Identification Number:
GN 02408 TN 43
Intended Audience:See Transmittal Sheet
Originating Office:DCBFM OFPO
Title:Stop Payments and Reclamations
Type:POMS Transmittals
Program:All Programs
Link To Reference:
 

PROGRAM OPERATIONS MANUAL SYSTEM
Part GN – General
Chapter 024 – Checks
Subchapter 08 – Stop Payments and Reclamations
Transmittal No. 43, 11/10/2020

Audience

PSC: BA, CCRE, CS, DS, IES, ILPDS, IPDS, PETE, RECONR, SCPS, TSA, TST;
OCO-OEIO: BIES, BTE, CCRE, CR, FCR, PETL, RECOVR;
OCO-ODO: BTE, CCE, CR, CST, CTE, CTE TE, DSE, PAS, PETE, PETL, RCOVTA, RECOVR;
FO/TSC: CS, CS TII, CS TXVI, CSR, CTE, FR, OA, OS, RR, TA, TSC-CSR;

Originating Component

OFPO

Effective Date

Upon Receipt

Background

Per instructions from the Office of Benefit Accounting and Systems Analysis (OBASA), the name of the Division of Benefit Certification and Accounting (DBCA) has been updated to read Division of Benefit Certification and Systems Analysis (DBCSA). The email address has been updated to read OBASA.TOB@ssa.gov.

 

Summary of Changes

GN 02408.630 SSA Contacts Last Withdrawers

Subsection C, Email address already updated.

 

GN 02408.645 Debiting the FI’s Account for EFT Reclamations

Subsection C, We replaced the Division of Benefit Certification and Accounting (DBCA) name to read Division of Benefit Certification and Systems Analysis (DBCSA).

 

GN 02408.665 Financial Institution (FI) Returns Incorrect Payments to SSA

Subsection B, We replaced the Division of Benefit Certification and Accounting (DBCA) name to read Division of Benefit Certification and Systems Analysis (DBCSA).

 

GN 02408.720 Dual Recovery

Subsection E, We replaced the Division of Benefit Certification and Accounting (DBCA) name to read Division of Benefit Certification and Systems Analysis (DBCSA) and updated the fax number.

GN 02408.630 SSA Contacts Last Withdrawers

A. Background on last withdrawers

Federal regulations under 31 CFR 210.11(b)(3)(i) clarify the reporting requirements for financial institutions (FIs) in the automated reclamation process. In order to qualify for limited liability, an FI must report the name, last known address, and phone number of any person who have withdrawn, or had authorization to withdraw funds subject to reclamations. We must attempt to contact the last withdrawers to request a refund of any funds due the agency.

B. Process for Title II last withdrawers

The Title II process is as follows:

  1. 1. 

    Treasury uploads the Form FMS-133 (Notice of Reclamation (NOR)) via fax into our paperless repository. Technicians in the processing center (PC) of jurisdiction will review the NOR and code the SSA-4208 (Reclamation Data Input Form) for any funds recovered, and mails a notice (the E3595 or overpayment notice) to the last withdrawer requesting repayment of any outstanding funds withdrawn from the account. For instructions on how to code the SSA-4208 or process the FMS-133 NOR, see SM 00609.855 and GN 02408.626B.2.

  2. 2. 

    To determine which notice to mail:

    • If the payment after death is not an overpayment per GN 02201.001E through GN 02201.001F and GN 02205.003C.3., see the E3595 notice information on recovery from an individual who withdrew funds from a deceased beneficiary’s bank account after death in NL 00703.595.

    • If the individual is receiving benefits, and the payment after death is an overpayment per GN 02201.001B.2., see the information on notification of a Title II overpayment in GN 02201.009.

  3. 3. 

    Upon release of the E3595 or overpayment notice, prepare a 45-day diary for returning the funds.

  4. 4. 

    If the last withdrawer refunds part of the money, the PC notifies Treasury of the amount collected and codes the SSA-4208 for the refunded amount. If an individual refunds an improper Electronic Funds Transfer (EFT) Payment, see GN 02408.670. Any funds still outstanding and still due to SSA are debited from the FI’s federal reserve account via the FMS-135 (Request for Debit of the FI’s Account). See GN 02408.626B.2.

  5. 5. 

    If the last withdrawer refunds all of the money, the PC codes the SSA-4208 for the refunded amount. See also information on when an individual refunds an improper EFT payment in GN 02408.670.

  6. 6. 

    If the last withdrawer does not respond within 45 days, complete and return the FMS-133 to Treasury. Be sure to stamp “RECLAIM” in the top-middle portion of the FMS-133. Treasury debits the FI’s federal reserve account and returns an FMS-135 to SSA when the debit is completed.

