for
the parent (natural, adopted, or stepparent) of a beneficiary who is a minor and will be receiving lump sum proceeds of VA insurance, or
the spouse of a veteran, or a court-appointed fiduciary, or
an individual appointed to manage an estate where the annual amount of benefits to be managed by the proposed fiduciary does not exceed $3,600, as adjusted annually in the same manner as the adjustments to Improved Pension, or
an individual currently serving satisfactorily as a VA fiduciary, or a fiduciary having a bond acceptable to the VA.
Once appointed, the fiduciary must comply with VA rules about segregating the veteran’s funds, reporting to the VA about the use of funds, and any other oversight that the VA exercises over the fiduciary. VA oversight is necessary to ensure the veteran’s needs are met and to prevent financial abuse of the veteran by the fiduciary. The VA also has the power to replace a fiduciary. While it may be preferable that a spouse or parent serve as fiduciary, the process is not
automatic. If the VA determines that the veteran is incompetent, determined to need a fiduciary, and you are a spouse or parent wishing to be appointed as fiduciary, you should contact the VA Regional Office that sent you the letter of determination. Notify the Regional Office of your desire to serve as a fiduciary and provide your contact information.
Finally, whether there is a power of attorney in place may have no bearing upon the selection of the fiduciary by the VA. If you have a power of attorney and the VA has selected someone else to serve as fiduciary against your wishes, you should first seek legal advice about whether you may appeal the appointment on behalf of the beneficiary. Our Directory of Programs provides you legal resources in your community that may be able to help you with this. Of course, if you are the agent under a power of attorney, you may have authority over other matters outside of VA benefits.
12. If I don’t approve of the person appointed by the VA as my veteran’s fiduciary, or if the fiduciary is doing a bad job, how do I address this?
Only the beneficiary can challenge the VA’s decision. The beneficiary or the designated VA representative (under a power of attorney) should begin the appeal process by filing a Notice of Disagreement with the VA Regional Office that appointed the fiduciary.
13. Does a determination of incompetence for financial purposes have implications for the veteran that extend beyond just financial issues?
The VA’s determination of incompetence is utilized by the VA in determining whether the veteran can manage his or her financial affairs related to VA benefits and therefore requires a fiduciary. If the veteran has been deemed incapacitated by a court as a part of a guardianship proceeding, however, the court may transfer the veteran’s authority to make his or her own decisions about all manner of issues to the guardian. These restrictions will be spelled out in the court’s order.
All of that said, you may be surprised to learn that a determination of incompetence by the VA will result in a veteran’s loss of the ability to own or obtain a firearm or ammunition. The Brady Bill imposes this limitation on those determined incompetent by the VA. This restriction is spelled out in the letter from the VA to the beneficiary that is sent when the VA determines a fiduciary may need to be appointed.
14. If I have been appointed the VA fiduciary of a veteran, what happens if the veteran undertakes financial activities unbeknownst to me, such as taking out a car loan without my knowledge?
If you have been appointed as a guardian by a court, the court’s order will very clearly spell out what types of decisions the guardian is legally entitled to make for the veteran. The veteran will no longer have the legal ability to make these decisions and the validity of the transaction would have to be verified. Visit our Directory of Programs for a resource near you that can provide you with this legal advice.
As a VA fiduciary, you are responsible for ensuring that the use of the veteran’s VA funds is prudent and in his or her best interest. Whether you should honor a financial obligation depends on the circumstances and the funds available. The best prevention for a VA beneficiary entering into a transaction without a fiduciary’s knowledge is to communicate with the beneficiary. The beneficiary should know that the fiduciary will consider favorably any reasonable purchase and will facilitate the transactions. You are responsible for making decisions based upon the
beneficiary’s unique circumstances, needs, desires, beliefs, and values. Beneficiaries in the fiduciary program are entitled to the same standard of living as a beneficiary with comparable resources who is not in the program.
As a fiduciary, you have an obligation to protect VA benefits from creditors’ claims. In addition, there are steps you can take to prevent the occurrence of financial transactions made without your knowledge. You must keep open and regular communications with the veteran about his or her VA benefits. Also, there are several rules to follow when managing VA benefits for the veteran. First, you must establish an account in the veteran’s name and your name and identify the fiduciary relationship with the bank. The bank can help you establish who has ownership and access to the account. VA benefit funds must be direct-deposited into the account. Do not give the account number to the veteran and safeguard all passwords.
If you have questions about the financial activities or suspect financial exploitation of your veteran, contact the VA Fiduciary Program the following toll free number: 1-888-407-0144. A VA fiduciary, such as a Social Security Representative Payee, only affects management of the benefits paid by the program. Even a power of attorney does not limit the ability of the veteran to enter into contracts. A guardianship may be necessary if the veteran has a significant loss of capacity and continues to undertake harmful financial activities. On the other hand, if you are both the VA fiduciary and a court-appointed guardian of a veteran who has been determined by a court to have a mental condition that necessitated the guardianship, any contract that the veteran enters into will be deemed invalid unless you choose to ratify it. So if your veteran has entered
into a contract and you object, it may be a matter for your guardianship court to resolve—you should consult your attorney.
15. Under what circumstances would the VA require a fiduciary to be bonded? How does this work, and is there any way to challenge this decision by the VA?
The VA may, at its discretion, require that a fiduciary obtain a corporate surety bond in order to protect the interests of the beneficiary. This means that the fiduciary is pledging personal assets as a type of insurance against his or her actions in performing the fiduciary duties. If the
fiduciary does not meet his or her obligations, this may result in personal liability under the bond. Whether to require a bond, and for how much, is a decision made by the Veterans Service Center Manager on a case-by-case basis. If you receive a notice from the VA requiring you to obtain a bond, you may file a Notice of Disagreement in a process similar to that described above for contesting appointment of a fiduciary. Explain your reasons for disagreeing.
There is no actual form to use when filing a Notice of Disagreement—you may either prepare a letter to the VA titled (in big, bold lettering at the top) “Notice of Disagreement,” or you may use VA Form 21-4138 and, again, write on it that it is a Notice of Disagreement. Then explain your reasons for disagreeing. Be aware that the VA is authorized, as an alternative to requiring a bond, to allow you to instead agree to set up a dedicated account into which the veteran’s benefits are paid and withdrawn only with the consent of the VA. Regardless, if you disagree with the requirement of a bond, you may want to seek out legal help from our Directory of Programs.
16. If I expend my own out-of-pocket funds to fulfill my obligations as a fiduciary, what are the rules about reimbursing myself from my veteran’s funds?
The VA Fiduciary Program works to ensure that fiduciaries are not utilizing their veteran’s funds for their own personal gain. There are certain circumstances under which a fiduciary may receive a small percentage commission from the veteran’s funds in exchange for service in a fiduciary role—this is when a professional fiduciary is appointed (described above). It does not apply when a nonprofessional (i.e., a family member or friend) is appointed. That said, it may be possible for any fiduciary to be reimbursed as described above. Regardless of the circumstances, if you are a fiduciary, you should never take any of your veteran’s funds for your own use without first receiving permission, preferably in writing, from the Fiduciary Program Manager at the VA. Without this permission, even if you are using the funds for what seems a totally
justified purpose, it may appear that you are misappropriating your veteran’s funds, for which you may be held civilly or criminally liable.