Colorado regulates compensation for veterans benefits consulting under new guidelines

On April 7, 2025, the Colorado State Legislature introduced Senate Bill 282, aimed at regulating compensation for individuals who assist veterans in securing benefits. The bill seeks to address concerns about the potential exploitation of veterans by ensuring that compensation for consulting services is contingent upon actual increases in benefits awarded.

Key provisions of Senate Bill 282 stipulate that individuals may only receive payment for their consulting services if they successfully secure an increase in benefits for the veteran. Compensation is capped at either $9,000 or 20% of any past-due benefits awarded, whichever is lesser. Additionally, the bill prohibits any upfront or non-refundable fees for these services, aiming to protect veterans from financial exploitation.

The legislation also includes a provision that bars compensation for claims filed within one year of a veteran's release from active duty, during which certain disabling conditions are presumed to be service-connected by the U.S. Department of Veterans Affairs. This aims to prevent individuals from profiting off veterans during a vulnerable period.

Debate surrounding the bill has highlighted concerns about the balance between ensuring veterans receive the assistance they need and protecting them from unscrupulous practices. Supporters argue that the bill is a necessary step to safeguard veterans, while opponents express concerns that the restrictions may limit access to valuable assistance for those navigating the complex benefits system.

The implications of Senate Bill 282 are significant, as it seeks to create a more transparent and fair process for veterans seeking benefits. Experts suggest that if passed, the bill could lead to a decrease in fraudulent practices while ensuring that veterans receive the support they deserve without incurring unnecessary costs.

As the legislative process continues, stakeholders from various sectors, including veteran advocacy groups and legal experts, are closely monitoring the bill's progress, anticipating its potential impact on the veteran community in Colorado.