Utah, U.S. veterans are targeted by ‘pension poachers’
Military • State official says victims are paying for services the VA offers for free.
Published: June 7, 2012 08:00AM
Updated: September 11, 2012 11:32PM
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Scott Sommerdorf | Tribune file photo Terry Schow, left, the executive director of the Utah Department of Veteran Affairs, estimates that Utah veterans at senior centers, nursing homes and assisted-living facilities are being approached by more than 20 companies or agents looking to take advantage of their pension benefits.

Utah veterans at senior centers, nursing homes and assisted-living facilities are being approached by more than 20 companies or agents looking to take advantage of their pension benefits, Terry Schow estimates.

Schow, executive director of the Utah Department of Veteran Affairs, collected the stories of seven exploited veterans and submitted them at a Wednesday hearing of the Senate Special Committee on Aging.

“There are some people who have taken the business of helping veterans into profit-making,” he said before the hearing.

Certain low-income veterans are entitled to pensions, and more than 200 agencies across the United States are “marketing financial products and services” to help veterans qualify for the benefits, according to a Wednesday report by the Government Accountability Office (GAO).

The yearlong investigation found that veterans who do not meet pension requirements are qualifying for and receiving the funding, often because they were encouraged to do so by private companies.

One veteran transferred $1 million just months before applying, and was approved to receive the monthly payments, the GAO found.

While transferring funds prior to applying for a pension is legal, taking any fee for enrolling a veteran for the benefits is illegal.

Many firms who market these services claim they charge a “counseling fee” ranging from hundreds of dollars to $10,000, according to testimony at Wednesday’s hearing.

Some Utah companies use names such as “Veterans Benefits Foundation,” leading veterans and their families to mistake the companies for affiliates of the VA, Schow said.

Utah victims who met with Schow lost between $250 and $16,500 to such scams.

“The sad thing is that we all do this [enrollment work] for free,” Schow said. “The price these people paid serving our country is all the price they need to pay.”

Sen. Ron Wyden, D-Oregon, is spearheading efforts to end to such practices. “This program has become a magnet for sleazy con men and rip-off artists,” he said Wednesday.

Sen. Claire McCaskill, D-Missouri, suggested making such “pension poaching” equivalent to criminal fraud.

“I think there’s a special place in hell for companies who take advantage of veterans in this way,” she said.

Wyden and Richard M. Burr, R-North Carolina, are proposing a bill to give the VA “look-back” authority, which would allow it to re-examine whether veterans granted pensions actually qualified.

David McLenachen, director of the VA’s Pension and Fiduciary Service, and Wyden also advocated making veterans who transfer assets ineligible for the pensions.

To qualify now, veterans must be over 65 or severely disabled, have served during wartime, and meet income guidelines. For example, a veteran with no dependents must have an income of less than $20,447 to qualify.

dferguson@sltrib.com