Compliance Question of the Week – January 17th 2012

Under the VA Fiduciary Program, the Department of Veterans Affairs (VA) may appoint a person or entity in a representative capacity as “fiduciary.” The fiduciary is to receive monies paid under any of the laws administered by the Secretary of the VA for the use and benefit of a minor, veteran, or other beneficiary who has been determined to be unable to manage their financial affairs.

A good analogy to these VA fiduciary accounts would be the SSA Representative Payee accounts.

  • The fiduciary will be appointed from the VA and receive a letter showing the appointment.
  • The account(s) will be solely owned by the beneficiary.
  • Since the beneficiary has been deemed unable to manage their financial affairs, they would not have access to the account(s).
  • The fiduciary is to use the funds for the care and maintenance of the beneficiary.
  • No commingling of funds is allowed.
  • Excess money must be conserved in an interest-bearing account or U.S. Savings Bonds (the NWCUA recommends opening both checking and savings accounts).
  • The fiduciary must file regular reports and keep accurate records.

Some things that are unique to the VA fiduciary accounts:

  • Fiduciary is prohibited from withdrawing cash by either a counter check or ATM withdrawal.
  • Fiduciary must return any of the beneficiary’s money to the VA if they stop serving as the fiduciary.

You should title the VA fiduciary account as follows:

(Beneficiary’s Name), by (Fiduciary’s Name, Federal Fiduciary).

Related Links

VA Fiduciary Program


Questions? Contact the Compliance Hotline: 1.800.546.4465, compliance@nwcua.org.

Posted in Compliance.