TN 12 (04-09)

SI 02260.010 Development of Without Fault for a Supplemental Security Income (SSI) Overpayment Waiver

A. Definition of without fault

“Without fault” is the absence of-fault-in connection with causing or accepting the overpayment.

B. Policy: without fault

1. General

We never base a without fault determination on isolated facts. We consider all the available evidence and information surrounding the case in the waiver file. For information on fault and without fault findings, see GN 02250.005.

The acceptance of payments made for due process purposes (e.g., payment continuation under Goldberg/Kelly) does not in itself establish that the individual knew or could have been expected to know that such payment(s) were incorrect.

NOTE: A determination that the overpaid individual is liable for repayment of the overpayment is not a finding that the liable individual is at fault in causing the overpayment. Policy and procedures for determining liability for repayment of an SSI overpayment are in SI 02201.020 through SI 02201.023 and SI 02201.025.

2. Factors to consider in finding without fault

Whether an individual is without fault depends on all the circumstances pertinent to the overpayment in a particular case. We consider whether the individual:

  1. Understood the cause of the overpayment at the time it occurred;

  2. Understood the reporting requirements;

  3. Agreed to report events affecting payments;

  4. Was aware of events that should have been reported;

  5. Attempted to comply with the reporting requirements;

  6. Had the ability and opportunity to comply with the reporting requirements; and

  7. Understood the obligation to return payments which were not due

3. Relationship of fault to the individual

The determination that an individual is without fault relates only to the individual seeking relief from adjustment or recovery of an overpayment. We do not attribute another individual’s fault or knowledge to the individual seeking relief.

EXAMPLE: A SSI Child is liable for repayment of an overpayment made to him or her. However, the child would be without fault in connection with an overpayment caused by the failure of the child's parent(s) or representative payee to report an increase in the parent(s) wages. See SI 02201.020 through SI 02201.023 for general instructions on determining liability.

4. Effect of administrative error

Administrative error will not relieve the individual of liability for repayment when he or she knew or should have known that the payment(s) was incorrect.

5. Situations which indicate fault

We consider the following situations as indicating the overpaid individual is at fault:

a. Willful misstatement or concealment of material facts or fraud

The overpaid individual is at fault in causing the overpayment if there is evidence of willful misrepresentation or concealment of material facts, or fraud, which directly or indirectly caused the overpayment.

Example: In August 2012, Harry Finch’s SSI payments were ceased on medical review. The cessation decision included evidence from a Cooperative Disability Investigation report. The report refuted many of the statements Mr. Finch made on the SSA-454 regarding his limitations. The report also provided evidence he omitted material information. On appeal, Mr. Finch requests benefit continuation. In August 2013, the benefit cessation is upheld, resulting in an overpayment. Mr. Finch’s inaccurate and misleading statements would preclude a finding of without fault in causing the overpayment.

b. Knowingly supplied incorrect information

The overpaid individual is at fault if he or she knowingly supplied information which he or she knew or should have known was incorrect.

However, if there is valid reason to believe the incorrect information supplied was given in good faith and that it was correct to the best of the individual’s knowledge, we may make a finding of without fault.

c. Duplicate checks

Receiving and negotiating two payments for the same month(s) indicates fault.

d. Conditional payments

Fault normally exists when the overpayment resulted from conditional payments (i.e., payments subject to disposition of excess resources). Such payments are made pursuant to a written agreement indicating full understanding of the consequences of disposition or failure to dispose.

For conditional payment overpayments, we will make a without fault finding only if the overpaid individual was not aware of the consequences of his or her actions.

e. Similar overpayments occurred in the past

Usually, we will find fault if the individual has incurred a similar overpayment in the past and at the time of the prior similar overpayment had reporting responsibilities explained to him or her. In this situation the individual should have had adequate knowledge of the effect of the change or event and of his or her obligation to report it.

6. Timely reporting and the presumption of without fault

  1. A change is reported timely if it is reported within 10 calendar days after the month the change occurred.

  2. Generally, we presume an individual to be without fault if he or she reported the pertinent change(s) timely.

  3. The presumption of without fault due to timely reporting applies only to those payments that were made in the month the change occurred and the following month.

  4. However, if incorrect payments continue for months after the month of a timely report, we may establish fault if the overpaid individual accepted payments he or she knew or should have known were incorrect.

