Subcommittee hears divided testimony on bill to curb fee‑based veteran claim services; debate adjourned

The South Carolina House Military and Veterans Affairs Subcommittee spent the morning hearing hours of testimony on S.695, the South Carolina Safeguarding American Veterans Benefits Act, which would require that paid claims services memorialize fee terms and would impose penalties for noncompliance while exempting licensed attorneys and federally accredited representatives.

Secretary McCaffrey of the South Carolina Department of Veterans Affairs told the committee the department supports the bill and placed the discussion in fiscal context: "The US department of veterans affairs annually disperses $125,000,000,000 in disability benefits nationally. In South Carolina, that number is $6,400,000,000 per year to South Carolina veterans," he said, adding that federal accreditation rules prohibit accredited representatives from charging for claims services and arguing the bill is consistent with credentialing practices intended to protect veterans.

Veterans who testified described lengthy waits and difficulty navigating the VA. "That is why we need to keep every available option on the table for our veterans," said Stan Joseph, a 21‑year Air Force veteran who described multiple deployments and years of effort to obtain benefits. Other veterans said they had paid for paid help to avoid years of delay.

The Veterans of Foreign Wars, represented by legislative chair Scott Craig, urged support for S.695 and accused some for‑profit, unaccredited firms of exploiting veterans. "They promise faster approvals, higher VA disability ratings, but in reality, they charge excessive illegal fees, taking large upfront payments, percentages of back pay, and portions of future benefits," Craig said, urging lawmakers to follow federal accreditation standards to ensure accountability.

Representatives of a trade association for fee‑based firms offered a different view. Peter O'Rourke, president of the National Association for Veterans Rights and a former acting secretary of the U.S. Department of Veterans Affairs as he described his background, told the panel that the industry is not per se illegal and urged regulatory guardrails rather than measures he said would prevent his members from operating in the state. He recommended fee‑cap proposals and certification as alternatives to an effective prohibition and discussed a model based on a "five‑times the monthly increase" fee approach and a proposed cap in the neighborhood of $12,500 in extreme cases.

Committee members probed differences between accredited representatives (who typically enter a power of attorney and share legal accountability) and unaccredited consultants (who often advise veterans who then self‑file). Rep. Holman pressed several witnesses on whether veterans would accept paying high fees if it meant securing a full award.

Rather than holding a final vote on S.695, Rep. Holman moved to "adjourn debate" to allow more testimony and fuller committee consideration. The clerk recorded a roll call on the motion: Chair Brandon Cox, Rep. Gilliard, Rep. Holman, Rep. Lastinger and Rep. White voted "Aye," and the motion carried. The subcommittee said it will bring the bill back for further consideration and complete committee review at a later date.

The hearing highlighted a split between veterans and VSOs who say the measure protects veterans from predatory fees and industry representatives who say certification or caps would be preferable to restrictions that could limit options for veterans. The subcommittee did not adopt S.695 or an amendment at this meeting and deferred further action.