Effective Dates: 9/30/2024 - Present

Identification Number:	GN 03970 TN 21
Intended Audience:	See Transmittal Sheet
Originating Office:	OARO OAO
Title:	Suspension or Disqualification of Representatives
Type:	POMS Full Transmittals
Program:	All Programs
Link To Reference:

PROGRAM OPERATIONS MANUAL SYSTEM

Part GN – General

Chapter 039 – Representation and Representative's Fee

Subchapter 70 – Suspension or Disqualification of Representatives

Transmittal No. 21, 09/30/2024

Audience

PSC: CA, CS, ICDS, IES, ILPDS, IPDS, ISRA, RECONR, SCPS, TSA, TST;

OCO-OEIO: BIES, CR, PETL, RECONR, RECOVR;

OCO-ODO: BTE, CR, CST, CTE, CTE TE, PETE, PETL, RCOVTA, RECOVR;

ODD-DDS: DHU;

FO/TSC: CS, CS TII, CS TXVI, CSR, CTE, FR, OA, OS, RR, TA, TSC-CSR;

Originating Component

OAO

Effective Date

09/30/2024

Background

On July 16, 2021, the United States Court of Appeals for the First Circuit issued a decision in Marasco & Nesselbush, LLP v. Collins, instructing the Social Security Administration (SSA) to find a reasonably reliable means for law firms or other entities to receive direct payment of the fees the agency authorizes to their salaried employees. On August 21, 2024, SSA published a Final Rule entitled Changes to the Administrative Rules for Claimant Representation and Provisions for Direct Payment to Entities (89 FR 67542). This Final Rule establishes a new agency framework for ensuring that law firms and other entities can receive direct payment of the fees SSA authorizes to individual representatives who have affiliated with the firm or other entity. The Final Rule also provides for implementation in two phases: Phase I becomes effective 30 days after publication of the Final Rule and Phase II 90 days after publication. These updates are in preparation for Phase I implementation.

We have updated several POMS sections for consistency with the framework announced in the Final Rule and updated regulations. As part of Phase I implementation, the revised regulations provide updated definitions, standardize the registration processes for individual representatives, and create the position of “point of contact” (POC), who is an individual selected by an entity when it registers to communicate with SSA in resolving fee-related matters. POCs must be registered as a representative with SSA and are considered “representatives” for purposes of the Rules of Conduct and Standards of Responsibility for Representatives. Although POCs may face sanctions proceedings for their conduct that violates these rules and standards, they are not financially responsible for the repayment of excess or otherwise erroneous fee payments made to the entity. An entity that retains an excess or otherwise erroneous fee in violation of SSA’s rules may be placed on Ineligible for Direct Payment Entities (IDPE) list. That process, however, is completely separate and distinct from the sanctions process described in these POMS sections, and any reference to the IDPE process is simply to direct readers to the appropriate policy in other POMS sections or redirect misrouted IDPE referrals. The changes to subchapter GN 03970 implement these regulatory changes and provide guidance that aligns with the changes.

In addition, we updated section GN 03970.010 to add processing instructions for documenting mandatory representative disclosures in the electronic claim(s) file (EDCS/eView). These instructions will assist SSA in its obligation to report to the Office of Management and Budget (OMB) the number of required disclosures it receives not made using OMB forms (e.g., Form SSA-1696).

Summary of Changes

GN 03970.020 Evaluation and Action on Field Office (FO) and Processing Center (PC) Referrals

In subsection B, we included instructions for CPS or OSB staff to return an incorrectly forwarded IDPE referral to the sender. We also updated language throughout to ensure consistency with post-Marasco regulatory changes.

GN 03970.013 Definitions and Examples of Violations of the Rules of Conduct and Standards of Responsibility for Representatives

We changed the section title for clarity. In subsection A, we added a note and other clarifying language to explain how SSA may hold an individual POC and/or an entity responsible for violating SSA’s rules. In subsections B and D, we added examples to illustrate fee violations involving a POC and entity. We also updated language throughout to enhance clarity, improve accuracy, and ensure consistency with post-Marasco regulatory changes. We also made minor changes throughout to remove gendered language.

GN 03970.060 Field Office and Regional Office Action When an Attorney or Non-Attorney Representative is Suspended or Disqualified

In subsection A.1, we added language explaining that a sanctioned individual may not serve as an entity POC and that the entity may become ineligible for direct payment as a result, possibly invalidating existing assignments. In subsection A.2, we added language to clarify that an entity may not collect a fee for services performed by an affiliated representative after the date of their disqualification or suspension and may not receive direct payment of any fee assigned by a sanctioned individual.

In subsection B, we clarified that a representative may continue to be employed by, and assign fees to, an entity with which a sanctioned individual also affiliates, but any attempt to transfer part or all of a fee to that individual violates SSA’s rules on fee payments.

In subsection D, we updated notification instructions to reflect the current, largely automate process in the Registration, Appointment and Services (RASR) application. We also added D.4, which explains that SSA must immediately notify an entity when it’s POC's sanction becomes final and, as a result, the entity becomes ineligible for direct fee payment.

We updated language throughout to enhance clarity, improve accuracy, and ensure consistency with post-Marasco regulatory changes. We also made minor changes throughout to remove gendered language.

GN 03970.017 Referrals of Possible Fee and Non-Fee Violations

We changed the section title for clarity. In subsection A, we added references to the specific processing instructions for Disability Determination Services (DDS), Office of Hearings Operations (OHO), and Office of Appellate Operations (OAO) staff to follow in developing and referring suspected violations to OGC. We also updated Note 1 to address excess fee payments made to an entity, distinguish such excess fee payments from fee violations, explain when SSA may pursue sanctions against a POC, and redirect readers to the appropriate POMS section for the IDPE list.

In subsections B, C, D, E, and F we updated development and reporting instructions to account for the electronic processing of referrals as well as the conduct of POCs or others at an entity that may be involved in suspected fee and non-fee violations. We updated language throughout to enhance clarity, improve accuracy, and ensure consistency with post-Marasco regulatory changes. We also made minor changes throughout to remove gendered language.

GN 03970.065 Field Office’s Sample Notices of Suspension or Disqualification

We added subsection E to provide a sample notice that staff can send to an entity to notify it that the entity’s POC has been sanctioned and, as a result, the entity has become ineligible for direct payment of fees. The sample notice also explains that the entity will remain ineligible for direct payment, and that SSA will not be able to accept new assignments or honor existing ones, until the entity properly names a new POC by updating its registration. We also updated language throughout to enhance clarity, improve accuracy, remove gendered language, and ensure consistency with post-Marasco regulatory changes.

GN 03970.010 Rules of Conduct and Standards of Responsibility for Representatives

In subsection A, we added an explanation about when the rules and standards apply and to whom.

In subsection B.5, we added two notes. The first note includes processing instructions for staff at all levels of case adjudication to ensure that mandatory representative disclosures for certain medical or vocation opinions are properly filed in the electronic claim(s) file (EDCS/eView). The second note clarifies that representatives must submit a separate disclosure for each opinion that meets the requirements outlined in that subsection.

In subsection C, we added C.15, which describes the prohibited actions for an individual serving as a POC. In subsection D, we clarified that a POC may be referred to the Office of the General Counsel (OGC) for sanctions like other representatives. We also introduced the referral process for entities to the IDPE list. While a POC may be referred for actions taken on behalf of an entity, such as refusing or otherwise acting in bad faith in assisting us to resolve a fee matter, they are not financially responsible for the repayment of any excess or otherwise erroneous fees paid to the entity. We also clarified that the referral process for entities to the IDPE list is distinct from the sanctions referral process.

We also made minor editorial changes throughout to enhance readability, remove gender-specific language, and update hyperlinks as needed.

GN 03970.011 Potentially Unqualified Attorney and Non-Attorney Representatives

We updated language throughout to enhance clarity, improve accuracy, and ensure consistency with post-Marasco regulatory changes. We also made minor changes throughout to remove gendered language.

GN 03970.030 Action to Suspend, Disqualify, or Withdraw Charges Against a Representative by the Office of the General Counsel (OGC)

In subsection A, we added language to clarify that a POC may be referred to OGC as a “representative,” and, in addition to facing suspension or disqualification, may be unable to serve as a POC as a result. In subsection B, we added a paragraph explaining the additional language that OGC will include in the cover letter to the notice of charges and proposed sanctions OGC will send to an entity POC. In subsection G, we added language and an example to clarify that front-line staff should not inform a representative that a matter is closed when they are referring the underlying suspected misconduct to OGC for possible sanctions. We also updated language throughout to enhance clarity, improve accuracy, and ensure consistency with post-Marasco regulatory changes.

GN 03970.025 Field Office (FO) and Processing Center (PC) Action on Direct Payment Errors and Possible Fee Violations

We changed the section title for clarity. In subsection A, we added a note clarifying that excess fee payments to an entity cannot become fee violations and refer readers instead to the appropriate POMS section for the IDPE list. In subsections B and D, we added and clarified instructions for developing and referring direct payment errors and possible fee violations. In subsection C, we updated processing instructions to clarify that the sample notices may be prepared using Document Processing System (DPS) or Manage Text (AURORA) and that such notices do not require signature from an FO or PC manager. We updated language throughout to enhance clarity, improve accuracy, and ensure consistency with post-Marasco regulatory changes. We also made minor changes throughout to remove gendered language.

GN 03970.015 How We Deal With Representatives’ Actions that Violate the Law or Regulations

We archived this section and incorporated the information formerly within it into revised GN 03970.010 and GN 03970.013.

GN 03970.010 Rules of Conduct and Standards of Responsibility for Representatives

A. Introduction to the Rules of Conduct and Standards of Responsibility for Representatives

To ensure that claimants receive competent services from their representatives and to protect the integrity of our administrative process, we formulated the Rules of Conduct and Standards of Responsibility for Representatives ("rules and standards") (20 CFR 404.1740 and 416.1540 ). These rules and standards establish affirmative duties and prohibited actions for representatives. If a representative violates these rules and standards, we may suspend or disqualify that representative from practicing before us.

The rules and standards are applicable at all levels of the administrative decision-making process, and apply to all representatives regardless of whether they are currently appointed on a case, including those who serve as an entity’s point of contact (POC), as applicable to that role. For additional information about the role and responsibilities of a POC, see GN 03920.021.

B. Affirmative duties for a representative

A representative must:

1.
Submit all known evidence timely and in its entirety.

A representative must act with reasonable promptness to help obtain and submit, as soon as practicable, the information or evidence that the claimant must submit under our regulations. See DI 22501.002 for information on responsibilities for case development.
- •
  A claimant must inform us about or submit all known evidence that relates to whether or not the claimant is blind or disabled, as required in 20 CFR 404.1512 and 20 CFR 416.912 . A representative must assist the claimant in meeting this responsibility.
- •
  At the administrative hearing level, a representative must help the claimant inform us about or submit any written evidence no later than five business days before the date of the scheduled hearing. If the claimant and representative do not satisfy this requirement, the administrative law judge may decline to consider or obtain the evidence unless the circumstances described in 20 CFR 404.935(b) or 416.1435(b) (see Hearings, Appeals, and Litigation Law (HALLEX) manual I-2-5-13).
- •
  Although a claimant must inform us about or submit any written evidence no later than five business days before the date of the scheduled hearing to be considered timely, a representative should not wait until five days before the date of the scheduled hearing to submit evidence that was available to submit at an earlier date, see Social Security Ruling 17-4p.
- •
  When a representative, on behalf of the claimant, submits evidence received from another source, they must submit that evidence in its entirety, unless they previously submitted the same evidence to us or we instruct the representative otherwise. For definitions of nonessential evidence and duplicate evidence, refer to DI 20503.001 and DI 20503.003.
NOTE 1:

For more information on our policy and the claimant's and representative's responsibilities to obtain and submit evidence, refer to DI 22505.000 for Development of Medical Evidence of Record (MER) and DI 22501.002 for Responsibilities for Case Development of Disability Claims. Representatives may submit evidence through our Electronic Records Express (ERE) portal. At the hearing or Appeals Council levels, representatives requesting direct fee payment, must submit evidence electronically (see HALLEX I-5-1-23 and GN 03970.010B.4).

