Identification Number:
EM-18010
Intended Audience:All RCs/ARCs/OCO/PSCs
Originating Office:DCO OPSOS
Title:Handling Returned or Bounced Remittance Checks and Remittance Check Adjustments Referred by the Federal Reserve Bank – One-Time Only Instructions
Type:EM - Emergency Messages
Program:Title II (RSI); Title XVI (SSI); Disability
Link To Reference:See References at the end of the EM.
 
Retention Date: October 2, 2018

A. Purpose

This emergency message (EM) provides interim guidance to Processing Center (PC) technicians for handling returned remittance checks (bounced checks) and remittance check adjustments referred by the Federal Reserve Bank (FRB) resulting from the Social Security Electronic Remittance System (SERS) transactions.

B. Background on Bounced Checks and Check Adjustment requests resulting from SERS transactions

In 2017, SSA implemented SERS for certain programmatic debts for Title 2 and Title 16. SERS is an automated payment solution that allows field office (FO) technicians to use card readers and check scanners to electronically process domestic remittances paid by check, money order, and debit or credit card (Visa, MasterCard, and Discover). SSA implemented SERS for programmatic collections nationally in December 2017.

When SERS processes a check or money order remittance, the system creates a deposit file for the Department of the Treasury (Treasury). However, if there are insufficient funds, the account is closed, or the check amount does not match the file deposit information, FRB returns these payments to SSA for correction.

FRB defines these returned payments as:
        · Returned (bounced) check: No funds are available or the account was closed

        · ·Check adjustment: The amount keyed into the SERS application is different from the actual check amount

Treasury posts returned (bounced) checks and check adjustments in their Collection Information Repository (CIR) application. This creates a debit or credit to SSA’s account and is captured by the Office of Benefit Accounting and Systems Analysis’ (OBASA) accounting application. Using the information from CIR, OBASA searches their internal and external applications to identify the original SERS transaction that requires adjustment and identifies the SERS order number. Using the SERS order number, OBASA finds the original deposit that corresponds to the receipt number in the Remittance File Query (RFQ) in PCOM, and uses that information to account for the debit or credit in the appropriate trust fund. OBASA faxes an SSA-559 to the Processing Center (PC) of jurisdiction’s Paperless queue to provide instructions to remove, increase, or decrease the remittance from the record, accordingly.

C. PC instructions for handling remittance returned (bounced) checks and remittance check adjustments

    1. Remittance returned (bounced) checks:

      Paperless Actionable Controlling Record (ACR) TOELs are OPMT/REMIT/SERS/RET

      a. If the remittance is a Title 16 returned check, the Debt Management Staff (DMS) will:
          · Use the SSA-3969 SSI Remittance Register to post the bounced check indicator to the SSR record. The remittance remains on the record, but the overpayment balance is increased by the amount of the bounced check (see OS 00515.020).
          · Input DMS remarks to show which remittance(s) was/were returned (see MS DMS 009.003).
        Note: PSCs 1-6 will handle Title 16 cases.


        b. If the remittance is a Title 2 returned check, the Benefit Authorizer (BA) will:

        NOTE: PCs 1-7 will handle Title 2 cases.

        IMPORTANT: You do not need to notify the debtor of the adjusted overpayment balance.



      Example 1: Jackie Doe came into her local FO and gave the SSA employee a $200.00 check to repay her Title 16 debt. The FO employee processed the remittance in SERS, and SSA credited the funds and posted the remittance on the SSR. However, when the check went to the actual bank, the account did not have sufficient funds. Treasury will post the check as ‘bounced’, which requires a record update (SSA-559) to annotate the remittance posted to the record as a returned, bounced check and reestablish the debt. The DMS technician should use the SSA-3969 SSI Remittance Register to post the bounced check indicator to the SSR, and input DMS remarks stating Treasury returned the remittance due to insufficient funds.

      Example 2: Jane Doe came into her local FO and gave the SSA employee a $100.00 check to repay her Title 2 debt. The FO employee processed the remittance in SERS, and SSA credited the funds and posted the remittance on the ROAR record. However, when the check went to the bank, the account was closed. Treasury will post the check as ‘bounced’, which requires a record update (SSA-559) to annotate the remittance posted to the record as a returned check and reestablish the debt. The BA technician should increase the overpayment or add a new debt via DMS or MACADE, and input DMS remarks stating the Treasury returned the remittance due to the account being closed.
    2. Remittance check adjustments:
      Paperless ACR TOELs are OPMT/REMIT/SERS/ADJ
    a. If the remittance is a Title 16 returned check adjustment, the DMS will: NOTE: PSCs 1-6 will handle Title 16 cases.

    b. If the remittance is a Title 2 returned check adjustment, the Benefit Authorizer (BA) will:

      NOTE: PCs 1-7 will handle Title 2 cases.

      IMPORTANT: You do not need to notify the debtor of the adjusted overpayment balance.


      Example 1: John Doe came into his local FO and gave the SSA employee a $100.00 check to repay his Title 2 debt. The FO employee mistakenly input the remittance in SERS for $1,000.00. SSA credited the funds and posted the remittance on the ROAR record in the amount of $1,000.00. However, the bank detected the error, which will notify Treasury to send a debit voucher to SSA’s account for $900.00. This shows up as a $900.00 check adjustment or debit which requires a record update (SSA-559) to decrease the remittance posted to the record. The BA technician should increase the overpayment or add a new debt via DMS or MACADE in the amount of $900.00, and input DMS remarks stating the Treasury sent a check adjustment debit due to input error.


      Example 2: Jack Doe came into his local FO and gave the SSA employee a $100.00 check to repay his Title 2 debt. The FO employee mistakenly input the remittance in SERS for $10.00. SSA credited the funds and posted the remittance on the ROAR record in the amount of $10.00. However, when the check went to the actual bank, the error was detected, which will notify Treasury to send a credit to SSA’s account for $90.00. This shows up as a $90.00 check adjustment or credit, which requires a record update (SSA-559) to increase the remittance posted to the record. The BA technician should decrease the overpayment via DMS or MACADE in the amount of $90.00, and input DMS remarks stating the Treasury sent a check adjustment credit due to input error.


Direct all program–related and technical questions to your PSC Operations Analysis (OA) staff. PSC OA staff may refer questions, concerns, or problems to their Central Office contacts.

References:
MS DMS 002.005 Modify Debt Statistics (SMMD)
MS DMS 002.011 Transaction Correction (SMTC)
MS DMS 009.003 Remarks (RMKS)
OS 00515.020 How to Complete an SSA-3969-U2, SSI Remittance Register
SM 00865.040 Coding the Bene Over/Underpayment Data (DP) Screen
EM-18010 - Handling Returned or Bounced Remittance Checks and Remittance Check Adjustments Referred by the Federal Reserve Bank – One-Time Only Instructions - 04/02/2018