  7. 7. 

    It is important for the PC to let Treasury know of the additional amount collected, in order to avoid collecting funds twice. See the instructions on dual recovery in GN 02408.720.

NOTE: Do not use Manual Adjustment Credit and Award Process (MADCAP) or Recovery of Overpayments, Accounting and Reporting (ROAR) to reduce or clear the special payment amount (SPA) or beneficiary overpayment or underpayment data (BOUD) because they do not post the credit to the appropriate payment and do not clear the Accounts Receivable System (ARS).

C. Process for Title XVI last withdrawers

The Title XVI process is as follows:

  1. 1. 

    Treasury uploads the FMS-133 NOR form into the Treasury Check Information System (TCIS) for an electronic copy to be available for retrieval by the Office of Benefit Accounting and Systems Analysis (OBASA) Treasury Operations Branch (TOB) daily.

  2. 2. 

    OBASA will review the FMS-133 retrieved from TCIS and analyzes the Supplemental Security Record (SSR).

    • If the recipient is deceased and money is not due SSA, OBASA will process an abandonment of reclamation to stop recovery efforts.

    • If the recipient is alive or the NOR is invalid due to an incorrect date of death and money is not due SSA, OBASA will process an abandonment of reclamation to stop recovery efforts.

    • If the recipient is deceased and money is due SSA, OBASA will post any remitted funds returned on the FMS-133 NOR to the SSR, establish a 180-day diary, and email the FMS-133 NOR file to the field office (FO) of jurisdiction to contact the last withdrawer.

  3. 3. 

    After receiving the email from OBASA, FO technicians will mail either an e3595 or an overpayment notice to the last withdrawers to request repayment of any outstanding funds withdrawn from the account. For an example of the notice, refer to NL 00703.595.

  4. 4. 

    To determine which notice should be mailed:

    For an example of the notice if the payment after death is not an overpayment, see NL 00703.595.

    If the individual is receiving benefits, and the payment after death is an overpayment, see instructions on notifying individuals of Title XVI overpayments in SI 02220.010.

  5. 5. 

    Upon release of the E3595 or overpayment notice, the FO technicians will create a 45-day diary for return of funds.

    • If the last withdrawer returns only part of the funds owed within the 45 days, the FO technician will email OBASA at OBASA.TOB@ssa.gov with the amount collected and enter the remittance in the Debt Management System (DMS) if not already posted to the SSR. For information on the field office remittance input, see GN 02403.003 and MSOM DMS 003.006. Do not waive any outstanding overpayment/payment(s) after death. Treasury will debit any funds still outstanding and still due to SSA from the FI’s federal reserve account via the FMS-135.

    • If the last withdrawer refunds all the money, the FO technician will email OBASA at OBASA.TOB@ssa.gov with the amount collected and enter the remittance in DMS if not already posted on the SSR. For information on how to complete an SSA 3969-U2 (SSI Remittance Register), see OS 00515.020. See also the information on when an individual refunds an incorrect EFT payment in GN 02408.670. Once the payment posts to the Overpayment Refund Data (OPRR) field of the SSR, the FO must request abandonment of reclamation from Treasury via SSA-1714 (Abandon Reclamation Request); see GN 02408.800.

    • If the last withdrawer does not refund any money owed within 45 days, the FO should take no additional action. After the 180-day OBASA diary matures, OBASA will complete the FMS-133 NOR, stamp “RECLAIM” in the top-middle portion of the form, and forward the completed form to Treasury.

  6. 6. 

    If any funds are still due, Treasury processes the FMS-133 NOR and debits the 45-day limited liability amount from the FI’s federal reserve account, returning the credit to OBASA via an FMS-135.

  7. 7. 

    OBASA will post any additional money collected on the FMS-135 to the SSR.

  8. 8. 

    OBASA will review DMS and the SSR for any credits posted to avoid collecting funds twice.

NOTE: It is important for FO technicians to inform OBASA of any additional amounts collected in order to avoid collecting the funds twice. See information on dual recovery in GN 02408.720.