NOTE 2:

Privileged communications between a claimant and a representative are not evidence, and the claimant and representative do not need to submit privileged communications to us. We consider the following to be privileged communications and apply these guidelines equally to attorney and non-attorney representatives:
- •
  "Attorney-Client Privilege." The attorney-client privilege generally protects confidential oral or written communications between the claimant and their representative related to providing or obtaining advice about the claimant's claim(s), unless the claimant waives the privilege and voluntarily discloses the communication to us .
- •
  "Attorney Work Product." The attorney work product doctrine generally protects a representative’s analyses, theories, mental impressions, and notes about the claim(s).
However, neither the attorney-client privilege nor the attorney work product doctrine allows the claimant or the representative to withhold factual information, medical opinions, or medical and nonmedical evidence that we may consider in determining whether a claimant is entitled to benefits (see 20 CFR 404.1513(b) and 416.913(b) ; see also DI 24503.001).
2.
Comply with our requests for information or evidence.

A representative must assist the claimant in complying, as soon as practicable, with our requests for information or evidence. In disability and blindness claims, a representative must help the claimant acquire and provide, or authorize us to obtain, evidence about the claimant's:
- •
  Medical source(s);
- •
  Age;
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  Education and training;
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  Work experience;
- •
  Daily activities both before and after the alleged onset date;
- •
  Efforts to work; and
- •
  Any other factors showing how the claimant's impairment(s) affects their ability to work.
NOTE:

A representative's action or inaction need not be intentional to violate these two affirmative duties. However, when deciding whether to refer a representative's conduct to the Office of the General Counsel (OGC) under GN 03970.017, consider whether:
- •
  The representative’s non-submission of required evidence is part of a pattern of conduct;
- •
  The representative provides a reasonable explanation for not submitting the required evidence (e.g., a good-faith belief that it was unrelated to the pending claim); or
- •
  The circumstances suggest that the representative intentionally concealed, deleted, or altered evidence.
We will refer all representatives to OGC who have repeatedly engaged in behavior that potentially violates these affirmative duties.
3.
Conduct their dealings in a manner that furthers the efficient, fair, and orderly conduct of the administrative decision-making process.

This affirmative duty includes, but is not limited to, the following duties:

a. Provide competent representation to a claimant.

This affirmative duty requires that a representative know the significant issue(s) in a claim, have reasonable and adequate familiarity with the evidence in the case, and have a working knowledge of the applicable provisions of the Social Security Act (Act), our regulations, the Social Security Rulings, and any other applicable provisions of the law.

b. Act with reasonable diligence and promptness.

This affirmative duty requires that a representative provide prompt and responsive answers to our requests for information pertinent to the processing of a claim or an appeal.

c. Provide information about availability for a hearing when we request it.

This affirmative duty requires that a representative, in the manner we specify, respond to our request for potential dates and times that the representative will be available for a hearing. We will inform the representative how many potential dates and times we require to coordinate the hearing schedule.

d. Withdraw representation in a non-disruptive manner.

This affirmative duty requires that a representative ensure that their withdrawal will not disrupt the processing or adjudication of a claim and will allow the claimant adequate time to find new representation, if desired. We will make determinations on whether a representative has withdrawn in a disruptive manner on a case-by-case basis. Although we will not prevent a representative from withdrawing, if we determine the representative has withdrawn in a disruptive manner, we may refer the representative to OGC to consider pursuing sanctions.

A representative should not withdraw after we set the time and place for the hearing except when extraordinary circumstances are present. Extraordinary circumstances include, but are not limited to, a medical emergency affecting the representative or an immediate relative, a natural disaster, or the loss of a family member.

If another representative replaces the representative who is seeking to withdraw and there is no detrimental impact on the hearing process (e.g., delay of the hearing), we will not consider the withdrawal to be disruptive.

e. Maintain prompt and timely communication with the claimant.

This affirmative duty requires that a representative, among other things, keep the claimant reasonably informed of all matters concerning representation, consult with the claimant on an ongoing basis, and promptly respond to the claimant’s reasonable requests for information. When making determinations about this affirmative duty, we will consider the difficulty the representative may have in locating the claimant (e.g., because the claimant is homeless) and the representative’s efforts to fulfill this duty.

NOTE:

This affirmative duty also requires that any representative, who wishes to charge and collect a fee for representational services, has a reasonable understanding of our fee authorization processes and informs the claimant about the amount of the fee that they intend to charge. If a representative intends to seek a fee using the fee agreement process, and the terms of the fee agreement allow for a fee up to the maximum fee set by the Commissioner (i.e., the current fee cap), the representative must inform the claimant of the current maximum dollar amount and that this amount may increase before a fee, if any, is authorized in their case. If a representative intends to request a fee using the fee petition process, the representative must provide a copy of the fee petition document to the claimant begore submitting it to us.
4.
Conduct business with us electronically at the times and in the manner we prescribe on matters for which the representative requests direct fee payment, as required by 20 CFR 404.1713 and 416.1513 .

We require a representative to file certain appeals through our Disability Appeal (iAppeals) portal in matters for which the representative requests direct fee payment (see 77 FR 4653 and 77 FR 13968 , ). If a representative does not file the appeal electronically as required, we will still accept and process the paper appeal (e.g., SSA-561, HA-501, HA-520 or SSA-3441). However, we may refer the representative to OGC if they continually fails to comply with this affirmative duty and repeatedly submits paper appeals while requesting direct fee payment.

For claims pending at the hearing and Appeals Council levels with a certified electronic claim file, we also require a representative to access and obtain a claim(s) file through the Appointed Representative Services (ARS) system in matters for which the representative requests direct fee payment. Except in the limited circumstances described below, we will not provide a compact disc (CD) copy of the electronic claim(s) file to an appointed representative who requests direct payment of fees ( see 81 FR 22697 , and HALLEX I-5-1-22).

NOTE 1:

The mandate to use ARS does not change a representative's right to review the information in the claim(s) file or their right to request a fee for their services. The mandate does not require a representative to use direct deposit. It also does not affect a claimant's right to request a CD copy of their own claim(s) file.

NOTE 2:

When a claimant has appointed multiple representatives, only the principal representative is subject to the mandate to use ARS if they are requesting direct payment. However, when the principal representative is required to use ARS, we will not provide a CD copy of the electronic claim(s) file to other appointed representatives who are affiliated with same entity as the principal representative.

A representative is not required to use ARS if:
- •
  The case is pending at the initial or reconsideration levels;
- •
  The representative is a non-principal representative who is not affiliated with the same EIN as the principal representative;
- •
  The representative is not seeking direct payment of fees;
- •
  The representative cannot register for ARS due to technological issues outside their control (e.g., there is no cell phone coverage available to receive text messages in the area where the representative's office is located); or
- •
  Our systems or other technological limitations preclude the representative's online access to the electronic claim(s) file.
NOTE 3:

Representatives may use ARS to access and obtain a claim(s) file at the initial and reconsideration levels, but, as noted above, it is not a requirement at those levels.
5.
Disclose required information about submitted medical or vocational opinions.

This affirmative duty requires a representative to disclose the following information to us in writing at the time they submit a medical or vocational opinion to us or as soon as the representative is aware of the submission that:
- •
  The representative's employee or any individual contracting with the representative drafted, prepared, or issued the medical or vocational opinion; or
- •
  The representative referred or suggested that the claimant seek an examination from, treatment by, or the assistance of, the individual providing the opinion evidence.
  
  NOTE 1:
  
  The agency must report to the Office of Management and Budget (OMB) the number of disclosures received pursuant to 20 CFR 404.1740(b)(5)-(9) and 416.1540(b)(5)-(9) and outlined here in GN 03970.010B.5-9. To assist with disclosure reporting requirements, staff at all levels of case adjudication should ensure that any disclosures described in this subsection (GN 03970.010B.5) are filed into the electronic claim(s) file (EDCS/eView) using the document type “Required Disclosure – Medical (3076)” or “Required Disclosure – Vocational (1088),” depending on the type of evidence submitted with the disclosure, using appropriate processing procedures.
  
  NOTE 2:
  
  A representative must submit a separate disclosure each time they submit opinion evidence that meets the requirements in 20 CFR 404.1740(b)(5) and 416.1540(b)(5) and described in this subsection. A single disclosure for multiple opinions that meet those requirements is not sufficient.
  
  NOTE 3:
  
  "Contracting" means entering into an agreement with the representative to assist with representation or provide evidence or information pertinent to the claim.
6.
Disclose to us immediately if the representative discovers that their services are being used or were used by the claimant to commit fraud against us.

This affirmative duty applies to all representatives at all times, even if the claimant has not yet appointed the representative, and even if the representative's services on a claim have ended. The representative must notify us when the representative discovers that a claimant used or is using the representative's services to commit fraud against us (e.g., the representative learns that the claimant, knowing that the failure to disclose could affect their eligibility for benefits, intentionally failed to disclose earnings, assets, or a full work history to us).
7.
Disclose to us whether the representative is or has been disbarred or suspended from any bar or court to which they were previously admitted to practice.

This affirmative duty includes instances in which a bar or court took administrative action to disbar or suspend the representative in lieu of disciplinary proceedings (e.g., acceptance of voluntary resignation pending disciplinary action). If the disbarment or suspension occurs after the appointment of the representative, the representative must immediately disclose the disbarment or suspension to us.
8.
Disclose to us whether the representative is or has been disqualified from participating in or appearing before any Federal program or agency.

This affirmative duty includes instances in which a Federal program or agency took administrative action to disqualify the representative in lieu of disciplinary proceedings (e.g., acceptance of voluntary resignation pending disciplinary action). If the disqualification occurs after the appointment of the representative, the representative must immediately disclose the disqualification to us.
9.
Disclose to us whether the representative has been removed from practice or suspended by a professional licensing authority for reasons that reflect on the person's character, integrity, judgment, reliability, or fitness to serve as a fiduciary.

This affirmative duty requires a representative to notify us promptly when a professional licensing authority removes them from practice or suspends them for reasons indicated above. The representative must inform us in writing about their removal from practice or suspension (e.g., by submitting an updated registration Form SSA-1699 or providing us with a copy of the suspension or disbarment notice). If the removal or suspension occurs after the appointment of the representative, the representative must immediately disclose their removal or suspension to us, and we may disqualify this representative from appearing before us.
10.
Ensure that all of the representative's employees, assistants, partners, contractors, or any person assisting the representative on claims for which the representative has been appointed, comply with our rules of conduct and standards of responsibility for representatives, when the representative has managerial or supervisory authority over these individuals or otherwise has responsibility to oversee their work.

This affirmative duty requires a representative to take remedial action when:
- •
  The conduct of any of the representative's employees, assistants, partners, contractors, or other individuals who is assisting the representative with a claim has violated the rules of conduct and standards of responsibility; and
- •
  The representative has reason to believe a violation of the rules of conduct and standards of responsibility occurred or will occur.

C. Prohibited actions for representatives

A representative must not:

1.
In any manner or by any means threaten, coerce, intimidate, deceive, or knowingly mislead a claimant, or prospective claimant or beneficiary, regarding benefits or other rights under the Act. This prohibition includes misleading a claimant, or prospective claimant or beneficiary, about the representative’s services and qualifications.
2.
Knowingly charge, collect, or retain, or make any arrangement to charge, collect, or retain, from any source, directly or indirectly, any fee for representational services in violation of any applicable law or regulation. This prohibition includes soliciting any gift or any other item of value, other than what is authorized by law.
3.
Make or present, or participate in the making or presentation of, false or misleading oral or written statements, evidence, assertions, or representations about a material fact or law concerning a matter within our jurisdiction, in matters where the representative knows or should have known that those statements, evidence, assertions, or representations are false or misleading.
4.
Through their own actions or omissions, unreasonably delay or cause to be delayed, without good cause (see 20 CFR 404.911(b) and 416.1411(b)), the processing of a claim at any stage of the administrative decision-making process. Unreasonable delay is delay that is not justifiable, or delay that is preventable with reasonable care.
5.
Divulge, without the claimant's consent, except as may be authorized by our regulations or as otherwise provided by Federal law, any information we furnish or disclose about a claim or prospective claim.
6.
Attempt to influence, directly or indirectly, the outcome of a decision, determination, or other administrative action by any means prohibited by law, or by offering or granting a loan, gift, entertainment, or anything of value to a presiding official, agency or Disability Determination Services (DDS) employee, or witness who is or may reasonably be expected to be involved in the administrative decision-making process, except as reimbursement for legitimately incurred expenses or lawful compensation for the services of an expert witness retained on a non-contingency basis to provide evidence.
7.
Engage in actions or behavior prejudicial to the fair and orderly conduct of administrative proceedings, including but not limited to:
- •
  Repeated absences from, or persistent tardiness at, scheduled proceedings without good cause (see 20 CFR 404.911(b) and 416.1411(b)); or
- •
  Behavior that has the effect of improperly disrupting proceedings or obstructing the adjudicative process, including but not limited to:
  
  –
  Directing threatening or intimidating language, gestures, or actions at a presiding official, witness, contractor, or agency employee;
  
  –
  Providing misleading information or misrepresenting facts that affect how we process a claim, including, but not limited to, information relating to the claimant's work activity or the claimant's residence or mailing address in matters where the representative knows or should have known that the information was misleading and the facts would constitute a misrepresentation; and
  
  –
  Communicating with agency staff or adjudicators outside the normal course of business or other prescribed procedures in an attempt to influence the proceedings or outcome of a claim.
8.
Violate any section of the Act for which a criminal or civil monetary penalty is prescribed.
9.
Refuse to comply with any of our rules or regulations.
10.
Suggest, assist, or direct another person to violate our rules or regulations.
11.
Advise any claimant or beneficiary not to comply with any of our rules or regulations.
12.
Knowingly assist a person whom we suspended or disqualified to provide representational services in a proceeding under the Act, or to exercise the authority of a representative as described in 20 CFR 404.1710 and 416.1510.
13.
Fail to comply with our sanction(s) decision.
14.
Fail to oversee the representative’s employees, assistants, partners, contractors, or any other person assisting the representative on claims for which the representative has been appointed, when the representative has managerial or supervisory authority over these individuals, or otherwise has responsibility to oversee their work.
15.
While serving as a POC for an entity, violate applicable affirmative duties, engage in prohibited actions, or conduct dealings with us in a manner that is untruthful or does not further the efficient and prompt correction of a fee error.

