VA Warned Claims-Consulting Firms They May Be Breaking the Law — Most Are Still Operating

Over the past decade the Department of Veterans Affairs (VA) has sent more than 40 warning letters to companies that charge veterans for help with disability claims, saying those businesses may be violating federal law. Despite repeated notices, many firms remain open and in some cases have grown into multimillion-dollar operations.

What the letters reveal

Documents obtained under the Freedom of Information Act show the VA sent dozens of letters over the last 10 years telling claims-consulting companies to review their practices and "immediately cease" activities that could be illegal. An analysis of the records and company data found:

• At least 29 of the 38 companies named in VA letters still appeared to be operating as of late November.
• Twenty-nine companies had active business registrations, and 34 maintained websites or social media accounts.
• At least nine of the firms were registered as nonprofits.
• Several large firms — including VA Claims Insider, Trajector Inc. and Veterans Guardian — received multiple letters while expanding into sizeable businesses that lobby and spend on political advocacy.

How the firms operate

These companies typically offer to gather medical records, prepare evidence packets and guide veterans through appeals in exchange for fees. Some charge a flat fee or take a percentage of an increased benefit award; others charge thousands of dollars up front. Critics say that in many cases the fees far exceed what a veteran would pay for comparable services in other fields.

Some firms argue they do not break the law because they "prepare the person, not the claim," limiting their work to advice and evidence collection while saying they do not formally file claims. The VA has repeatedly told companies that distinction is often "a distinction without a difference" when the company is doing the substantive work of preparing or prosecuting claims for a fee.

Examples and controversies

Trajector Inc. (formerly Vet Comp and Pen Medical Consulting) received a 12-page VA letter in 2022 that warned it to "cease all preparation, presentation and prosecution of VA benefit claims" or face referral to law-enforcement authorities. Investigations have found Trajector used an automated dialing system it calls "CallBot" to monitor veterans' VA benefit accounts; when an increase was detected, Trajector would pursue veterans for payment — even when veterans said the company did not cause the increase.

Other firms named in VA correspondence have disputed the characterization of the VA letters and have even sent cease-and-desist letters to news organizations seeking to prevent publication. Company leaders sometimes publicly deny receiving VA warnings, and in at least one congressional hearing a company executive later acknowledged receiving a VA letter after lawmakers produced it.

Why enforcement remains limited

Experts and former officials say enforcement is hampered by gaps in federal law. About two decades ago Congress removed criminal penalties from the statute that would have punished unauthorized fee-charging for VA claims, limiting the VA to civil remedies like warning letters. As a result, many companies have ignored VA notices without facing immediate legal consequences.

"VA is not a law enforcement agency," said VA press secretary Pete Kasperowicz. He added the department works with law-enforcement partners when it sees signs of fraud but also wants veterans to have choices if they are dissatisfied with free assistance options.

Patchwork of state rules and lobbying

The regulatory landscape has become a patchwork: at least nine states have outlawed unaccredited firms from charging fees, while at least six states have passed laws that effectively legalize such businesses. Several large consulting firms have spent hundreds of thousands of dollars lobbying for state and federal laws that would explicitly allow fee-for-service claims assistance, including proposed fee caps as high as $12,500.

Some state lawmakers have pushed back. In California, legislators drafted a bill to ban many fee-charging firms and describe some practices as deceptive; the measure is scheduled for a state senate vote in January 2026. Supporters say state law can give attorneys general stronger enforcement tools than the VA currently has.

Veterans' experiences

Veterans' reactions are mixed. Some report faster resolutions and higher disability ratings after paying a consulting firm. Gage Coons, who left the Navy with a shoulder injury and PTSD, said he paid roughly $5,000 to a firm that helped raise his rating from 50% to 90% — a result he was willing to pay for because it provided quicker access to benefits than free alternatives.

Others warn the fees can exploit veterans during financially vulnerable periods. Critics say the high costs, aggressive marketing and limited accountability create a risky market for injured and disabled service members.

What to watch

Policymakers are debating several approaches: strengthen federal penalties; set state-level bans or fee caps; or reform accreditation and oversight so veterans can get reliable paid help under clearer rules. Meanwhile, the VA continues to send letters and to refer suspected fraud to law-enforcement partners when appropriate.

Reporting: Caley Fox Shannon, Chris Arnold and Quil Lawrence. Quotes and statements in this piece come from VA officials, company representatives and veterans cited in reporting.