D. References

  • GN 02201.001 What is a Title II Overpayment

  • GN 02201.009 Notification of a Title II Overpayment

  • GN 02210.221 How to Process Death Cases – DCR/DS Actions

  • GN 02403.003 The Field Office Remittance Input

  • GN 02408.626 Processing the Notice of Reclamation (FMS-133) and the Request for Debit of the FI’s Account (FMS-135) for Title II EFT Payments

  • GN 02408.670 Incorrect EFT Payment is Refunded by an Individual

  • GN 02408.720 Dual Recovery

  • NL 00703.595 Recovery From Individual Who Withdrew Funds From a Deceased Beneficiary’s Bank Account After Death

  • OS 00515.020 How to Complete an SSA-3969-U2, SSI Remittance Register

  • MSOM DMS 003.006 Field Office Remittance Input (RFOR)

  • SM 00609.855 How to Complete Form SSA-4208 for FALCON Transactions – General

GN 02408.645 Debiting the FI’s Account for EFT Reclamations

Effective January 2, 2008, the Department of the Treasury (DT) imposed a three (3) year time limit for Federal agencies to submit final debits (i.e., ACH reclaims) of a Financial Institution's (FI) Federal Reserve account via the FMS-135, Request for Debit. An ACH reclaim represents a debit against an FI for certain liability on payments disbursed after the death of a beneficiary. Agencies have three years from the date of the FMS-133, Notice of Reclamation to submit ACH reclaims via the FMS-135 to DT's Philadelphia, Kansas City and San Francisco Regional Financial Centers. Items older than three years are rejected and not processed.

A. Process when determining the amount to be debited

DT determines the amount to be debited from the FI's reserve account at the Federal Reserve Bank (FRB).

1. FI has returned full amount of incorrect payments

When the FI has returned the full amount of the incorrect payments issued after death, DT closes the case and does not instruct FRB to debit any funds from the FI’s reserve account.

2. FI has limited its liability

When the FI has limited its liability but has not returned the full amount of all outstanding payments, DT does the following:

  • Totals the amount already paid by the FI or survivors;

  • Title II only – Passes to SSA the name and address of the last withdrawers, so we can attempt to collect as much as possible of the outstanding total;

  • Adds the amount SSA has collected from the withdrawers to the total amount returned by the FI;

  • Subtracts the combined total from the amount of the FI’s liability; and

  • Computes the remainder as the amount to be debited.

3. FI has not limited its liability

When the FI has neither returned all incorrect payments nor limited its liability, the amount to be debited from the FI’s reserve account at FRB is the outstanding total as shown on the Notice of Reclamation.

B. Process when FRB debits the FI’s account

After determining the amount to be debited, DT sends a Request for Debit (FMS-135) to the FI’s servicing Federal Reserve Bank (FRB). FRB does the following:

  • Takes the money from the FI’s reserve account (or its correspondent’s reserve account) at FRB;

  • Notifies the FI of the action; and

  • Returns the reclaimed funds to DT.

C. Process when DT returns the funds to SSA

DT returns the funds to SSA, unless they receive a protest from the FI that needs investigation. DT forwards the FMS-135 to SSA for action.

1. Title II

The funds are automatically posted to the Payment History Update System (PHUS) and reduce the Special Payment Amount (SPA) on the PHUS and the Master Beneficiary Record (MBR). If posting does not take place, a reject goes to the PC. The PC must then resolve the reject and key the return using the SSA-4208. For SSA-4208 processing instructions, see GN 02408.626C and SM 00609.865.

2. Title XVI

The funds are automatically posted. DT sends the Division of Benefit Certification and Systems Analysis (DBCSA) an FMS-135 to notify SSA of the reclamation. If the funds have not posted, DBCA codes a 3969 and gives it to ODIO for input. The information posts to the SSR OPRR field as a refund or an S posts to Payflag 3 for the check in PMTH.

GN 02408.665 Financial Institution (FI) Returns Incorrect Payments to SSA

A. Introduction

When an FI returns an improper SSA payment after death to the Department of the Treasury (DT), DT passes the payment to SSA.

B. Process for Title XVI

1. Treasury Status Query (UPTQ) does not reflect return

When an FI returns a payment in response to a Title XVI reclamation, UPTQ may or may not reflect the return, depending on how the return was processed by DT. However, the return is posted to the Supplemental Security Income Record (SSR) in either PMTH or OPRR. For Treasury Status Query information, see MSOM BUSSR 003.020.

2. Division of Benefit Certification and Systems Analysis (DBCSA) action

The returned funds are not automatically posted to the SSR. DT sends an FMS-133 to DBCSA in Central Office. DBCSA codes a 3969 and sends it to the Office of Disability and International Operations (ODIO) for keying. When the return is not applied to the record in a timely manner, another attempt may be made to reclaim the money, resulting in dual recovery.