NOTE:

In addition to suspension or disqualification from acting as an appointed representative before us, representatives, including POCs, who engage in conduct that violates any provision of the Act may also be subject to incarceration, fines, and civil monetary penalties.

D. Referrals and Initiating Sanctions Process

When we have evidence that a representative has violated the rules and standards, we may begin proceedings to suspend or disqualify that individual from acting in a representational capacity before us. If you suspect that a representative has violated any of the rules described above, refer the individual to OGC under the procedures for referrals of possible fee violations and non-fee violations, as described in GN 03970.017.

Although a POC need not be an attorney or non-attorney eligible for direct payment or appointed to any claim, matter, or other issue (e.g., a paralegal assistant or secretary), they are considered a “representative” for purposes of the Rules of Conduct and Standards of Responsibility (see 20 CFR 404.1703 and 416.1503 ). As such, a POC who violates any of the rules and standards, as applicable to their duties as a POC, may be referred for sanctions as described in GN 03970.017. If sanctioned, the individual will not be able to serve as a POC. For additional information about the roles and responsibilities of POCs, see GGN 03920.021C.

The Office of the General Counsel (OGC) has responsibility for pursuing administrative sanctions against representatives, including entity POCs, for violations of our rules and standards. Refer conduct that involves a possible violation of our rules to OGC using the instructions in GN 03970.017. See further information about OGC’s role in the sanctions process in GN 03970.030. Do not refer any possible violations involving attorneys to any State Bar.

NOTE 1:

The rules and standards and the sanctions process apply only to representatives, including POCs, in their individual capacity and not to entities. The agency does not sanction entities under the Rules of Conduct and Standards of Responsibility for Representatives.

NOTE 2:

If there is evidence that suggests a POC violated our rules and standards, they may be referred to OGC, even if their actions were taken on behalf of an entity as its POC. For example, a POC who does not make a good-faith effort to cooperate with us or actively refuses to assist in remitting an excess or otherwise erroneous fee paid to their entity may be considered to have committed a non-fee violation. See GN 03970.017D. and E. for non-fee violation processing instructions. In this example, we will not consider the POC to have committed a fee violation or hold the POC financially responsible for returning any excess or otherwise erroneous fee paid to an entity. For instructions concerning excess or erroneous fee payment made to an entity, see GN 03920.052. In addition, POCs who also provide representational services may be referred for sanctions for engaging in any suspected misconduct while representing a claimant. For definitions and examples of possible fee and non-fee violations, see GN 03970.013.

GN 03970.011 Potentially Unqualified Attorney and Non-Attorney Representatives

The Social Security Act (Act) requires certain qualifications for attorney and non-attorney representatives (see GN 03910.020A). If a representative does not meet these qualifications, we may (1) not recognize the appointment, or (2) take action to disqualify the representative based on the guidance in this section.

A. Procedure for handling pending claims, matters, or issues with a potentially unqualified attorney representative

If you suspect a prospective attorney representative does not meet the qualifications as stated in GN 03910.020A.1 for us to recognize them as a representative in the current case, take the following actions:

1.
Process the Form SSA-1696 "Claimant’s Appointment of a Representative,"
2.
Immediately refer the individual to the Office of the General Counsel (OGC) following the instructions in GN 03970.017 and using the contact information in GN 03970.070,
3.
Continue to recognize the attorney as the claimant's appointed representative unless and until we disqualify or suspend them in a final decision, and
4.
Continue to process the case without delay.

B. Procedure for handling pending claims, matters, or issues with a potentially unqualified non-attorney representative

If you suspect a prospective non-attorney representative does not meet the qualifications as stated in GN 03910.020A.2 for us to recognize them as a representative in the current case, take either of the following sets of actions:

1.
If, in another case, we have previously recognized the non-attorney as an appointed representative:
1. a.
  Process the Form SSA-1696 ,
2. b.
  Immediately refer the individual to OGC to determine appropriate action following the instructions in GN 03970.017 and using the contact information in GN 03970.070,
3. c.
  Continue to recognize the non-attorney representative as the claimant's appointed representative unless and until we disqualify or suspend them in a final decision, and
4. d.
  Continue to process the case without delay.
2.
If we have not previously recognized the non-attorney as an appointed representative:
1. a.
  Do NOT process the Form SSA-1696 ,
2. b.
  Immediately refer the individual to OGC following the instructions in GN 03970.017 and using the contact information in GN 03970.070,
3. c.
  Notify the claimant that they are not currently represented while we are evaluating the appointment,
4. d.
  Do NOT recognize the appointment until OGC provides guidance on our recognition of the non-attorney,
5. e.
  If OGC determines that the individual does not meet the qualifications to be a representative, use Document Processing System (DPS) or Manage Text (AURORA) and the appropriate sample language in GN 03970.065D to notify and return the SSA-1696 to the claimant, and
6. f.
  Continue to process the case without delay.

GN 03970.013 Definitions and Examples of Violations of the Rules of Conduct and Standards of Responsibility for Representatives

A. Definitions of violations

1. Fee violations

A fee violation occurs when a representative, including an entity's point of contact (POC), knowingly charges, collects, retains, or arranges to charge, collect, or retain, from any source any fee for representational services in violation of an applicable law or regulation (see GN 03970.010C.2). The representative's actions may be direct or indirect, and the unauthorized fee collection may be total or partial. For the procedures to develop and refer individual representatives and POCs for suspected fee violations, see GN 03970.017.

For instructions concerning excess or erroneous fee payments made to an entity, see GN 03920.052

NOTE:

When an entity wants to receive direct payment of authorized fees through assignment, the entity selects a POC to speak and act on the entity’s behalf in dealings with us (see 20 CFR 404.1703 and 416.1503). A POC’s role is to assist us in the resolution of fees or fee errors. Although a POC need not be appointed to any claim, matter, or other issue, they are considered a “representative” for purposes of the Rules of Conduct and Standards of Responsibility for Representatives. A sanctioned individual is not eligible to serve as a POC. The POC may be subject to suspension, disqualification, and in rare circumstances, criminal prosecution; however, they will not be held financially responsible for repayment of excess or otherwise erroneous fees paid to the entity. POCs will generally not be sanctioned if their entity does not remit excess or erroneous fees unless they act in a manner that clearly violates our Rules of Conduct and Standards of Responsibility for Representatives. For example, a POC who does not make a good-faith effort to timely cooperate with us or actively refuses to assist in remitting excess or erroneous fees could be considered to have committed a non-fee violation. The only time a POC may be referred for a suspected fee violation is when they collect and retain an excess, erroneous, or unauthorized fee for directly providing representational services to a claimant. For further information about assigning direct payment of fees, including the roles and responsibilities of POCs, refer to GN 03920.021.

NOTE 2: Some non-profit organizations have internal rules prohibiting individuals working on their behalf from requesting or receiving fees for their services. Because we recognize individuals and not organizations as representatives, we do not involve ourselves in the business processes of these organizations. It is not a violation of our fee rules for a representative, whom a non-profit organization employs, to seek our authorization for, or direct payment of, an authorized fee under either the fee agreement or fee petition process.

a. Total unauthorized fee collection

A total unauthorized fee collection occurs when a representative collects a fee directly from the claimant, any affected auxiliary beneficiary or eligible spouse, or another individual (whether related or unrelated to the claimant, any affected auxiliary beneficiary, or eligible spouse) without our prior authorization.

NOTE:

Payments to a representative by third-party entities are an exception to our general authorization requirement. For more information on fees that are not subject to our authorization, see 20 CFR 404.1720(e) and 416.1520(e), and GN 03920.010.

b. Partial unauthorized fee collection

A partial unauthorized fee collection occurs when we authorize a fee based on a fee agreement or fee petition, but a representative collects an amount in excess of the fee we authorized. The amount over the authorized fee is a partial unauthorized fee collection.

NOTE: If we pay a representative in error and the representative does not return the excess fee on receipt or after notification of the error, the direct payment error may result in an unauthorized fee collection. This unauthorized fee collection could be “partial” or “total.”

2. Non-fee violations

A non-fee violation occurs when a representative, including a POC, fails to comply with an affirmative duty or commits a prohibited action, as defined in GN 03970.010B and GN 03970.010C, that is not a fee violation.

For procedures for development and referrals of suspected non-fee violations, see GN 03970.017 and DI 31001.010.

3. Criminal violations

In addition to violating our rules and standards, there are some actions that may also violate provisions of the Social Security Act (Act) or other laws that provide criminal penalties for such violations.

NOTE: The Office of the Inspector General (OIG) has responsibility for investigating criminal violations. See information on violations of the Social Security Act and fraud in GN 04100.000. Regardless of whether OIG decides to seek criminal prosecution, the Office of the Chief Counsel (OGC) reviews all referrals for possible administrative sanctions. Therefore, refer conduct involving potential criminal violations to both OIG and OGC using the instructions in GN 03970.016.

B. Fee violations: Examples of possible violations of our rules on charging, collecting, or retaining representative fees

1. Collecting an excess fee

A representative petitioned for a fee of $1,950. We authorize a fee of $1,500. Through error, we directly paid the full $1,950 amount to the representative, even though we only authorized $1,500 for the representative's fee. Once we realized the error, we immediately sent a notice to the representative requesting refund of the excess amount, not including the user fee. If the representative does not return the excess amount after we notify them of it, the representative is knowingly retaining an amount in excess of the authorized fee in violation of our rules.

NOTE:

If the representative in this example validly assigned direct payment of their fee to an entity, and we erroneously paid the entity $1,950, we would send the notice requesting refund only to the entity’s POC. The assigning representative has not violated any of our rules in these circumstances. If the POC does not return the excess amount on behalf of the entity after notice, refer to the instructions in GN 03920.052D. We will not refer the POC simply for disputing an excess or otherwise erroneous fee on behalf of the entity. The POC, however, may have engaged in prohibited actions and conducted dealings with us in a manner that did not further the efficient and prompt correction of a fee error in violation of our rules, which would be a non-fee violation. Although we may refer the POC for possible sanctions for such a violation, we will not hold the POC financially responsible for the repayment of excess or otherwise erroneous fees paid directly to the entity.

2. Collecting a fee on behalf of a representative through a Power of Attorney (POA)

A representative submits a POA to receive a fee on behalf of a former partner. The representative also submits a fee petition for the former partner's work along with the POA. While we generally do not accept or process a POA or fee petition from anyone other than the appointed representative (i.e., the former partner), the representative has not violated our rules by requesting authorization from us to collect a fee on behalf of the former partner through a POA.

However, if the representative attempts to collect or actually collects the former partner's fee without our authorization, the representative may be in violation of our rules.

NOTE: In limited circumstances, we may accept a fee petition submitted by someone other than the representative. For more information on petitioning for a fee, including these limited circumstances, see GN 03930.020.

