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United States Government Accountability Office: 

Incapacitated Adults: 


Before the Committee on the Judiciary, Subcommittee on Administrative 
Oversight and the Courts, U.S. Senate: 

For Release on Delivery: 
Expected at 2:30 p.m. EDT:
Thursday, September 22, 2011: 

Improving Oversight of Federal Fiduciaries and Court-appointed 

Statement of Kay E. Brown, Director: Education, Workforce, and Income 


Chairman Klobuchar, Ranking Member Sessions, and Members of the 

I am pleased to participate in today's hearing on the appointment and 
oversight of guardians. As people age, they often reach a point when 
they are no longer capable of handling their own finances or have 
difficulty making other decisions for themselves. To ensure that 
federal cash payments received by incapacitated adults[Footnote 1] are 
used in their best interest, the Social Security Administration (SSA), 
Department of Veterans Affairs (VA), and other federal agencies assign 
a responsible third party or fiduciary[Footnote 2] to oversee these 
benefits. SSA and VA can designate spouses, other family members, 
friends, and organizations to serve as fiduciaries. Similarly, when 
state courts determine that adults are incapacitated, they have the 
authority to grant other persons or entities--guardians[Footnote 3]-- 
the authority and responsibility to make financial and other decisions 
for them.[Footnote 4] 

Incapacitated adults are vulnerable to financial exploitation by 
fiduciaries and guardians, so these arrangements are not without risk. 
In 2010, we identified hundreds of allegations of abuse, neglect, and 
exploitation by guardians in 45 states and the District of Columbia 
between 1990 and 2010. At that time, we reviewed 20 of these cases and 
found that guardians had stolen or otherwise improperly obtained $5.4 
million from 158 incapacitated victims, many of whom were older 
adults.[Footnote 5] To protect against financial exploitation, state 
courts as well as federal agencies are responsible for screening 
prospective guardians and federal fiduciaries, respectively, to make 
sure suitable individuals are appointed. They are also responsible for 
monitoring the performance of those they appoint. 

My remarks today are based on our recent report on this topic. 
[Footnote 6] They will cover (1) SSA and VA procedures for screening 
prospective federal fiduciaries, and state court procedures for 
screening prospective guardians; (2) SSA and VA monitoring of federal 
fiduciary performance, and state court monitoring of guardian 
performance; (3) information sharing between SSA and VA fiduciary 
programs and between each of these programs and state courts; and (4) 
federal support for improving state courts' oversight of guardianships. 

Findings in the report are based on interviews with federal officials 
and state court officials and experts in this area. We also reviewed 
relevant federal laws, regulations, policies and procedures, as well 
as summaries of state guardianship laws compiled by other 
organizations. We did not independently review implementation of the 
laws, regulations, or policies referred to in the report. We also 
incorporated findings from prior work in which we proactively tested 
state guardian certification processes in four states: Illinois, 
Nevada, New York, and North Carolina.[Footnote 7] 

We conducted our previous work from June 2010 to June 2011 in 
accordance with generally accepted government auditing standards. 
These standards require that we plan and perform the audit to obtain 
sufficient, appropriate evidence to provide a reasonable basis for our 
findings and conclusions based on our audit objectives. We believe 
that the evidence obtained provided a reasonable basis for our 
findings and conclusions based on our audit objectives. 

In summary, we found that SSA and VA are required to and have 
procedures for screening prospective fiduciaries and are also required 
to monitor fiduciary performance. Most states, as well, have laws 
requiring courts to follow certain screening procedures for 
prospective guardians and to obtain annual reports from them, but 
there is evidence that courts often find monitoring guardian 
performance challenging. SSA and VA do not systematically share with 
one another the identities of beneficiaries determined to be 
incapacitated or the identities of fiduciaries who have misused an 
incapacitated adult's benefit payments, and there is evidence that 
state courts have difficulty obtaining similar information from SSA 
about SSA beneficiaries the courts have determined to be incapacitated 
and in need of a guardian. Finally, the federal government has a 
history of supporting technical assistance and training for state 
courts related to guardianship, primarily with funding from the 
Administration on Aging (AoA) in the Department of Health and Human 
Services (HHS). 