3. SSR shows returned funds

When a Title XVI payment after death is returned and posted, the amount of the returned funds is shown either in the OPRR (overpayment refund) TR1 field on the SSR as a “TU” or “TB” or in payflag 1 of PMTH as a

  • slash (/) (recurring payment returned by Treasury only),

  • S (regular daily payment [underpayment] returned by FO only),

  • T (special supplemental payment returned by Treasury only), or

  • U (OTP returned by Treasury only).

For additional codes, see SM 01601.835.

C. Process for Title II

When a Title II payment after death is returned through DT, the information is usually automatically posted to the Payment History Update System/Master Beneficiary Record (PHUS/MBR). The following changes are shown on the beneficiary’s record:

  • EVENT 009 RET CHECK is posted to PHUS, showing the payment date, amount, and date of return.

  • The BSPA on the MBR and PHUS is reduced by the amount of the payment.

When a returned payment recovers an incorrect payment, notify DT to abandon reclamation if the FMS-133/135 is not received.

Input an SSA-4208 to update the Accounts Receivable System (ARS) with the amount of the refund.

When the returned payment does not automatically post, an exception is sent to the PC. The PC makes a manual input to post the return. When the payment is not posted promptly, it is possible for another reclamation request to be sent, causing a dual recovery.

D. References

GN 02408.720 - Dual Recovery

SM 01315.142 - How to Handle a Dual Recovery/Erroneous Reclamation (Title XVI)

GN 02408.720 Dual Recovery

A. Introduction

This section applies to dual recovery of any incorrect electronic funds transfer (EFT) benefit payments from SSA, including Title XVI, Title VIII, and Title II.

B. Description

A dual recovery occurs when SSA receives the funds for the same incorrect payment(s) twice. This can happen by any combination of two of the following events, including two of the same event. This is especially likely when there is a delay in posting a return. The events are:

  • A reclamation is done through the financial institution (FI), and the money is returned electronically.

  • The FI returns the payment(s) by check or EFT after learning of the death.

  • A joint account holder, executor, or family member returns the payment(s) by check, money order, or cash.

  • The person who withdrew the funds repays by check, money order, or cash.

  • The amount of the incorrect payment is subtracted from money owed to the survivor(s), including the LSDP, payment due for past months, the difference between life and survivor beneficiary amounts, or the difference due because there are fewer recipients/beneficiaries on the record after the death.

  • The money is recovered from ongoing benefits of a survivor or the person who withdrew the money from the beneficiary’s account.

C. Examples of dual recovery

1. Example 1

On July 15, 2008, Bank Three received a death notification entry (DNE) for Mr. Supplement, who died on May 25, 2008.

On July 29, 2008, the FI returned the two incorrect payments after his death.

On July 30, 2008, his executor, who had not yet received the FI’s notice of this action, sent a check for the amount to SSA.

Because we received the funds twice, this was a dual recovery.

2. Example 2

On August 1, 2008, Bank Four returned a payment of $1240 paid after death to the account of Ms. Em, who died on July 26, 2008.

Unfortunately, the returned payment did not post to the Payment History Update System (PHUS), so an automated reclamation request was sent on August 15, 2008.

A new employee at Bank Four returned the payment for the second time, without checking to see if it had already gone back to SSA.

Because SSA received the funds twice, this was a dual recovery.

3. Example 3

The widow returned the payment after death by a bank cashier’s check, but the remittance was not processed to the record in time to prevent a reclamation from going out.

The FI contacted the executor of the estate, who returned the funds to SSA by a check drawn on the estate.

Because we received the funds twice, this was a dual recovery.

4. Example 4

The FI inadvertently returns the payment prior to the month of death instead of the actual month of death payment. The bank is unaware that they returned the wrong payment and Treasury has debited the bank’s Federal Reserve account. The FI then contacts SSA requesting a refund for the amount debited, since they did return the payment, just the incorrect one. Because we received the funds twice, this was a dual recovery.

D. Policy

When incorrect payments made after death are returned twice to SSA, the field office or processing center (FO/PC) returns any funds above the correct amount to the party that suffered the loss.

E. Procedure when dual recovery is alleged

1. Gather the evidence

Get statements and any evidence available:

  1. a. 

    When a check or money order was involved, ask the sender to obtain a copy of both sides of the item.

  2. b. 

    When someone brought cash to an FO, request a copy of the receipt.

  3. c. 

    Check the applicable system for evidence of returns.

  4. d. 

    Ask the PC to look for evidence that the money came from the FI through the Department of the Treasury (DT) but it rejected or edited and was not entered on the system.

  5. e. 

    Compare the amount due survivors with the amount paid, to determine whether money was repaid to SSA by being subtracted from the amount due the survivors.