3. Collecting a fee without our authorization

A representative enters into an agreement with a claimant allowing the representative to charge a fee equal to 25 percent of the claimant's past-due benefits (PDBs) if we allow the claim, or nothing if we deny the claim. The representative tells the claimant that they want to avoid the "long delays" involved with our direct payment of her fee. The representative tells the claimant that if we award benefits, the claimant should bring the first check from us to the representative's office to pay the representative's fee. We approve the claim on reconsideration, which results in the reopening of a prior denied claim and an award of retroactive benefits. The representative does not submit a fee agreement or fee petition to us and assures the claimant that we "routinely authorize representative fees of 25 percent of retroactive benefits." The claimant pays the representative a fee consisting of 25 percent of the PDBs. The representative has engaged in prohibited conduct because the representative knowingly charged, collected, and retained a fee without our authorization.

4. Collecting a fee from an escrow account that exceeds the authorized amount

Claimants may willingly enter into an agreement to deposit money into a trust or escrow account before we authorize a fee, and the money must be held in the trust or escrow account and not withdrawn until after we authorize a fee. Any amount the representative collects from such an account must not exceed the amount we authorize. For more information on trust and escrow accounts, refer to GN 03920.025.

5. Failure to refund an unauthorized fee involving a duplicate fee payment by us

A representative receives a properly authorized direct payment of $1,800 from withheld PDBs for services representing a disability claimant before us. Inadvertently, we certify duplicate payment of the fee to the U.S. Treasury. The representative receives a second check for $1,800 and deposits it into their account. After the field office (FO) or payment center (PC) sends a notice to the representative notifying them of the duplicate fee payment and requests a refund, the representative does not act on the notice and does not refund the duplicate payment. The representative has engaged in prohibited conduct because they have knowingly retained a fee in excess of the amount we authorized.

NOTE: If the representative in this example had validly assigned direct payment of their fee to an entity and we paid the duplicate fee to that entity, the FO or PC would notify only the entity's POC of the duplicate fee following the instructions in GN 03920.052. If the entity’s POC conducted dealings with us in a manner that did not further the efficient and prompt correction of a fee error in violation of our rules, the POC may have committed a non-fee violation. However, we will not hold the POC financially responsible for repayment of any excess or otherwise erroneous fees paid directly to the entity. Furthermore, in this example, the assigning representative has not violated any of our rules. For instructions concerning excess or otherwise erroneous fee payments made to an entity, see GN 03920.052.

6. Charging and collecting an unauthorized fee based on a contract with a minimum fee

A representative enters into a signed fee contract with a claimant, stating that the "minimum" fee for their services is $1,000. The fee contract does not state that we must authorize this fee. After we approve the claim, the representative sends us a fee petition requesting $1,000 for their services. However, we only authorize a fee for $700, and the representative then seeks the additional $300 from the claimant, based on the fee contract. The representative has engaged in prohibited conduct because they charged a fee in excess of the amount we authorized, misled the claimant by asserting that there can be a minimum fee for representation, and failed to inform the claimant that we have to authorize any fee.

7. Indirect collection of a fee through third party payments and without our authorization

The claimant has a private insurance policy that pays them benefits when they are unable to work. The insurance company informs the claimant that the terms of the policy requires the claimant to file for Title II Disability Insurance Benefits (DIB). The insurance company assures the claimant that it will provide a representative to assist them at no charge.

Later, we award the claimant DIB benefits. The representative, who contracted with the insurance company to represent the claimant, informed us on the Form SSA-1696 that they waived their right to charge and collect a fee from the claimant, any affected auxiliary beneficiary, or any other source. Following the terms of the policy, the claimant notifies the insurance company about the award. The insurance company then pays the representative a fee for their representation of the claimant before us and deducts the same amount from the claimant's insurance policy benefits. If the representative knows the insurance company charged the claimant and the representative retains the fee, then the representative has engaged in prohibited conduct, because they knowingly violated our rules, which state that when a third party pays a representative's fee, the claimant and any affected auxiliary beneficiary must be free of liability directly or indirectly, as described in GN 03970.010C and GN 03920.020 (see also 20 CFR 404.1720(e) and 416.1520(e) ).

8. Arrangements to charge, collect, or retain a fee directly from a claimant's bank account

A non-attorney representative who is not eligible for direct payment, asks a claimant to agree to one of the following:

•
Allow the representative to sign checks or use a prepaid debit card against an account into which we directly deposit DIB or Supplemental Secuirty Income (SSI) payments;
•
Request that their DIB or SSI payments be directly deposited into an account that requires the representative to co-sign checks with the claimant before the claimant can withdraw funds from that account; or
•
Enter into an agreement that allows the representative to make electronic withdrawals from an account into which we directly deposit the claimant's DIB or SSI payments without the need to obtain the claimant's express permission for each withdrawal.

All three options violate our rules. Under our rules, the representative cannot have a financial interest in the bank account where we deposit the claimant's DIB or SSI payments. A representative must obtain authorization from a claimant to access a bank account after we pay DIB or SSI payments into the account and before each withdrawal. Here, the representative is collecting or arranging to collect the fee from directly deposited benefits or payments without obtaining the claimant's express permission after the funds are in their account.

If the representative collected a fee from the claimant without our prior authorization, then they have charged and collected an unauthorized fee and also violated our regulations under 20 CFR 404.1720, 404.1740(c)(2), 416.1520, and 416.1540(c)(2).

A representative who inappropriately gains control of the claimant's Social Security benefits may also be in violation of sections 207 and 1631(d)(1) of the Act, which prohibit the transfer or assignment of the right of any person to any future payments (benefits) under our titles. For more information about assignment of benefits and permission requirements, refer to GN 02410.001D.2.

C. Non-fee violations: Examples of possible violation scenarios related to other rules of conduct and standards of responsibility

Although the following examples do not cover every situation, they illustrate how a representative may violate their affirmative duties or may engage in prohibited conduct. In addition to these examples that involve individuals providing representational services, NOTE 1 in GN 03970.013A.1 (in this section) provides an example of a non-fee violation involving an entity’s POC.

1. Failure to provide competent representation

At the hearing, the representative is uninformed about a relevant issue, the applicable laws and regulations, and/or the facts of the case. The representative is also unprepared to ask questions or argue the issue, and cites irrelevant regulations and rules. Based on these facts, the representative has violated the affirmative duty to provide the claimant with competent representation.

2. Failure to file requests for appeals electronically

Representatives who are eligible for and request direct payment of their fees are required to file certain appeals electronically, using our iAppeals portal.

•
Example 1: A representative routinely submits paper appeal requests on medically denied initial claims and reconsideration claims, but requests direct payment of fees on all cases. The representative advised us that they do not like using the Disability Appeal (iAppeals) portal because they consider it unreliable and prefer filling out information on paper. Based on these facts, the representative has violated the affirmative duty to conduct business with us electronically by deliberately failing to file these appeals electronically.

•
Example 2: A representative always asks their clients to submit a paper request for reconsideration or a hearing before the represetnative submits the Form SSA-1696, indicating the representative intends to seek direct payment of their fee. By routinely asking the claimants to file these appeals in paper and then requesting direct payments, the representative is circumventing the affirmative duty to file certain appeals electronically and is violating our direct payment rules.

3. Failure to use the Appointed Representative Services (ARS) System

Representatives who are eligible for and request direct payment of fees are required to use the ARS system to access and obtain all information and evidence in claims with certified electronic folders pending at the hearing or Appeals Council levels unless one of the exceptions in GN 03970.010B.4. applies.

•
Example 1: A representative has 150 disability claims pending at the initial and reconsideration levels and requests CD copies of all the claim(s) files. Even if this representative requests direct payment on all of their cases, they are not in violation of our rules because the representative is not required to use the ARS system at the these levels. However, after receiving several initial and reconsideration denial determinations, the representative requests hearings for their clients and again requests CD copies of all the files instead of using the ARS system. Unless a limited exception applies (see GN 03970.010B.4, NOTE 2), the representative has now violated our mandate to use the ARS system to access the claim files.
•
Example 2: Five claimants have Social Security claims pending at the Appeals Council level and have appointed the same representative. Each claimant separately writes us to request CD copies of their claim(s) files. The claimants are not under the mandate to use ARS and we will provide them with the requested copies of their files. However, if claimants who are clients of a particular representative routinely request CD copies of their files, the representative may be in violation of our mandate to use the ARS system to access the claim(s) files when the circumstances suggest that the representative is directing this activity to circumvent the obligation to use the ARS system.

4. Failure to inform us about or submit required evidence

•
Example 1: A representative advises their client about the duty of a claimant to inform us about, or submit, all known evidence that relates to whether or not the claimant is blind or disabled. The claimant gives the representative a stack of medical records that includes copies of several test results. The following day, the representative uploads the documents to the claimant's electronic file, but removes a recent test containing normal findings, as they believe this evidence would unfavorably affect their client's disability claim. Based on these facts, the representative has violated our rules because they knowingly failed to submit all known evidence that pertains to whether the claimant is blind or disabled.

•
Example 2: A representative advises a client to not respond and complete the Form SSA-3368-BK (Disability Report - Adult) they received from us, stating that we oftentimes do not even look at that form. Based on these facts, the representative violated our rules because the representative suggested non-compliance with our request for information or evidence.

5. Delay proceedings without good cause

A representative is chronically late in submitting required reports because their office is short staffed. They also routinely submit late filings and requests for good cause based on short staffing. The representative's late submissions have delayed the case processing for a number of claimants. Based on these facts, the representative may have violated our rules by unreasonably delaying or causing to be delayed the processing of these claims because a lack of staffing is not good cause for missed deadlines under 20 CFR 404.911(b) and 416.1411(b).

6. Withdraw in a manner that disrupts the processing of the case

On the day before a scheduled hearing, a representative sends a letter to us and the claimant, stating that they are withdrawing as the claimant's representative in the case. In the letter, the representative provides no reason for the withdrawal. The next day, the claimant arrives for the hearing, but informs the administrative law judge (ALJ) that they do not feel comfortable continuing without a representative. The ALJ postpones the hearing to allow time for the claimant to obtain a new representative. Based on these facts, the representative may have violated our rules because the representative withdrew their appointment after the hearing was scheduled and failed to identify extraordinary circumstances for the withdrawal, which disrupted our processing of the claimant's case.

7. Failure to provide evidence as soon as practicable

Soon after appointing a representative, a claimant provides the representative with relevant medical and work history evidence that they need to submit to us. The representative has the evidence for six months but makes no effort to provide the evidence to us, finally providing it to an ALJ only two business days before the date of the claimant's hearing. Based on these facts, the representative has violated our rules because they failed to provide us the required evidence "as soon as practicable." Moreover, as the representative did not inform us about or submit this evidence at least five business days before the date of the scheduled hearing, the ALJ may decline to consider this evidence (see Social Security Ruling 17-4p ).

8. Misrepresentation of facts

•
Example 1: A disability applicant receives unreported cash payments for housecleaning work they routinely do for several families in their neighborhood. Their representative advises them not to report this work in their Social Security application because the work and earnings will negatively affect their claim for disability. Based on these facts, the representative has violated our rules because the representative participated in the making or presentation of false evidence about the claimant's work and earnings.

•
Example 2: The claimant owns a new automobile, which the claimant won at a contest and stores at an aunt's house in a different state. The claimant knows that the asset will count as a resource and decides not to mention it on their SSI application. Their representative agrees with the claimant that doing so is a good idea, and the claimant continues to conceal this asset. Based on these facts, the representative has violated our rules because the representative participated in the making or presentation of false or misleading statements about the claimant's resources.

9. Failure to properly disclose required information about opinion evidence

A representative referred a claimant to a doctor for a medical examination and medical source statement. A few days later, the doctor sends the report of the examination, including a completed form with a medical opinion, to the representative. The representative submits the medical report and opinion to us the following day, but does not disclose in writing that they referred the claimant to the doctor for an examination and opinion. Based on these facts, the representative has violated our rules by failing to inform us of the referral.

10. Failure to oversee individuals assisting on claims when the representative has managerial or supervisory authority over these individuals

A claimant's representative who is a partner at a law firm asks their paralegal to submit relevant medical evidence that the claimant needs to submit to us. The paralegal forgets and does not submit the evidence by the date of the administrative hearing. Instead, the paralegal submits this evidence a week following the hearing. As a result, the ALJ declines to consider the untimely submitted evidence. Based on these facts, the representative violated our rules because they did not ensure the individual assisting them complied with our rules and standards.

D. Examples of violations subject to criminal prosecution

The following examples provide a non-exhaustive sample of situations that may indicate that a representative has engaged in prohibited conduct. Some actions that violate the Rules of Conduct and Standards of Responsibility for Representatives may also violate laws that have criminal penalties.