SSA, VA, and Most State Courts Are Required to Screen Fiduciaries or 

SSA, VA, and most state courts are required to follow screening 
procedures for ensuring that prospective fiduciaries and guardians are 
suitable to serve. SSA and VA strive to prevent individuals who have 
misused beneficiaries' payments from serving again, and each agency is 
currently developing an automated system that will enhance its ability 
to compile and maintain information about fiduciaries who have misused 
cash benefits. 

Similarly, according to the AARP Public Policy Institute, most states 
require courts to follow certain procedures for screening prospective 
guardians and restrict who can be a guardian.[Footnote 8] Thirteen 
states require prospective guardians to undergo an independent 
criminal background check before being appointed. Nine prohibit 
convicted felons, and two prohibit convicted criminals from serving. 
However, these screening procedures are not always effective. Using 
two fictitious identities--one with bad credit and one with the Social 
Security number of a deceased person--GAO obtained guardianship 
certification or met certification requirements in the four test 
states where we applied. 

SSA and VA Have Procedures for Monitoring Fiduciaries, but Monitoring 
Guardians Can Be Challenging for Many Courts: 

SSA and VA have similar procedures for monitoring fiduciary 
performance. SSA is required to establish a system of accountability 
monitoring that includes periodic reports from fiduciaries.[Footnote 
9] Certain organizational fiduciaries and individuals serving as an 
SSA fiduciary for 15 or more beneficiaries are also subject to 
periodic on-site review.[Footnote 10] VA requires its fiduciaries to 
submit a two-page accounting report but asks those who are also court-
appointed guardians to submit the same accountings that they submit to 
the court. Similar to SSA, VA is required to conduct periodic on-site 
reviews of certain organizational fiduciaries, as well,[Footnote 11] 
and also conducts periodic site visits with incapacitated 
beneficiaries to reevaluate their condition and determine if their 
fiduciaries are properly using their payments. 

Most states require court-appointed guardians to be monitored in some 
way, but according to an AARP Public Policy Institute report, in many 
states there are only limited resources to do so.[Footnote 12] The 
American Bar Association (ABA) Commission on Law and Aging[Footnote 
13] has found that most states require courts to obtain annual reports 
from guardians on their incapacitated adult's condition, among other 
things.[Footnote 14] In some states, court investigators may visit 
guardians and their wards either regularly or on an as-needed basis. 

Monitoring court-appointed guardians' performance can prevent 
financial exploitation of incapacitated adults and stop it when it 
occurs. In our 2004 survey of state courts, most indicated they did 
not have sufficient funds to oversee guardianships.[Footnote 15] In 
its 2007 report, the AARP Public Policy Institute indicated that 
sufficient resources were not available to fund the staff, technology, 
training, and materials needed to effectively monitor guardians even 
though, according to Institute officials, judges and court 
administrators would like to improve guardianship monitoring. AARP has 
identified a number of promising practices to strengthen court 
monitoring or guardianship.[Footnote 16] It has also noted that some 
state courts have begun to adopt these practices, but progress appears 
to be slow. Given limited resources for monitoring, courts may be 
reluctant to invest in these practices without evidence of their 
feasibility and effectiveness. The federal government has an 
opportunity to lead in this area by supporting evaluations of the 
feasibility, cost, or effectiveness of promising monitoring practices. 

Information Sharing Between SSA, VA, and State Courts Could Improve 
Protection of Incapacitated Adults: 

Sharing certain information about beneficiaries and fiduciaries 
between SSA and VA enhances their ability to protect the interests of 
incapacitated beneficiaries by better ensuring that suitable 
fiduciaries are appointed. Although the Privacy Act generally 
prohibits a federal agency from disclosing personal information from a 
system of records without the consent of the individual to whom the 
record pertains, an agency may disclose such information without 
consent if there is a published statement of routine use that permits 
this disclosure.[Footnote 17] According to SSA officials, there is a 
routine use provision that allows SSA to disclose certain information 
about its beneficiaries to VA, and there is a current data exchange 
agreement between SSA and VA that allows VA to directly query an SSA 
automated system on a case-by-case basis. Through these queries, VA 
can learn key information such as whether or not SSA has appointed a 
fiduciary for a beneficiary and the identity of the SSA fiduciary. On 
the other hand, SSA officials indicated that obtaining similar 
information from VA may not be cost-effective given the relatively 
small proportion of SSA beneficiaries who also collect VA benefits. 

