Billions of dollars set aside for veterans, firefighters, industrial workers and other Americans who were exposed to asbestos are being drained from trust funds that Congress authorized in the mid-1990’s.
Mesothelioma and other asbestos-related diseases often appear decades after an individual is exposed to asbestos. Without increased transparency in the system, asbestos trusts may be fleeced into nothingness and left unable to pay the veterans, first-responders, workers and other Americans who will become sick over the next ten, twenty, or even thirty years. That’s why seniors groups and veterans support the Furthering Asbestos Claim Transparency (FACT) Act, including a coalition that represents more than 600,000 veterans in my home state of Texas.
These decreases appear to be driven, at least in part, by fraud and abuse. A Wall Street Journal investigative report uncovered hundreds of inconsistencies between claims with trusts and in-court cases, as well as thousands of implausible claims that alleged children were exposed to asbestos while working in industrial settings.
There’s also strong evidence of fraud and abuse in asbestos lawsuits. Last year, a federal judge in North Carolina found that plaintiffs’ lawyers regularly withhold and manipulate essential evidence in asbestos cases.
Other judges agree. A Delaware judge explained that lying and non-disclosure “occurs a lot” in asbestos litigation.
That’s concerning in and of itself, but the same lawyers involved in asbestos lawsuits are filing claims with asbestos trust funds. Many even sit on special “advisory committees” that influence trusts’ payment decisions and audit procedures.
Who makes sure that lawyers aren’t cheating the trusts? The Government Accountability Office studied the trusts and found they operate without meaningful federal oversight. It also asked the trusts if their audits uncovered fraud. Their response? Although they have received hundreds of thousands of claims and paid out more than $20 billion, they haven’t been able to find any fraud. That’s unbelievable.
As witnesses before the House Judiciary Committee have explained, asbestos trusts are not “magically different” from other compensation funds. Fraud against the 9/11 Victims Compensation fund, for example, was detected and prosecuted.
Because the trusts are unable to adequately police themselves, Congress needs to act. That’s why I introduced the FACT Act, which would require asbestos trusts to provide quarterly reports on their claims to bankruptcy courts. By shining a light on the trusts, the FACT Act will discourage abusive claims and protect the money owed to future asbestos victims.
Opponents of the FACT Act, including plaintiffs’ lawyers who specialize in asbestos cases, argue that it will make it harder for asbestos victims to receive compensation from trust funds. Nothing could be further from the truth. Asbestos trust claims are filed electronically and trusts could easily and inexpensively produce the reports required by the FACT Act.
The bill’s opponents also claim that reporting will threaten asbestos victims’ privacy. This is absolutely false. Federal bankruptcy courts zealously guard asbestos victims’ personal information, and they will ensure that reports filed under the FACT Act are properly protected. The FACT Act also forbids any disclosure of confidential medical records.
Don’t our veterans and first responders deserve the same compensation as the asbestos victims who came before them? I believe they do. To make this possible, Congress must pass the FACT Act to keep asbestos trusts from running dry due to fraud and abuse.
Farenthold has represented Texas’ 27th Congressional District since 2011. He sits on the Judiciary; the Oversight and Government Reform; and the Transportation committees.