1. Knowingly make or participate in making a false statement or representation

•
Example 1: A mother files for benefits on behalf of a two-year old child, alleging that a deceased Number Holder (NH) is the child's father. The mother is unable to establish the child's relationship to the NH or provide proof that the NH supported the child before their death, so we deny the claim at the initial level. The mother appoints a representative to appeal the unfavorable determination. The representative submits four affidavits from individuals alleging to have first-hand knowledge of the NH’s paternity. We award the child survivor’s benefits, but later learn that the individuals only had casual acquaintance with the NH, that they had no knowledge of the paternity issue, and that the representative persuaded them to sign the affidavits in return for $50 each. Based on these facts, the representative engaged in prohibited conduct by knowingly making false statements and presenting false evidence, subjecting them to suspension or disqualification from practicing before us and possible criminal penalties, including a fine and incarceration (see section 208 of the Act).

•
Example 2: A claimant calls the FO to state that a representative filed a claim on their behalf without authorization. The representative had submitted an online first-party application on the claimant's behalf following a phone call in which the claimant only inquired about the possibility of filing for SSI. Based on these facts, the representative appears to have impersonated the claimant and engaged in prohibited conduct that could subject them to suspension or disqualification and possible criminal penalties, including a fine and incarceration (see section 1106 of the Act).

2. Unauthorized disclosure of beneficiary information

A representative shares an office with an independent insurance agent. The insurance agent proposes to pay the representative a “finder's fee” for the name, address, and monthly benefit amount of each of their clients whom we award benefits. The agent sees these beneficiaries as prospective customers for the medical insurance plans they are selling that will supplement the coverage provided by State and Federal programs. The representative agrees to the proposal and, without obtaining consent from any beneficiary, provides a list containing personal information of their clients. Based on these facts, the representative engaged in prohibited conduct because they divulged information that they obtained from us, which contains personal information of beneficiaries, without any beneficiary’s written consent (see GN 03970.010C). This conduct could subject the representative to suspension or disqualification from practicing before us, and possibly criminal penalties such as fine and incarceration, (see section 1106 of the Act).

3. Knowingly charging or collecting unauthorized fees

After we approve $3,000 in representative fees for a successful Title II claim, a representative contacts their client to collect the fee from the beneficiary directly. The representative demands $4,000 from the beneficiary, stating that the fee approved by us does not truly represent the time and effort they had put into this case. The representative engaged in prohibited conduct by charging (and potentially collecting and retaining) a larger fee than we authorized, subjecting them to possible suspension or disqualification from practicing before us and possible criminal penalties based on this conduct (see section 206 of the Act).

NOTE: If the representative had assigned direct payment of their fee to an entity, and the entity’s POC was the one to demand $4,000 from the beneficiary, the assigning representative did not engage in any prohibited conduct. Instead, the POC has violated our rules by charging (and potentially collecting and retaining) a larger fee that we authorized. The POC may be subject to possible suspension or disqualification and possible criminal penalties, but is not financialy responsible for repayment of any excess fee the claimant paid to the entity. If the POC collected and retained any part of the excess fee themselves, however, they would be financially responsible for repayment of that amount to the claimant. If the entity fails to remit the excess fee, see GN 03920.052.

GN 03970.017 Referrals of Possible Fee Violations and Non-Fee Violations

A. Introduction to referrals of suspected violations

The Field Office (FO), Processing Center (PC), Disability Determination Services (DDS), the Office of Hearings Operations (OHO), or Office of Appellate Operations (OAO) may discover evidence of possible fee and non-fee violations. For examples and definitions of violations and non-violations, see GN 03970.013.

The FOs and PCs are responsible for developing and documenting the evidence to support alleged violations and for assisting the Office of the General Counsel (OGC) with any additional development after the referral. DDS staff will follow their internal procedures as well as the instructions in DI 31001.010D to collect supporting information and refer an alleged violation to the appropriate regional office. OHO and OAO staff will follow the instructions in Hearings, Appeals, and Litigation Law (HALLEX) manual I-1-1-50.

NOTE 1:

If we directly pay a representative or affiliated entity a fee in excess of the authorized fee, the error may result in a fee violation if the representative does not return the excess fee on receipt or following our request, or a non-fee violation if the entity's point of contact (POC) does not make a good-faith effort to cooperate with us and assist in returning the excess fee. Process direct payment errors using the instructions in GN 03970.025 and GN 03920.051. For instructions on how to handle excess fees paid to an entity, see GN 03920.052. If the POC does not make a good-faith effort to cooperate with us or actively refuses to assist in remitting an excess or erroneous fee paid to the entity, develop and refer as a non-fee violation as described later in this section. For additional information about the assignment of direct payment of fees, including the roles and responsibilities of POCs, refer to GN 03920.021.

Use the instructions in GN 03970.017B or GN 03970.017C to develop and refer a representative for possible fee violations, and GN 03970.017D and GN 03970.017E to develop and refer representatives, including POCs, for non-fee violations. For information on pursuing recovery of excess fee payments made to an individual representative, refer to GN 03920.051.

NOTE 2:

Do not use the instructions in GN 03970.025 to process fee violations made by a non-attorney representative who is not eligible for direct payment and who improperly obtained direct payment. For more information on processing direct payment error fee violation, see GN 03970.025. Instead, proceed to the referral instructions in GN 03970.017B or GN 03970.017C. If the representative inadvertently (i.e., because of our error) obtained direct payment, they did not violate of our rules, and no referral is needed unless we pursue recovery of the fee, and the representative does not cooperate. See GN 03920.051 for information on when we will pursue recovery of an excess fee.

B. Procedure for FO development and referral of possible fee violations

1. Develop the possible fee violation as fully as possible

Possible fee violations are those related to charging and collecting a fee. A possible fee violation occurs when a representative collects a fee that we did not authorize or collects a fee in excess of the amount we authorized. For other examples of a possible fee violation, refer to GN 03970.013B.

When a possible violation arises, use common sense and good judgment. In some situations, a suspected violation might be a simple misunderstanding that our technician can resolve with a contact. For example, a non-attorney selects the wrong box on the SSA-1696 (Claimant's Appointment of a Representative) and mistakenly presents themselves as an attorney. After a brief phone call, the representative sends an amended SSA-1696 to correct the error, and our technician determines that the error was unintentional.

At other times, a contact may even rectify the issue before it becomes a violation. For example, we mistakenly pacy a representative $1000 in excess of the fee we authorized. Upon notification by our technician, the representative agrees to return the excess fee. In this case, and other suspected fee violation cases (e.g., direct payment errors, unauthorized fees, fees in excess of the authorized amount), allow the representative 30 days to correct the problem. If at the end of that period, the representative has not taken any action to correct the problem, develop and refer possible fee violations following the instructions outlined in this subsection. In those cases where limited information is available, collect as much information as possible. For sample notice language for duplicate or excess payments, refer to GN 03970.025C. See GN 03920.051 for information on recovering excess or otherwise erroneous fees paid to a representative.

NOTE 1:

If the suspected violation is criminal or involves fraud do not contact the representative (see instead GN 03970.016). For a possible non-fee violation (e.g., the representative failed to provide competent representation), refer to GN 03970.017D.1. (in this section), regarding whether to contact the representative.

However, you may contact a representative if the alleged violation relates to the requirement for electronic filing of an appeal or submission of evidence. You may do so prior to referring the case to OGC to inform the representative of our rules and to ascertain whether the alleged violation was a deliberate act or an oversight. When you believe that a representative has violated the duty to assist the claimant to provide required evidence, you can refer the matter to OGC pursuant to GN 03970.017F (in this section).

NOTE 2:

If an entity retains an excess or otherwise erroneous fee despite our requests to remit it, refer to the instructions in GN 03920.052. As a reminder, we do not sanction entities and the Rules of Conduct and Standards of Responsibility for Representatives do not apply to entities.

IMPORTANT: Keep the referral development information in a separate electronic file. Never store referral development in the claim(s) file.

a. Review the claim(s)

If there is a paper folder and it is not in the FO, request the claim(s) file. If the claim(s) file is a certified electronic file (CEF), search eView or Evidence Portal, or, if the office to which you are referring the case has no eView or Evidence Portal access, create a Portable Document Format (PDF) copy of the file according to the instructions in DI 81001.035.

b. Request proof of payment

In cases where the payment of the fee is material and we have paid the representative directly, you may view the Treasury Check Information System (“TCIS”) to obtain proof of payment.

In cases where the claimant, beneficiary, or recipient has paid the representative directly, ask the individual(s) to provide you with proof of payment of the unauthorized fee (e.g., cancelled checks, credit card receipt, billing statement from the representative, money order receipt, or a letter or note from the representative mentioning the payment).

c. Complete form SSA-5002 (Report of Contact (ROC))

Complete a report using an SSA-5002. Include a detailed description of the possible violation. Use the following instructions to complete the report.

1.
Identify who:

Identify who (e.g., claimant, representative payee if applicable, representative, POC, or witnesses) is involved in or is a witness to the event that led to the possible violation.

List the names, addresses, and telephone numbers of the representative, claimant, beneficiary, or recipient. Explain whether the representative involved was acting as the claimant’s representative, an entity’s POC, both, or neither.

NOTE:Although POCs are responsible for acting on an entity’s behalf to resolve fees issues or errors, the actions of others affiliated with an entity may also result in a possible fee violation. For example, someone other than the representative or POC (e.g., an unappointed managing partner or another representative employed by the same entity) may request or collect an unauthorized fee for themselves or they may fail to properly oversee those under their supervision. Be sure to identify all such individuals involved in the violation. Do not refer others simply because they are affiliated with the same entity as the individual suspected of the possible fee violation

List the names, addresses, and telephone numbers of any witness, indicating the witness’s relationship to the claimant, beneficiary or recipient, or the representative or POC.
2.
Explain what:

Explain the events (actions on the part of the representative and the claimant) that led to the possible violation. For the different violation types, refer to the examples in GN 03970.013. The following bulleted list provides examples of the type of information needed in the explanation:
- •
  Actions on the part of the representative include actions such as requesting and receiving unauthorized fees;
- •
  Actions on the part of the claimant include receiving the request for payment, paying the fee, and receiving a receipt as proof of payment of the unauthorized fees;
- •
  Circumstances that led the claimant to question the fees that the representative charged (e.g., the fee notice or another person’s input);
- •
  Identify whether the fee was in addition to any fee(s) that we authorized or if fee collection was completely unauthorized;
- •
  If we authorized the fee, indicate whether we authorized it through a fee petition or a fee agreement;
- •
  If we authorized the fee, indicate whether we paid it directly and, if so, whether we certified payment to the individual representative;
- •
  Determine and document whether the representative collected any money to recover costs or expenses; and
- •
  Determine and document whether the claimant had entered into an agreement to deposit any of the fee into a trust or escrow account. For more information on escrow accounts, refer to GN 03920.025.
3.
Identify when:

Identify when the events took place, as described in the following list:
- •
  List the date the claimant received the billing statement or request for payment of the unauthorized fee(s);
- •
  If the fee was paid, determine the date the claimant or we paid the unauthorized fee to the representative; and
- •
  Indicate when the claimant realized that the representative charged an unauthorized fee.
4.
Identify where:

Identify where the events took place (e.g., the claimant’s home; the representative’s office; a bank or check cashing facility; through the mail).
5.
Explain how:

Explain how the events took place, as described in the following list:
- •
  How much did the representative charge;
- •
  How did the representative request the unauthorized fee (e.g., orally or a billing statement) and who (e.g. the representative, the POC, or another individual affiliated with an entity or employed by the representative) requested it;
- •
  How much did the claimant pay;
- •
  If paid, how did the claimant pay (e.g., cash, check, money order, credit card, or provided a personal service for the representative);
- •
  Whom did the claimant pay; and
- •
  How did the representative acknowledge payment (e.g., issuing a receipt, sending a letter or note mentioning the fee payment, or orally. If orally, is there a voicemail message on the claimant’s, beneficiary’s, or recipient’s phone.)
6.
Identify claimant, beneficiary or recipient, and representative
7.
Identify FO point of contact

List the FO’s point of contact, including the contact’s name, title, and telephone number (with the extension, if applicable).

d. Obtain copies of all documents and notices

Obtain copies of any documents and notices and any other evidence not already mentioned that support the information that you provided in preparing the SSA-5002. For example, claimants, beneficiaries, or recipients often have letters or electronic communications (e.g., email, text, or voicemail messages) about the fee, so provide a copy of the written communication or make a note of the oral communication on an SSA-5002. In addition, include pertinent notices from the Online Retrieval System (ORS) and documents from the Evidence Portal (EP) or eView.

e. Obtain signed statements, if available

Obtain signed statements from any individual with direct knowledge of the facts involved, including the claimant, beneficiary or recipient, payer, and any other witnesses. Do not contact the representative for a statement. The statements should provide all details related to the events leading to the fee violation. If an individual will not cooperate or sign a statement, record this information on an SSA-5002.

f. Documenting the claimant-representative relationship

If available, include in the referral file a copy of the SSA-1696 (or other notice of appointment for appointments that ended prior to December 9, 2024 ); written and signed documentation of a fee arrangement between the parties; and documentation that we recognized the individual as the claimant’s representative such as a copy of the RSR103 - Appointment Confirmation to Representative [Without Assignment] (see GN 03905.035B).