  6. f. 

    Check the record for anyone who alleges SSA recovered the funds from his/her ongoing benefits.

2. Determine who suffered the loss

When dual recovery has occurred, look at the evidence to determine which party suffered the loss. Consider that the money should come from the beneficiary’s account when it is available in the account. If the FI returned the money from the account, the FI is not the party you should repay. Consider that, when the money was reclaimed from the FI’s reserve account at the Federal Reserve Bank (FRB), the FI suffered a loss. The following lists some examples of situations you may encounter:

  1. a. 

    When the same party returned the money twice, this is the correct party to repay.

  2. b. 

    When the FI took the funds from the beneficiary’s account and the joint account holder also repaid SSA, the joint account holder is the one SSA must repay. (The FI has not suffered any loss.)

  3. c. 

    When the FI returned the funds from the beneficiary’s account and a family member or the estate executor also repaid SSA, the family member or estate executor is the one SSA must repay. (The FI has not suffered any loss.)

  4. d. 

    When the money was reclaimed from the FI when the money was not in the beneficiary’s account, and the estate or a family member also repaid the funds, SSA should repay the FI. (The FI has suffered a loss.)

  5. e. 

    When the FI returned the funds from the beneficiary’s account and the money was also reclaimed from the FI’s account at Federal Reserve Bank, repay the FI. (The FI has suffered a loss.)

  6. f. 

    When the FI returned the funds from the beneficiary’s account and the money was also reclaimed from the beneficiary’s account, repay the joint account holder, if any (or the beneficiary’s estate, if there is no joint account holder). (The joint account holder or the estate has suffered a loss. The FI has not suffered a loss.)

3. Obtain the correct address

Once you have determined the correct party to repay, obtain the full address. When the FI is the party that has suffered a loss, ask for the exact address of the person at the FI who should receive the payment. Explain the format of the address, so the FI can decide how best to structure it to include the name of the correct bank official and any codes the FI may need for crediting the payment.

The address can have up to 6 lines of up to 22 characters each, including spaces. In addition to alpha and numeric characters, only a space or dash may be used on the check. As with any Treasury check, all letters are in capitals.

EXAMPLE:

BANK TEN
MARY OFFICIAL
LX529
3321 WEST W55TH ST
BALTIMORE MD 21244

4. Repay the correct party

a. Title XVI payment

Process the Title XVI payment as follows:

  • Prepare a memo requesting a Special Voucher Payment.

  • Include all the facts, an SSI query, and all documentation.

  • Include the name and complete address of the party to be repaid.

  • Include the name, telephone number, and fax number of the FO contact.

  • Make copies for the FO records.

  • Fax the material to:

    •  

      Division of Benefit Certification and Systems Analysis (DBCSA)

    •  

      Electronic fax 833-955-2293.

  • Follow-up in six weeks if you do not receive a notification from DBCSA that the payment has been certified.

  • Annotate the Remarks segment of the Supplemental Security Income Record (SSR) to show that a Special Voucher was issued.

b. Title II payment – FO or Federal Benefits Unit (FBU) actions

Process the Title II as follows:

  • Gather all necessary information

    In the FO or consular office, when you discover a Dual Recovery situation, gather all the information necessary to complete a Single Payment System (SPS) input. (See SPS Processing of the Miscellaneous Payment Screen SM 00834.435.)

    For instructions on gathering the evidence, follow GN 02408.720E.1. and for determining who should receive the payment, follow GN 02408.720E.2.

    To obtain and format the address, see GN 02408.720E.3. in this section.

  • Send a request to the servicing PC

    Send a request, with all necessary information, to the servicing PC. Do this by faxing the information to Paperless or completing a Modernized Development Worksheet (MDW).

  • Determine whether payment processed successfully

    To find out whether the payment processed successfully, query the PHUS for all payments, not the BIC of the deceased person. There should be a record under the BIC of VB or VO. When it has not processed successfully in 45 days, notify the PC.

c. PC actions for Title II payments

  • In the PC, review the information provided by the FO/FBU to be sure it is complete for input. To make sure the address is complete and formatted correctly, follow GN 02408.720E.3.

  • Input the payment to the Special Payment System (SPS). (See SPS Processing of the Miscellaneous Payment Screen SM 00834.435.)

  • Notify the requesting office when the payment has been sent.

F. References

  • SM 01315.143 - How to request a Special Voucher Payment for Title XVI

  • SM 00834.435 - Processing of the Miscellaneous Payment (MPAY) Screen for Title II


GN 02408 TN 43 - Stop Payments and Reclamations - 11/10/2020