The above fact situation is in accordance with Social Security policy, although it is a policy that is haphazardly implemented.
Queries: Does this policy make sense? Is the rare implementation of this policy an indication that it does not make sense? Does this policy unduly restrict a claimant's ability to obtain a new attorney if he or she moves or otherwise needs or wishes to change attorneys? Why does Social Security have such difficulty in developing policies concerning attorney fees? Why are there almost no regulations concerning attorney fees?
Update: Many of the comments say there is something wrong with the fact pattern given. The assumption is that this cannot possibly be correct. Social Security's manual states that:
SSA will not authorize to any co-representative the share of a co-representative who waived a fee. When SSA has withheld title II and/or title XVI past-due benefits for payment of a representative's fee, SSA releases the waived share to the claimant(s).This policy is being applied, haphazardly, to the fact situation given. Yes, the manual instructions can be read differently, but what is happening on the ground is chaotic and attorneys have no recourse. It is a mess.