2. Request management review

Once you complete the development of the violation, request that a member of management review the file to ensure that we fully developed the violation.

Management will document the review and approval of the referral on an SSA-5002 before forwarding the case to the next level.

3. Referral after management review is complete

Forward the development, claim(s) file, or PDF copy, and, if applicable, proof that we have already offered the representative the opportunity to correct the suspected fee violation to the servicing regional Center for Programs Support (CPS) with jurisdiction over the referring office. Refer to GN 01070.105 for instructions on locating regional CPS contact information. When CPS finishes reviewing the case, CPS refers the case to OGC. See the policy for suspected criminal violation referrals in GN 03970.016. Refer any additional development or inquiries to CPS.

NOTES:

•
If the claim(s) is a paper folder, complete any adjudicative or post adjudicative FO actions that you might need prior to forwarding the claim(s) file.
•
If you are unable to retain the original documents the claimant provided (check, receipt, or bills), make clear and readable certified copies of these documents. If necessary, OGC will use it as evidence at any sanctions proceeding.
•
The Office of Central Operations (OCO) must follow the procedures listed for the Processing Centers.
•
Headquarters components other than OCO must refer the case to the CPS in the servicing regional office.

C. Procedure for PC development and referral of possible fee violations

1. Develop the possible fee violation as fully as possible

Use the following instructions to develop and refer possible fee violations:

a.
If the paper claim(s) file is not in the PC, request it. If the file is a CEF, create a PDF copy of the file only if the office receiving the referral does not have access to eView or Evidence Portal. For more information on copying a CEF to PDF, see DI 81001.035.
b.
If the payment of the fee is material to the development and we paid the representative directly, include a note in the file but do not request proof of the payment (such as, checks or direct deposit confirmation). Ask the claimant, beneficiary, or recipient to provide you with proof of payment of the unauthorized fee, if the claimant, beneficiary, or recipient paid the fee directly. For more information about obtaining proof of payment, refer to GN 03970.017B.1 above.
c.
To complete a report about the violation, follow the instructions in GN 03970.017B.1.c.

2. Request management review if local office instructions require it

Once you complete development, request that management review the case to ensure that development of the possible violation is complete. If management review is not required by your local office proceed to the next step.

3. Management review is complete

Once the management review is complete (if needed), forward the development information, claim(s) file, PDF copy, and, if applicable, proof that we already offered the representative or entity the opportunity to correct the potential fee violation to the Operations Support Branch (OSB) for your PC. Refer any further development to OSB.

The PC is responsible for assigning an individual to review violation referrals to ensure that development is complete.

D. Procedure for FO development and referral of possible non-fee violations of the Rules of Conduct and Standards of Responsibility for Representatives

Non-fee violations are not directly related to charging and collecting a fee. Some non-fee violations may also qualify as criminal violations. For a definition and examples refer to GN 03970.013.

1. Develop and refer non-fee violations

Use the following instructions to develop and refer a non-fee violation:

a.
If the possible violation involves a particular claim(s) and a paper claim(s) file exists, request the claim(s) file if it is not in the FO. If the file is a CEF and the receiving office does not have access to eView or Evidence Portal, create a PDF copy of the file. For instructions on how to copy a CEF to CD, refer to DI 81001.035.
b.
Use the instructions in GN 03970.017B.1.c., as a guide to complete a report on an SSA-5002 or SSA-1666 about the possible violation.
c.
If applicable, obtain copies of other pertinent evidence, such as a State Bar notice of disbarment or suspension of a representative or POC, or any document proving the disbarment (e.g., a local newspaper article announcing the disbarment).
d.
Obtain copies of any documents and any other evidence not already mentioned that support the information you provided in your report.
e.
As appropriate obtain signed statements from the claimant, beneficiary or recipient, and any possible witnesses detailing the events leading to the possible non-fee violation. If any individual refuses to cooperate or sign a statement, document this information on an SSA-5002 or SSA-166.
f.
Contact a representative about a failure to use our electronic services when required follow the instructions in GN 03970.017F.1. You may also contact suspected violators of our duty to submit evidence, as described in GN 03970.010B. Obtain the non-submitted evidence or evaluate the representative’s explanation for not submitting the evidence to determine whether to refer the case to OGC. If you contact the representative for either reason, explain the relevant policy and document the representative’s explanation on a SSA-5002 or SSA-166.

Do not contact the representative, including a POC for a statement regarding any other possible non-fee violation.
g.
Important: Never store any referral development in the claims file.

2. Management review

Once development is complete, ask management to review the file to ensure that the possible violation is fully developed.

3. Management review is complete

Once the management review is complete, forward all development information and the claim(s) file or PDF copy to the regional Center for Programs Support (CPS) with jurisdiction.

Refer any further development to the regional CPS. After CPS refers the matter to OGC per GN 03970.016, CPS will continue to review and forward any additional development materials to OGC.

NOTE:

If you need the paper claim(s) file to complete any adjudicative or post adjudicative action in the FO, complete the actions prior to mailing the file.

E. Procedure for PC development and referral of non-fee violations of the Rules of Conduct and Standards of Responsibility for Representatives

1. Develop and refer non-fee violations

Use the following instructions to develop and refer all possible non-fee violations:

a.
If a paper folder is involved and it is not in the PC, request the folder. If the claim(s) file is a CEF and the receiving office does not have access to eView or Evidence Portal, create a PDF copy of the file. For instructions on how to copy a CEF to PDF, see DI 81001.035.
b.
As a guide on how to complete a report about the violation, see paragraph GN 03970.017B.1.c.
c.
If the referral needs additional development, request that the FO complete the development and forward it to the PC per GN 03970.017D.1.c.

2. Request management review if local office instructions require it

Once development is complete, request the assigned reviewer to review the file, to ensure that the referral is complete and fully developed. If management review is not required by your local office proceed to the next step.

3. Management review is complete

Once management completes the review, forward the development information and claim(s) file or PDF copy to the CPS (OCO) or OSB (PC) of jurisdiction.

Refer any further development to CPS and OSB. After the initial referral, CPS or OSB will continue to review and forward additional development materials to OGC.

F. Referring possible violations of the requirement to use our electronic services

1. iAppeals requirement

While we usually process possible violations of the electronic services requirement the same way we process other possible non-fee violations, there are special considerations for these alleged violations. We want to provide representatives with reasonable opportunities to follow our rules related to electronic services. FO personnel using good judgment and reason, and with management approval, may refer representatives to OGC for potential sanctions after reminding the representatives of the requirement. To determine whether to refer a representative, consult the examples in GN 03970.013C. Document your contacts on an SSA-5002. Please do not refer the case to OGC if it appears that the representative’s failure to use the required electronic service was an isolated incident, unintentional, caused by computer error, or otherwise excusable.

2. iAppeals requirement referral procedure

To develop the referral, follow the procedures described in GN 03970.017B.1.c., and also take the following actions:

a.
Compile all the written reminder notices and other records documenting communication with the representative, such as the standard warning letters in GN 03970.017F.3, as well as any reports of contact documenting conversations with the representative, in person or by telephone.
b.
Print from the CEF or make copies (non-electronic folder), or attach to an email the Form SSA-1696 containing the representative’s appointment and the representative’s request for direct payment .
c.
Compile all supporting evidence (e.g., notations on the developmental screens) and any written responses received from the representative following the FO’s written reminders.
d.
Prepare an SSA-5002 or SSA-166, and include a detailed description of why you think the representative has violated the electronic filing rule, along with the first and last names and Social Security Number (SSNs) of the cases used to substantiate the referral. Include the representative’s SSN or RepID, if known.
e.
Do not annotate any claim systems. Keep this referal development documentation in a separate paper or electronic file in the FO. Either refer the representative to OGC for an investigation within two years or destroy the file.
f.
If OGC needs proof that the representative actually received payment in the case, develop as described in GN 03970.017B.1.b, and forward this information to OGC to associate with the prior referral.
g.
Even after the initial referral to OGC, continue to document any new instance of the representative’s failure to file certain appeals electronically, and submit them to OGC on a flow basis.

NOTE:

In situations where it appears the representative may have encouraged the claimant to personally file a paper appeal, but later submits a request for direct payment, you should contact the representative to remind them of the electronic filing requirement. If this pattern continues, and it appears that the representative is deliberately circumventing the rule to submit the reconsideration or hearing request online, then you should issue, with management approval, a written warning letter to the representative, using the language in the following subsection, GN 03970.017F.3. Include in the warning letter the names of the specific cases involved so that we will have documentation of the cases if needed for a future sanctions referral.

3. iAppeals requirement sample warning letter

The following is a sample “warning letter”notifying a representative of possible action for non-compliance with the electronic filing requirement. The Document Processing System (DPS) contains a sample of this letter, under the same name, “iAppeals Requirement Warning Letter” in the “general” category under “local” source.

Dear [insert representative’s name]:

We are writing to remind you when you must use our online appeal service. Our Rules of Conduct and Standards for Responsibility for Representatives require you to use our Internet Disability Appeals application when you request direct payment of fees on certain Social Security cases. These cases include appeals of medically denied Title II or Title XVI initial claims and reconsiderations pending at the hearing and Appeals Council levels.

It has come to our attention that you may not be complying with this mandate. Noncompliance may result in your suspension or disqualification.

We ask that you file an electronic appeal of a medical denial when you request or intend to request direct payment of your fee for a case. This requirement was published in the Federal Register at 77 FR 4653 and became effective March 16, 2012. You can find our Internet Disability Appeals application on our website at http://www.ssa.gov. Under the “benefits” tab of the main menu, select “apply,” then select “Appeal a decision we made.”

Below we list some of your cases in which you should have, but did not use our Internet Disability Appeals application:

[Insert Number Holders’ first and last names of all identified cases. IMPORTANT: list only cases with an active appointment and appeal pending.]

If we continue to receive improperly submitted appeal requests in cases where this mandate applies, we will refer the matter to our Office of the General Counsel for further investigation and possible action.

If you have any questions or wish to respond to this notice, please write to us or contact [us/if desired insert FO specific employee name] at [insert phone number.]

Sincerely,

Field Office Manager [optional]

GN 03970.020 Evaluation and Action on Field Office (FO) and Processing Center (PC) Referrals

A. Introduction to Center for Programs Support (CPS) and Operations Support Branch (OSB) referrals

The CPS in each regional office and the OSB in each PC is responsible for determining the category of possible fee violations, which are described in GN 03970.013.

B. CPS and OSB procedure for possible fee and non-fee violations

1. Determine the type of possible violation

Review the report to determine what type of violation has potentially occurred and ensure that development is complete (see GN 03970.017). If any further development is necessary, request it from the appropriate Field Office (FO) or Processing Center (PC).

NOTE: If a referral to the ineligible for direct payment entities (IDPE) Coordinators was mistakenly forwarded to a CPS or OSB, staff will contact the referring individual to notify them of the mistake and to ensure that they properly send the referral to the IDPE Coordinators, as described in GN 03920.052.

2. Referring the matter to the Office of the General Counsel (OGC)

If CPS or OSB believes that the record is adequately developed and that the record demonstrates that the representative, including an entity's point of contact, engaged in misconduct, refer the record by email to OGC using the address in GN 03970.070A, attaching any development and evidence to the email. After the initial referral, CPS or OSB will continue to review and forward additional development materials to OGC.

To determine the best method of delivery for any non-electronic documentation, please reach out to OGC using the contact information in GN 03970.070.

GN 03970.025 Field Office (FO) and Processing Center (PC) Action on Direct Payment Error Fee Violations

A. Introduction to FO and PC actions on direct payment errors and possible fee violations

Direct payment errors occur when we pay a fee in excess of the authorized fee to a representative. For examples and additional information about direct payment errors, or excess fee payments, refer to GN 03920.051.

