[Code of Federal Regulations]
[Title 38, Volume 1]
[Revised as of January 1, 2007]
From the U.S. Government Printing Office via GPO Access
[CITE: 38CFR13.105]

[Page 565]
 
            TITLE 38--PENSIONS, BONUSES, AND VETERANS' RELIEF
 
                CHAPTER I--DEPARTMENT OF VETERANS AFFAIRS
 
PART 13_VETERANS BENEFITS ADMINISTRATION, FIDUCIARY 
 
Sec. 13.105  Surety bonds.

    (a) Federal fiduciaries. (1) The Veterans Service Center Manager may 
require a legal custodian, custodian-in-fact or chief officer of a 
private institution recognized to administer Department of Veterans 
Affairs benefits on behalf of a beneficiary, to furnish a corporate 
surety bond in an amount determined to be sufficient to protect the 
interest of the beneficiary. Such bond shall run to the Secretary of 
Veterans Affairs for the use and benefit of the beneficiary.
    (2) The Veterans Service Center Manager may require a legal 
custodian to furnish an agreement in lieu of a surety bond or additional 
surety bond when funds are deposited in an interest or dividend-paying 
account in a State or federally insured institution. The agreement will 
provide that the legal custodian and institution agree that all funds 
received from the Department of Veterans Affairs on behalf of the 
beneficiary, which have been or will be deposited by the legal custodian 
in the account, will be withdrawn only with the written consent of the 
Veterans Service Center Manager or designee.
    (b) Substitution of surety; claims against defunct companies. If any 
surety company is placed in receivership or ceases to do business in the 
particular State, the Veterans Service Center Manager will take the 
necessary action to have proper bonds substituted in Federal fiduciary 
cases and refer the matter to the Regional Counsel for such other action 
as may be appropriate.

(Authority: 38 U.S.C. 501)

[40 FR 54250, Nov. 21, 1975]