California Governor Gavin Newsom has taken a strong stance against private companies that charge veterans exorbitant fees for helping them file disability claims with the Department of Veterans Affairs (VA). The new law, signed this week, effectively shuts down what critics call “claim sharks” - businesses that have been profiting off veterans’ hard-earned benefits.

These companies have been operating in a legal gray area, charging veterans thousands of dollars for assistance with VA claims. In one shocking example, a Vietnam-era veteran was billed $5,500 for help obtaining benefits that would pay him just $1,100 monthly. The fees often far exceed the actual benefit increase veterans receive.

While federal law technically already prohibited charging veterans for these services, a congressional loophole removed criminal penalties two decades ago, allowing these companies to flourish. Newsom’s legislation aims to close this loophole and protect veterans from financial exploitation.

The law has widespread support from veteran organizations like the American Legion and Veterans of Foreign Wars. Senator Bob Archuleta, a former Army officer who championed the bill, emphasized that “making millions of dollars on the back of our veterans is wrong”.

Interestingly, the legislation wasn’t without controversy. Some lawmakers, including Democrats with military backgrounds, argued that veterans should have the right to choose these services. Senator Tom Umberg criticized the bill as potentially infantilizing veterans.

Two claims consulting companies, Veterans Guardian and Veterans Benefit Guide, spent significant resources lobbying against the bill, with Veterans Benefit Guide alone spending over $371,000 in lobbying efforts.

Supporting the law, David West, a Marine veteran and Nevada County’s veterans service officer, praised Newsom for protecting young service members from predatory practices. “The veterans of California are going to know that when Newsom says he’s taking care of everybody, he’s including us,” West stated.

California is now one of 11 states taking decisive action against these claims consulting companies, signaling a growing national movement to protect veterans’ rights and benefits.