NOTE:

Excess fee payments made to an entity are not direct payment errors that can become fee violations, even if they involve suspected misconduct of a point of contact (POC). For instructions on resolving excess fee payments made to an entity, see GN 03950.052. For more information on when a POC may have violated the Rules of Conduct and Standards of Responsibility for Representatives see NOTE 1 in GN 03970.013A.1.

B. Procedure for FO and PC development of direct payment errors and possible fee violations

Before developing for a possible fee violation resulting from a direct payment error, attempt to recover the excess or otherwise erroneous fee payment by contacting the representative and explaining the error following the instructions in GN 03920.051D. If the representative agrees to and refunds the excess payment, there is no fee violation. If the representative does not agree to refund the excess payment, or fails to make the refund, proceed with the development in this subsection. See also GN 03970.017B.1.

Use the following instructions to process Title II and Title XVI possible fee violations resulting from direct payment errors:

1.
Request copies of all relevant United States Treasury checks (front and back) (GN 02406.140) or proof of direct deposits (GN 02406.007) issued to the representative. Authorized users in each FO and PC can retrieve this data online from the Treasury Check Information System (TCIS), if payment is less than two years old.
2.
Use the language and instructions in the following subsection, GN 03970.025C to prepare and send a notice only to the representative requesting repayment of the excess fee.

NOTE:

Use language that is neutral in tone and not presented in a confrontational manner. Generally, representatives follow our rules. Therefore, we must be positive in the determination of a possible violation and its presentation. Refer questions to the Office of the General Counsel (OGC) using the contact information in GN 03970.070.

Unfranked return envelope

D. Procedure for processing representative’s response to a notice

1. Representative agrees and complies

Take the following actions if the representative complies with the notice:

a.
Document the file, Debt Management System (DMS), and Modernized Claim System (MCS) with a Report of Contact (RPOC) or SSA-5002 to record receipt of a full refund and for Title II claims establish a recovery of overpayments, accounting and reporting (ROAR) record via the SMED screen per the instructions in SM 00610.772B.7;
b.
Process the remittance for credit to the trust fund for Title II refunds, to the general fund for Title XVI refunds, or both, per FO instructions in GN 02403.006 and PC instructions in its Operations Bulletins. Using DPS or AURORA, send the representative a brief letter to acknowledge receipt of the check. Use the following language:

This acknowledges receipt of your payment of $ [enter amount of payment] in the claim of [NH’s first and last name].

Since the issue of the fee collection is settled, we now consider the matter closed.

Social Security Administration
c.
Ensure that the notice appears in the Online Retrieval System.

2. Negative response or no response

If the representative responds negatively to the request for refund, denies receipt of the duplicate or erroneous payment, or fails to reply within the required time, develop the fee violation per the instructions in GN 03970.017. Refer to GN 03970.013 for definitions of violations.

3. Representative inquiries

If the representative responds to the letter by requesting an explanation or further documentation, the FO and PC will comply with the request, if possible, and document the steps taken to resolve the issue(s) raised. If the matter remains unresolved, complete development for a referral to OGC.

E. References

•
GN 02403.003 The Field Office Remittance Input
•
GN 02403.004 How to Handle Remittances in the FO Mailroom and Reception Area
•
GN 02403.005 Examining Remittances Received in the FO
•
GN 02403.006 Processing Remittances Received in the FO
•
GN 02405.000 Processing Unendorsed Returned Benefit Checks - Title II and Title XVI
•
GN 02405.006 Returning Unendorsed Checks to the Field Office
•
MS 01103.001 Debt Management System Remittance Process – Overview
•
MS 01103.003 PC Remittance Input (REMI)
•
MS 01103.006 Field Office Remittance Input (RFOR)

GN 03970.030 Action to Suspend, Disqualify, or Withdraw Charges Against a Representative by the Office of the General Counsel (OGC)

A. Introduction to General Counsel’s authority

The Commissioner has delegated to the General Counsel the authority to initiate, withdraw, and settle representative sanction cases against representatives. The General Counsel has redelegated these responsibilities to OGCߴs Office of General Law (OGL).

With respect to the procedures described in this section, the term “General Counsel” also includes any authorized designees of the General Counsel.

As discussed in GN 03970.010D, an entity’s point of contact (POC) is considered a “representative” for purposes of the Rules of Conduct and Standards of Responsibility for Representatives, regardless of whether the POC provides representational services. In addition to suspension or disqualification from serving as a representative before us, an individual POC who is sanctioned may not serve as a POC.

B. Policy for OGC’s notification to a representative of charges and proposed sanctions

The General Counsel has authority to initiate sanction proceedings against a representative. OGC prepares a notice of charges and proposed sanctions against the representative, including a POC. If the General Counsel or authorized designee signs the charges, OGC serves this notice on the representative by certified or registered mail to the representative’s last known address. The notice advises the representative to file an answer with OGC stating why the representative should not be suspended or disqualified from acting as a representative before us or from serving as an entity POC and informs the representative that failure to respond in writing will preclude the representative from presenting evidence during any sanctions proceedings.

When a POC is suspended or disqualified, and that sanction becomes final, their entity will become ineligible for direct payment of fees unless or until the entity names a new, qualified POC. In order to provide the entity and POC notice and to allow the entity ample time to name a new POC, if desired, OGC will also address this potential ineligibility in the cover letter to the notice of charges and proposed sanctions served on a POC. We expect the POC to inform their entity of the contents of this notice, any sanctions proceedings, and the ultimate outcome of those proceedings. If the entity does not update its registration with a qualified POC before the existing POC’s sanction becomes final, follow the instructions in GN 03970.060D.4.

C. Policy for representative’s answer

The representative's answer must be in writing, signed under oath (or affirmation), and filed within 14 business days from the date of the notice, or from the date the notice was delivered personally to the representative. The representative may request an extension to file an answer and present good cause as to why the representative needs the extension. Upon a finding of good cause, OGC may extend the representative’s time for filing an answer. The representative must file the answer with OGC at the address indicated in the notice. If the representative fails to file an answer, files an untimely answer without good cause, or files a defective answer, the representative will not have the right to present evidence at a hearing. However, even if the representative loses the right to present evidence, the hearing officer may still permit the representative to present a statement about the sufficiency of the evidence or the validity of the proceedings.

D. Policy for withdrawal by OGC of charges prior to the hearing

If the representative's answer or the available evidence establishes to the satisfaction of OGC that the representative should not be suspended or disqualified from acting as a representative before us or from serving as an entity POC, OGC may withdraw the charges. OGC mails the notice of withdrawal of the charges to the representative at the representative's last known address.

E. Policy for OGC’s action initiating a hearing on the violation

If OGC does not receive an answer within the time allowed, or withdraw the charges, OGC will ask the Office of Hearings Operations (OHO), Office of the Chief Administrative Law Judge, to designate an administrative law judge to serve as the hearing officer to adjudicate the case.

F. Policy for OGC’s action when the representative accepts the sanction

A representative may accept a proposed sanction by submitting to OGC a signed written statement in which the representative waives the right to a hearing and agrees to accept the sanction. On receipt of the statement, OGC may impose the proposed sanction or reject the statement. If OGC rejects the statement, OGC may:

•
Ask the representative to sign an acceptable statement;
•
Attempt to enter into a settlement agreement with the representative; or
•
Proceed with the sanction case.

G. Policy for OGC’s action in a settlement agreement with the representative

Only OGC may enter into settlement agreements with representatives to resolve sanction cases. OGC may settle a case even before filing charges against a representative.

The parties may agree to any terms that are not in violation of Federal law or regulation. If the parties sign a settlement agreement before OGC asks OHO to designate a hearing officer, the agreement becomes effective according to the terms of the agreement. If the parties sign the settlement agreement after OHO designates a hearing officer, the agreement becomes effective when the designated hearing officer enters the agreement into the record, issues an order accepting the agreement, and dismisses OGC’s request for a hearing.

NOTE:

Field Office (FO) or Processing Center (PC) staff cannot negotiate any type of settlement with a representative regarding a sanctions matter. However, in situations regarding possible fee violations, the FO or the PC staff can close a case if the representative makes a full refund of the disputed amount upon request before the FO or PC refers the case to OGC. FO and PC staff must not inform the representative that the matter is closed if they will refer the representative to OGC because of the conduct that led to the direct payment error.

Example: If a representative collected money from a claimant without authorization in the amount of $3,000 and later returns the $3,000 pursuant to the FO’s request, the FO may close the case in their systems but make a referral to OGC. In this circumstance, FO staff must not inform the representative that the matter is closed because OGC may open a matter to investigate the representative’s conduct regarding the initial collection of the unauthorized fee.

Refer questions regarding this section to OGC using the contact in formation in GN 03970.070.

GN 03970.060 Field Office and Regional Office Action When a Representative is Suspended or Disqualified

A. Prohibition from representing during suspension or disqualification

1. Representative

An individual who was suspended or disqualified following sanctions proceedings is prohibited from representing claimants before the Social Security Administration (SSA). See GN 03970.030 for general information about the sanctions process. Once we issue a final decision to suspend or disqualify a representative, we administratively withdraw the individual from being the appointed representative for any claimant, beneficiary or recipient, or auxiliary on any matter pending before us. A claimant cannot appoint and we cannot recognize a suspended or disqualified individual as a representative. The suspended or disqualified individual cannot hire other representatives to work on their behalf or exercise any of the authority described in GN 03910.025.

2. Serving as a Point of Contact

In addition to the prohibition against providing representational services, a sanctioned individual may not serve as the POC for an entity. If the entity did not designate another individual who meets the necessary requirements to serve as a POC, the entity will be rendered ineligible for direct payment and will not receive any assigned direct payments unless and until the otherwise eligible entity names a new qualified POC on an updated Form SSA-1964. Once we process the updated Form SSA-1694 we will honor any assignments made prior to the entity’s lapse in eligibility, as long as we have not already paid a fee in that claim(s), and any timely assignments made after the entity regains eligibility.

For additional information about the assignment process and the role of the POC, refer to GN 03920.021. Refer to GN 03913.050 for additional information on registering and updating registration information for entities. For eligibility requirements for entities to receive direct payment of assigned fees, see GN 03920.016.

3. Fee

A sanctioned individual may not charge or collect a fee for representational services performed after the effective date of the sanctioned individual's suspension or disqualification. A sanctioned individual cannot legally provide representational services to claimants. As a result, the sanctioned individual may not receive authorization to charge or collect fees for those services. This limitation applies even if the sanctioned individual had validly assigned direct payment of their fee to an entity as described in GN 03920.021.

Although a representative may be entitled to a fee for services that the representative provided up to the date of their suspension or disqualification, the representative cannot receive direct payment of any fee after the effective date of their sanction. In addition, when the representative had assigned direct payment of their fee, the affiliated entity will not be able to receive direct payment of any fee authorized, even for services performed before the representative’s suspension or disqualification. Because a representative must be eligible to receive direct payment to assign direct payment to an eligible entity, the sanctioning of a representaitve invalidates any existing assignments (see GN 03920.021).

a. Fee agreement

We will disapprove a suspended or disqualified individual’s fee agreement if we favorably decide the claim after the effective date of the individual’s sanction.

b. Fee petition

A suspended or disqualified individual may petition us to authorize a fee for services provided on or before the effective date of the sanction. However, they may not petition for a fee for services provided after the effective date of the sanction because the individual is prohibited from acting as a representative after that date.

NOTE 1:

In the limited circumstances described in GN 03930.020A when a representative is deceased, we will accept a fee petition submitted by one of the other individuals listed in that subsection. When the deceased representative was sanctioned, any assignment is invalidated and the entity’s point of contact (POC) may not submit the fee petition. Instead, like the representative, the other individuals listed in GN 03930.020A may file the fee petition only for services the representative performed before the effective date of the representative’s sanction.

NOTE 2:

Even though a sanctioned individual may seek and receive authorization to charge and collect a fee for services provided on or before the effective date of their suspension or disqualification, they are not eligible for direct payment of the authorized fee. Therefore, collection of the authorized fee is a matter between the santioned individual and the claimant, or one of the other individuals listed in GN 03930.020A and the claimant in the limited circumstances described in that subsection. For information on payment of the fee, see GN 03920.016.

B. Prohibition on indirect representation and indirect fees for suspended or disqualified individuals

1. Suspended or disqualified individual as an employer

a. Representation

A suspended or disqualified individual may not employ others, either directly or indirectly (i.e., through another person or business entity), to represent claimants or beneficiaries before us.

