Effective May 15, 2000, the Department of the Treasury (DT), in cooperation with the Richmond Federal Reserve Bank (RFRB) in Richmond, Virginia, implemented the CORE process for deceased payee reclamations.

CORE

• •

  reduces payment over cancellations for checks cashed after death of the beneficiary or recipient or representative payee.

• •

  eliminates the need for reclamation of checks cashed after death of a beneficiary or recipient.

The CORE process acts as a true stop-payment and enables the RFRB to deny payment to a financial institution (FI) that cashes a check after the death of the beneficiary, recipient, or representative payee. Prior to the implementation of CORE, if the check was cashed, it caused a payment over cancellation and was recovered by reclamation (see Payment Over Cancellation (POC)/Credit Reversal GN 02406.245).

The Bureau of the Fiscal Service (Fiscal Service) sends a daily file containing death information to the RFRB when we advise (Fiscal Service) that the payee is deceased (through the death input and subsequent E-stops generated, see GN 02408.010) and is not due any payments issued after death.

The information is matched against checks sent to the RFRB for payment.

When there is a match, the check is stamped, "Not Negotiable, Payee Deceased/Not Entitled, Questions—Contact Authorizing Agency."

DT cancels the check and returns it to the FI unpaid.

DT then returns a credit for the amount of the check to SSA.

FI receives instructions to give the non-negotiable check back to the individual who cashed it and resolve any problems resulted from the transaction with that individual. The matter is now between the FI and the person who cashed the check not SSA.

FI may take additional steps to recover the funds, such as debiting the person’s account.

EXCEPTION: If a check issued after the death of a beneficiary or recipient is cashed before SSA is aware of the death (late notification of death), the CORE process cannot prevent these checks from being paid.

NOTE: When an E-stop is generated and the payment after death is not cashed, SSA will receive a credit from Treasury. If a returned check for a payment issued after death is received and benefits are suspended, the returned-check amount will be placed on the Special Payment Amount (SPA) line of the Master Beneficiary Record (MBR). Treasury will no longer accept a check issued after death from the FI, and SSA would not receive a returned check from a Treasury credit.

If an erroneous death termination is input onto a Title II or XVI record, E-stops are placed on each check issued after the (erroneous) date of death (unless there is a representative payee, see GN 02408.005B.2. The CORE process flags those checks as non-negotiable and does not return payment for them. Therefore, processing centers (PCs) and field offices (FOs) must take corrective action to reinstate the terminated record and to prevent the release of underpayments.

When an erroneous death is transmitted, the following occurs:

• •

  Title II and Title XVI record is terminated based on the death data transmitted;

• •

  Beneficiary, recipient, or representative payee presents the check to the bank and receives payment;

• •

  CORE handles the E-stop as if the death actually occurred;

• •

  FI presents the check to the RFRB and is denied payment based on the death data transmitted through CORE;

• •

  CORE process denies payment to the presenting bank although the beneficiary, recipient, or representative payee received payment; and

• •

  DT returns credit to SSA

When SSA learns of the erroneous death and takes action to resurrect the terminated record, an underpayment is generated to the reinstated record. The SSA system detects a credit for the month of termination. Because the FI should be reimbursed, do not release the underpayment to the beneficiary, recipient, or representative payee who has already received the payment.

• •

  GN 02408.010 Automated E-Stop Process for Check/EFT Payments

• •

  GN 02602.055 Erroneous Death Termination

• •

  GN 02602.055 If an Individual Deceased on SSA Records is Alive

• •

  GN 02602.054 Erroneous Suspensions-Unverified Returned Payments for Death – Title II

• •

  SM 01301.376 Automated Death Processing

• •

  SM 00706.075 Correction of Date of Death on Master Beneficiary Record (MBR)

• •

  SM 00810.200 Restoring a Terminated Beneficiary to Entitled Status

• •

  SM 01301.378 Systems Processing of Subsequent Reports of Death