  5. Similar overpayments in the past may preclude a presumption of without fault even if the individual reported the current change timely.

  6. If the overpaid individual willfully concealed or misstated material facts, we must rebut the presumption of without fault.

7. Goldberg/Kelly and statutory benefit continuation of payments

The overpaid individual exercising his or her right to payment continuation while we process an appeal and/or waiver is not an indication of fault. Fault determinations are based on the totality of the facts, argument and data in each individual case.

C. Procedures for processing SSI Overpayment waivers

1. General

You must consider the totality of the facts, argument and data in each individual case.

You must document the waiver file with all the evidence and information you receive either through MSSICS or by CEF/NDRed. See SI 02220.005 for policy and procedures on documenting SSI overpayments.

You can not use the individual’s acceptance of payments made for due process purposes (e.g., payment continuation under Goldberg/Kelly and statutory benefit continuation of payment) in order to establish that the individual knew or could have been expected to know that such payments were incorrect.

NOTE: You can not use a determination that the overpaid individual is liable for repayment of the overpayment to find that the liable individual is at fault in causing the overpayment. For liability determinations see SI 02201.020 through SI 02201.023 and SI 02201.025.

2. Factors to consider in finding without fault

Whether an individual is without fault depends on the totality of the facts, argument and data in each individual case. For each case you must consider whether the individual:

  1. Understood the cause of the overpayment at the time it occurred;

  2. Understood the reporting requirements;

  3. Agreed to report events affecting payments;

  4. Was aware of events that should have been reported;

  5. Attempted to comply with the reporting requirements;

  6. Had the ability and opportunity to comply with the reporting requirements; and,

  7. Understood his or her obligation to return payments which were not due

3. Relationship of fault to the individual

Without fault relates only to the situation of the individual seeking relief from adjustment or recovery of an overpayment. You can not charge the fault or knowledge of another person to the individual seeking relief.

4. Effect of administrative error

Administrative error does not relieve the individual of liability for repayment when he or she knew or should have known that the payment(s) was incorrect.

EXAMPLE: You can find fault if an individual continues to accept SSI payments which he or she had been told were incorrect, but which we could not prevent from being issued.

5. Situations which indicate fault

Consider the following situations as indicating the overpaid individual is at fault.

a. Evidence of willful misstatement or concealment

Whether there is evidence of willful misstatement, or concealment of material facts, or fraud, which directly or indirectly caused the overpayment. See SI 02201.005D and GN 04110.010.

b. Knowingly supplied incorrect information

The overpaid individual is at fault if he or she knowingly supplied information which he or she knew or should have known was incorrect.

EXAMPLE: If an overpaid individual established his or her age as 65 based on recent proof but knowingly withheld an earlier proof (e.g., a birth or baptismal certificate) which indicated he or she was actually less than 65, he or she is at fault in causing the overpayment.

However, if there is valid reason to believe the incorrect information supplied was given in good faith and that it was correct to the best of the individual’s knowledge, you can find the individual is without fault.

c. Duplicate checks

Receiving and negotiating two payments for the same period indicates fault. Processing instructions for waiver requests for duplicate check overpayments are in SI 02260.030C.

d. Conditional payments

Fault normally exists if the overpayment resulted from conditional payments (i.e., payments subject to disposition of excess resources). Such payments are made pursuant to a written agreement indicating full understanding of the consequences of disposition or failure to dispose.

You can find without fault only if the overpaid individual was not aware of the consequences of his or her actions. This should rarely be the case.

e. Similar overpayments incurred in the past

Usually, you can find fault if the individual has incurred a similar overpayment in the past and at that time had reporting responsibilities explained to him or her. Because reporting responsibilities were explained to the overpaid individual, there is a rebuttable presumption the individual had adequate knowledge of the effect of the change or event and of his or her obligation to report the change.

6. Timely reporting and the presumption of without fault

  1. A change is reported timely if it is reported within 10 calendar days after the month the change occurred.

    Generally, you can presume an individual to be without fault if he or she reported the pertinent change(s) timely.

  2. The presumption of without fault due to timely reporting applies only to those payments that were made in the month of change and the following month.

    However, if incorrect payments continue for the month(s) after the month of a timely report, you can establish fault if the individual accepted payments he or she knew or should have known were incorrect.

    EXAMPLE: A timely report is made. You inform the individual that payments are not due for future months and if