NPRM Part VI -- Ethics -- And Those Loaded Words "Fiduciary" And "Profession"

I am not through talking about Social Security's Notice of Proposed Rule-Making (NPRM) on the representation of claimants. My topic today is provisions in the proposal concerning ethics for those who represent claimants. Let me just copy here the parts that I am talking about today:

All persons acting on behalf of a party seeking a statutory right or benefit must, in their dealings with us, faithfully execute their duties as agents and fiduciaries of a party. ...

A representative must ... Conduct the representative’s dealings in a manner that furthers the efficient, fair, and orderly conduct of the administrative decision-making process, including duties to:

• This includes knowing the significant issue(s) in a claim and having a working knowledge of the applicable provisions of the Social Security Act, as amended, the regulations and the Rulings;
• This includes providing prompt and responsive answers to requests from the Agency for information pertinent to processing of the claim; ...

A representative must not:

• Through the representative’s own actions or omissions, unreasonably delay or cause to be delayed, without good cause (see § 404.911(b)), the processing of a claim at any stage of the administrative decision-making process;
• Attempt to influence, directly or indirectly, the outcome of a decision, determination or other administrative action by offering or granting a loan, gift, entertainment or anything of value to a presiding official, Agency employee or witness who is or may reasonably be expected to be involved in the administrative decisionmaking process, except as reimbursement for legitimately incurred expenses or lawful compensation for the services of an expert witness retained on a noncontingency basis to provide evidence;
• Threatening or intimidating language, gestures or actions directed at a presiding official, witness or Agency employee which results in a disruption of the orderly presentation and reception of evidence;
• Violate any section of the Social Security Act for which a criminal or civil monetary penalty is prescribed;
• Refuse to comply with any of our rules or regulations;
• Suggest, assist, or direct another person to violate our rules or regulations;
• Advise any claimant or beneficiary not to comply with any of our rules and regulations;
• Assist another person whom we have suspended or disqualified; or
• Fail to comply with our decision regarding sanctions.

This talks about a representative acting as a fiduciary. It seems to me that this means that failing to failing to behave as a fiduciary on behalf of a claimant is a punishable offense. The term fiduciary implies many important duties. Those duties vary somewhat from jurisdiction to jurisdiction, but having a conflict of interest is always forbidden. In this context, one example of a conflict of interest would be trying to represent a Social Security disability claimant while also working as a contractor for the Social Security Administration. There are a few people who attempt to work as a vocational expert for the Social Security Administration,while also trying to represent claimants. That raises my eyebrows. Does this proposal mean to end that? I hope so. Maximus is a large Social Security contractor, but also represents Social Security claimants. That seems wrong to me. Another example would be trying to represent Social Security claimants at the behest of an insurance company which has an adversarial relationship with the claimant. Allsup is not only doing this big time, but is also serving as a debt collector for the insurance companies. I hope that Social Security meant to forbid these sorts of relationships. This is not the sort of thing that a fiduciary should be doing.

If we are going to start down this path of regulating non-attorney representative conduct in a way that has some similarity to the regulation of attorneys, as the use of the word fiduciary implies -- and I think we should -- there are other duties that I think ought to be incorporated into the regulations, such as:

• Communicate with the client
• Maintain confidentiality of information received from the client
• Avoid sexual relations with the client
• Keep advertisements truthful
• Maintain independence from the influence of individuals or entities who are not professional representatives
  

We now have a large and growing group of individuals who have what amounts to an officially recognized license to represent Social Security claimants, which makes this group a profession. However, this nascent profession is not now subject to the sort of disciplinary rules that apply to attorneys and other professionals. If this group is a profession, it is time for them to accept, even welcome, the ethical responsibilities that go along with being a profession. If they are not a profession, they should not be getting this sort of government license.

To move on, a lot of what is in the proposal is vague, almost to the point of being unconstitutionally vague. Prompt and responsive answers? Unreasonably delay? Threatening or intimidating language, gestures or actions? Fail to comply with ANY of our rules or regulations? And why does this talk of rules AND regulations unless it intends to draw a distinction between the two, but the distinction is somewhere between elusive and non-existent, unless you want to include something like POMS as rules but not regulations. I think it would be ridiculous to discipline someone for violating something hidden away in the vast recesses of POMS. I know it can be hard to define a lot of this. Much falls into the category of "I know it when I see it," but this proposal is still awfully vague. Without something more specific Social Security will never be able to make charges stick unless the representative's conduct is really, really bad.

I am glad that this forbids representatives from assisting those who have been suspended or disqualified. I think it should also forbid assisting disbarred attorneys who have not been suspended or disqualified by Social Security.

I also suggest that a provision be added to forbid professional representatives from serving as institutional representative payees. There have been a number of criminal cases arising from what this proposal would call professional representatives serving as institutional representative payees. These two roles do not seem to mix well. It would be best to forbid this combination.

You may comment on this proposal online and I encourage you to do so. This proposal has many implications. There should be many comments.