We consider a sanctioned individual who provides representational services to others through employees, to be indirectly providing representational services in violation of the suspension or disqualification decision. If any office discovers a possible violation, the office will develop and refer the case to the Office of the General Counsel (OGC) per GN 03970.017 or GN 03970.025 as applicable.

b. Fee

When a representative employed by a sanctioned individual receives a fee for the representational services they performed, the representative cannot hand over this fee or any portion of this fee to the sanctioned individual. If the representative hands over the fee, any amount collected by the sanctioned individual is an indirect collection of an unauthorized fee for providing representational services and the sanctioned individual has collected it in violation of our Rules of Conduct and Standards of Responsibility for Representatives discussed in GN 03970.010.

A representative employed by an entity may continue to assign direct payment of their fee to that entity as described in GN 03920.021 even if another individual(s) associated with that entity is sanctioned. If the representative authorized a fee or any other person, including the entity's POC, attempts to transfer the fee to the sanctioned individual, any amount collected by that individual is an indirect collection of an unauthorized fee and a violation of the Rules of Conduct and Standards of Responsibility for Representatives. Although we do not ordinarily investigate the contractual and payment relationships between entities and their salaried employees, if any office is made aware of a possible violation, they will develop and refer the individual representative(s) they suspect were involved to the Office of General Counsel (OGC) per GN 03970.017 or GN 03970.025, as applicable.

2. Suspended or disqualified individual as an employee

a. Representation

A suspended or disqualified individual may neither be employed by, nor make arrangements to be employed by, a representative or entity to perform any actions related to a claim or potential claim before us as normally allowed under GN 03910.025. Such prohibited actions include the following:

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Interpreting agency law and policy;
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Requesting access to claimant records;
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Interviewing or advising Social Security applicants, claimants, beneficiaries, or recipients;
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Presenting evidence;
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Appearing at hearings;
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Examining witnesses;
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Filling out agency forms; and
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Drafting or signing pleadings and briefs.

Sanctioned individuals who perform such actions are indirectly providing representational services and are in violation of the suspension or disqualification.

A representative who knowingly assists a sanctioned individual in providing representational services can also be subject to sanctions under Social Security regulations, 20 CFR 404.1740(c)(12) and 416.1540(c)(12). If you suspect that a representative is assisting or employing a sanctioned individual to provide representational services to claimants, you should immediately refer the matter to OGC under the procedures described in GN 03970.017.

b. Fee

A sanctioned individual, who receives a salary or a fee for performing duties (as described in GN 03970.060B.2.a) delegated by another representative or entity, is indirectly collecting an unauthorized fee for indirectly providing representational services. The sanctioned individual who receives such salary or fee is in violation of the Rules of Conduct and Standards of Responsibility for Representatives, see GN 03970.010.

C. Action when a suspended or disqualified individual continues to act as a claimant’s representative

So long as a suspended or disqualified individual continues, directly or indirectly, to perform representational services or collect fees or a salary for performing representational services, we will not reinstate that individual to practice before us.

In addition, we may initiate a new sanction proceeding against an individual, if the individual’s period of suspension has ended, but while suspended, the individual directly or indirectly performed representational services, collected any fees, or received a salary for performing representational services. We may initiate such proceedings based on the individual’s failure to conduct the individual's dealings with us in a manner that furthers the efficient, fair, and orderly conduct of our administrative decision-making process; on their violation of our fee regulations; on their failure to comply with our sanction decision; or on other applicable law or regulation. See 20 CFR 404.1740(c) and 20 CFR 416.1540(c).

D. Field Office (FO), Regional Office (RO), or referring office’s responsibilities after a representative is suspended or disqualified

1. Notifying the suspended or disqualified individual’s claimants, beneficiaries, or recipients

When the decision to suspend or disqualify a representative is final and entered into the Registration, Appointment and Services (RASR) application, RASR will automatically terminate all appointments and will send the claimant an automated notice of the termination (see RASR User Guide). When the suspended or disqualified individual is the principal appointed representative, RASR will also:

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Communicate new and updated appointed representative information to downstream applications (e.g., MCS, MSSICS, EDCS); and
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Automatically notify the electronic folder (EF) of appointment changes. This notification will also notify Disability Determination Services (DDS) systems.

FO staff will review MS 09106.003 RASR – Query: Appointments Terminated Due to AR Sanctions List to determine whether there are any claimants or beneficiaries with pending claims who have not been notified of the sanction and provide the appropriate notice (GN 03970.065). Staff must also ensure that the Master Beneficiary Record (MBR) and the Supplemental Security Record (SSR) are annotated with the appropriate special message explaining the reason for the termination. For any further guidance, staff will consult with OGC using the contact information in GN 03970.070.

2. Suspended or disqualified individual attempts or continues to act as a representative

If a suspended or disqualified individual attempts to act as a representative by providing representational services, the employee who learns of this attempt must notify their supervisor and take the following actions:

a.
Document the representative's actions (i.e., make copies of all letters or other documents that show the sanctioned individual’s attempts to act as a representative).
b.
Notify the claimant and other parties as needed in the following situations:
- •
  Individual continues to act as a representative
  
  Use Document Processing System (DPS) or Manage Text (AURORA) letterhead and the sample language in GN 03970.065A. to notify the claimant of the individual’s suspension or disqualification. Address the letter to the claimant with a copy to the sanctioned individual.
- •
  Individual acts as the assistant to another appointed representative
  
  If the sanctioned individual acts as the assistant to another appointed representative and contacts us on behalf of a claimant or the employing representative, inform the claimant that we will not communicate with or accept correspondence from the sanctioned individual. In DPS or AURORA, use the sample language in GN 03970.065B. to notify the claimant of the individual’s suspension or disqualification. Address the letter to the claimant and send copies to the sanctioned individual and the appointed representative.
- •
  Individual provides representational services through their employee
  
  If the sanctioned individual is employing another individual to provide representational services to a claimant and the claimant appointed the employee to be their representative, use the sample language in GN 03970.065C. Notify the claimant of the employing individual’s suspension or disqualification and inform the claimant that the sanctioned individual cannot indirectly provide representational services to the claimant or indirectly collect a fee. Also, advise the claimant that the representative who is not sanctioned can continue to represent the claimant unless OGC takes an action against that representative. Address the letter to the claimant and send copies to the sanctioned individual and the claimant’s appointed representative (i.e., the employee of the sanctioned representative).
  
  Notify OGC of the sanctioned individual’s continued activity by forwarding all documentation of the sanctioned individual’s representation attempts and notices sent to the claimant to OGC by email using the contact information in GN 03970.070.

3. Suspended or disqualified individual insists on recognition by Us

If the suspended or disqualified individual insists that we recognize them as the representative in a case, OGC will advise the individual that we can neither recognize nor deal with them. In addition, OGC will refer the matter to the Office of the Inspector General. See information on detecting and developing program violations in GN 04110.000.

NOTE: Refer questions regarding this section to OGC using the contact information in GN 03970.070.

4. Suspended or disqualified individual is serving as a POC at the time their sanction becomes effective

If the suspended or disqualified individual is serving as an entity POC at the time their sanction becomes effective, their entity becomes ineligible to receive direct payment unless and until the entity designates a new POC (see GN 03920.021 and GN 03970.060A.1 in this section). In this situation, OGC will notify the Center for Programs Support (CPS) in the RO where the entity and POC are located (using the registration address for the entity). CPS staff will immediately refer the matter to the ineligible for direct payment entity (IDPE) coordinators and send notice to the entity about its ineligibility using DPS or AURORA and the sample language in GN 03970.065E. If the individual sanctioned is not acting as a POC at the time their sanction becomes effective (e.g., the entity properly named a new POC) these additional steps are not necessary because the entity remains eligible for direct payment.

E. References

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GN 03910.020 Qualifications for and Recognition of Representatives
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GN 03910.025 Authority of Appointed Representatives
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GN 03910.060 When a Representative's Appointment Ends
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GN 03920.005 Representative's Fees Subject to SSA's Authorization
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GN 03940.003 Fee Agreement Evaluation
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GN 03970.065 Field Office's Sample Notices of Suspension or Disqualification

Center for Program Support, Region ##

Office of the General Counsel

GN 03970 TN 21 - Suspension or Disqualification of Representatives - 9/30/2024

POMS Recent Change

GN 03970.010 Rules of Conduct and Standards of Responsibility for Representatives

A. Introduction to the Rules of Conduct and Standards of Responsibility for Representatives

B. Affirmative duties for a representative

C. Prohibited actions for representatives

D. Referrals and Initiating Sanctions Process

GN 03970.011 Potentially Unqualified Attorney and Non-Attorney Representatives

A. Procedure for handling pending claims, matters, or issues with a potentially unqualified attorney representative

B. Procedure for handling pending claims, matters, or issues with a potentially unqualified non-attorney representative

GN 03970.013 Definitions and Examples of Violations of the Rules of Conduct and Standards of Responsibility for Representatives

A. Definitions of violations

1. Fee violations

a. Total unauthorized fee collection

b. Partial unauthorized fee collection

2. Non-fee violations

3. Criminal violations

B. Fee violations: Examples of possible violations of our rules on charging, collecting, or retaining representative fees

1. Collecting an excess fee

2. Collecting a fee on behalf of a representative through a Power of Attorney (POA)

3. Collecting a fee without our authorization

4. Collecting a fee from an escrow account that exceeds the authorized amount

5. Failure to refund an unauthorized fee involving a duplicate fee payment by us

6. Charging and collecting an unauthorized fee based on a contract with a minimum fee

7. Indirect collection of a fee through third party payments and without our authorization

8. Arrangements to charge, collect, or retain a fee directly from a claimant's bank account

C. Non-fee violations: Examples of possible violation scenarios related to other rules of conduct and standards of responsibility

1. Failure to provide competent representation

2. Failure to file requests for appeals electronically

3. Failure to use the Appointed Representative Services (ARS) System

4. Failure to inform us about or submit required evidence

5. Delay proceedings without good cause

6. Withdraw in a manner that disrupts the processing of the case

7. Failure to provide evidence as soon as practicable

8. Misrepresentation of facts

9. Failure to properly disclose required information about opinion evidence

10. Failure to oversee individuals assisting on claims when the representative has managerial or supervisory authority over these individuals

D. Examples of violations subject to criminal prosecution

1. Knowingly make or participate in making a false statement or representation

2. Unauthorized disclosure of beneficiary information

3. Knowingly charging or collecting unauthorized fees

GN 03970.017 Referrals of Possible Fee Violations and Non-Fee Violations

A. Introduction to referrals of suspected violations

B. Procedure for FO development and referral of possible fee violations

1. Develop the possible fee violation as fully as possible

a. Review the claim(s)

b. Request proof of payment

c. Complete form SSA-5002 (Report of Contact (ROC))

d. Obtain copies of all documents and notices

e. Obtain signed statements, if available

f. Documenting the claimant-representative relationship

2. Request management review

3. Referral after management review is complete

C. Procedure for PC development and referral of possible fee violations

1. Develop the possible fee violation as fully as possible

2. Request management review if local office instructions require it

3. Management review is complete

D. Procedure for FO development and referral of possible non-fee violations of the Rules of Conduct and Standards of Responsibility for Representatives

1. Develop and refer non-fee violations

2. Management review

3. Management review is complete

E. Procedure for PC development and referral of non-fee violations of the Rules of Conduct and Standards of Responsibility for Representatives

1. Develop and refer non-fee violations

2. Request management review if local office instructions require it

3. Management review is complete

F. Referring possible violations of the requirement to use our electronic services

1. iAppeals requirement

2. iAppeals requirement referral procedure

3. iAppeals requirement sample warning letter

GN 03970.020 Evaluation and Action on Field Office (FO) and Processing Center (PC) Referrals

A. Introduction to Center for Programs Support (CPS) and Operations Support Branch (OSB) referrals

B. CPS and OSB procedure for possible fee and non-fee violations

1. Determine the type of possible violation

2. Referring the matter to the Office of the General Counsel (OGC)

GN 03970.025 Field Office (FO) and Processing Center (PC) Action on Direct Payment Error Fee Violations

A. Introduction to FO and PC actions on direct payment errors and possible fee violations

B. Procedure for FO and PC development of direct payment errors and possible fee violations

C. Procedure for FO and PC notice preparation and control

1. Sample notices for duplicate payment

2. Sample notices for excess payment

3. Sample notices for unauthorized fee