With regard to state courts' access to SSA information about its 
incapacitated beneficiaries and their fiduciaries, this information 
could provide courts with potential candidates for guardians when 
there are no others available. Further, when SSA's automated system 
that will track fiduciaries who have misused benefits is complete, 
this information could help state courts avoid appointing individuals 
who, while serving as SSA fiduciaries, misused beneficiaries' SSA 
payments. Although the National Research Council has emphasized the 
importance of information sharing between SSA and the courts,[Footnote 
18] officials from organizations representing elder law attorneys, and 
advocating for elder rights, told us it is difficult for state courts 
to obtain information from SSA when it is needed. SSA officials do not 
believe their agency is permitted to provide information to state 
courts about an SSA beneficiary, or that beneficiary's SSA fiduciary, 
without the beneficiary's consent because there is no statement of 
routine use under the Privacy Act allowing it to do so. Moreover, 
officials said the agency has not considered establishing a routine 
use statement because SSA believes that sharing this information with 
state courts would not be compatible with the purpose for which the 
information was collected. Furthermore, agency officials told us that 
since disclosure of information to state courts is outside its 
mission, it could not use appropriated funds for this purpose and 
would have to charge courts for this information. 

Regarding information sharing between VA and state courts, according 
to a VA official, the agency has no written policy on how requests for 
information about VA beneficiaries from state courts that appoint 
guardians should be handled. However, in guardianship proceedings 
involving VA beneficiaries, the agency does share its information 
about these beneficiaries with a court when a court requests this 
information. VA also has data-sharing agreements with courts in two 
counties and has reached out to organizations representing elder law 
attorneys and guardians to promote VA and state court information 

The Administration on Aging Has Taken Some Steps That Could Help State 
Courts Improve Guardianship Oversight: 

In 2008, AoA established the National Legal Resource Center (NLRC), in 
part to support demonstration projects designed to improve the 
delivery of legal assistance and enhance elder rights protections for 
older adults with social or economic needs.[Footnote 19] AoA funding 
enabled NLRC partners to provide training, case consultation, and 
technical assistance related to guardianship, including: 

* assistance drafting and promoting adoption of a model state law that 
would resolve long-standing issues with interstate transfer and 
recognition of guardianship appointments,[Footnote 20] 

* evaluation of Utah's public guardian program, and: 

* revision of guardianship provisions in South Carolina's probate code. 

According to AoA officials, the agency has also supported development 
of guardianship training modules[Footnote 21] for elder law attorneys 
and a guardianship webinar. AoA has not, however, recently supported 
any demonstrations or pilots to help evaluate guardian monitoring 
practices. Because of its activities in the guardianship area, the 
federal government is well-positioned and has an opportunity to lead 
in protecting the rights of incapacitated adults with court-appointed 
guardians, in particular by supporting evaluations of promising court 
guardianship monitoring practices. 

We made two recommendations in our report. Our first calls for SSA to 
take whatever measures necessary to allow it to disclose certain 
information about SSA beneficiaries and fiduciaries to state courts, 
upon their request, including proposing legislative changes to address 
the impediments it identified. SSA has not identified what steps, if 
any, it will take to address this recommendation. 

We also recommend that HHS direct AoA to consider supporting the 
development, implementation, and dissemination of a limited number of 
pilot projects to evaluate the feasibility, cost, and effectiveness of 
one or more generally accepted promising practices for monitoring 
guardians. In response, HHS agreed that AoA has the authority to take 
such action. 

This concludes my statement. I would be pleased to respond to any 
questions you or other members of the Subcommittee may have. 

GAO Contacts and Acknowledgments: 

For questions about this testimony, please contact Kay E. Brown at 
(202) 512-7215 or Contact points for our Offices of 
Congressional Relations and Public Affairs may be found on the last 
page of this statement. Individuals who made key contributions to this 
testimony include Clarita Mrena, Jaime Allentuck, David Perkins, 
Jessica A. Botsford, and Sheila R. McCoy. 

[End of section] 


[1] Here the term "incapacitated" is used recognizing that federal 
agencies and states use a variety of terms and somewhat different 
definitions to assess whether someone is in need of a guardian. SSA, 
for example, assigns a fiduciary to people it has determined are 
incapable of managing or directing the management of benefit payments. 
VA uses the term "incompetent" instead of incapacitated. Most states 
use a term such as "incapacitated," but others use such terms as 
"incompetent," "mentally incompetent," "disabled," or "mentally 

[2] VA refers to these responsible parties as fiduciaries. SSA refers 
to them as representative payees. Here the term "fiduciary" is used to 
refer to both VA fiduciaries and SSA representative payees. 

[3] As used here, the term "guardian" also includes conservators. 

[4] The responsibilities of federal fiduciaries and court-appointed 
guardians differ in a number of ways. Federal fiduciaries oversee only 
federal cash payments while guardians typically manage all of an 
incapacitated adult's property. Moreover, guardianship is usually a 
legal relationship under which the incapacitated adult typically 
forfeits some or all civil liberties. This is not the case under 
federal fiduciary programs. 

[5] GAO, Guardianships: Cases of Financial Exploitation, Neglect, and 
Abuse of Seniors, [hyperlink,] 
(Washington, D.C.: Sept. 30, 2010). These case studies reflect varied 
guardianship arrangements, and their findings cannot be projected to 
the overall population of guardians. 

[6] GAO, Incapacitated Adults: Oversight of Federal Fiduciaries and 
Court-Appointed Guardians Needs Improvement, [hyperlink,] (Washington, D.C.: July 22, 

[7] [hyperlink,]. 

[8] The AARP Public Policy Institute was created to inform and 
stimulate public debate on the issues related to aging and to promote 
development of sound, creative policies to address the common need for 
economic security, health care, and quality of life. This information 
is from a compilation of state guardianship laws provided to us by 

[9] 42 U.S.C. §§ 405(j)(3)(A) and 1383(a)(2)(C). 

[10] 42 U.S.C. §§ 405(j)(6)(A) and 1383(a)(2)(G)(i). 

[11] 38 U.S.C. § 5508. 

[12] AARP Public Policy Institute. Guarding the Guardians: Promising 
Practices for Court Monitoring (Washington, D.C.: 2007). 

[13] The ABA Commission on Law and Aging was created to strengthen and 
secure the legal rights, dignity, autonomy, quality of life, and 
quality of care of elders. It carries out this mission through 
research, policy development, technical assistance, advocacy, 
education, and training. 

[14] See "Monitoring Following Guardianship Proceedings (as of 
December 31st, 2009)" at [hyperlink,

[15] GAO, Guardianships: Collaboration Needed to Protect Incapacitated 
Elderly People, [hyperlink,] 
(Washington, D.C.: July 13, 2004). We surveyed California superior 
courts in each of California's 58 counties, circuit courts in each of 
Florida's 67 counties, and courts in each of New York's 12 judicial 
districts. We received usable survey responses from 42 California 
courts, 55 Florida courts, and 9 of New York's judicial districts for 
response rates of 72 percent, 82 percent, and 75 percent, respectively. 

[16] AARP Public Policy Institute. Guarding the Guardians: Promising 
Practices for Court Monitoring (Washington, D.C.: 2007). 

[17] The Privacy Act applies to personal information under the control 
of an agency that is maintained in a system of records, which is any 
group of personal information that is retrieved by the name of the 
individual or other identifier. Under the Privacy Act, each agency 
that maintains a system of records must publish a notice describing 
that system and include a statement of routine uses of those records, 
including the categories of the uses and the purpose of use. A routine 
use of a system of records must be compatible with the purpose for 
which the record was collected. 5 U.S.C. § 552a. 

[18] National Research Council, Improving the Social Security 
Representative Payee Program: Serving Beneficiaries and Minimizing 
Misuse, Committee on Social Security Representative Payees, Division 
of Behavioral and Social Sciences and Education (Washington, D.C.: The 
National Academies Press, 2007). 

[19] NLRC partners include the American Bar Association Commission on 
Law and Aging, the Center for Elder Rights Advocacy, the Center for 
Social Gerontology, the National Consumer Law Center, and the National 
Senior Citizens Law Center. 

[20] See [hyperlink,] ,12, 30-

[21] National Consumer Law Center. Nuts and Bolts on Guardianship as 
Last Resort: The Basics on When to File and How to Maximize Autonomy. 

[End of section] 

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