[Code of Federal Regulations]
[Title 31, Volume 2]
[Revised as of July 1, 2002]
From the U.S. Government Printing Office via GPO Access
[CITE: 31CFR210.10]

[Page 56-57]
 
                  TITLE 31--MONEY AND FINANCE: TREASURY
 
         CHAPTER II--FISCAL SERVICE, DEPARTMENT OF THE TREASURY
 
PART 210--FEDERAL GOVERNMENT PARTICIPATION IN THE AUTOMATED CLEARING HOUSE--Table of Contents
 
               Subpart B--Reclamation of Benefit Payments
 
Sec. 210.10  RDFI liability.

    (a) Full liability. An RDFI shall be liable to the Federal 
Government for the total amount of all benefit payments received after 
the death or legal incapacity of a recipient or the death of a 
beneficiary unless the RDFI has the right to limit its liability under 
Sec. 210.11 of this part. An RDFI shall return any benefit payments 
received after the RDFI learns of the death or legal incapacity of a 
recipient or the death of a beneficiary, regardless of the manner in 
which the RDFI discovers such information. If the RDFI learns of the 
death or legal incapacity of a recipient or death of a beneficiary from 
a source other than notice from the agency, the RDFI shall immediately 
notify the agency of the death or incapacity.
    (b) Notice of reclamation. Upon receipt of a notice of reclamation, 
an RDFI shall provide the information required by the notice of 
reclamation and return the amount specified in the notice of reclamation 
in a timely manner.
    (c) Exception to liability rule. An RDFI shall not be liable for 
post-death benefit payments sent to a recipient acting as a 
representative payee or fiduciary on behalf of a beneficiary, if the 
beneficiary was deceased at the time the authorization was executed and 
the RDFI did not have actual or constructive knowledge of the death of 
the beneficiary.
    (d) Time limits. An agency that initiates a reclamation must do so 
within 120 calendar days after the date that the agency receives notice 
of the death or legal incapacity of a recipient or death of a 
beneficiary. An agency shall not reclaim any post-death or post-
incapacity payment(s) made more than six years prior to the most recent 
payment made by the agency to the recipient's account; provided, 
however, that if the account balance at the time the RDFI receives the 
notice of reclamation exceeds the total amount of all post-death or 
post-incapacity payments made by the agency during such six-year period, 
this limitation shall not apply and the RDFI shall be liable for the 
total amount of all payments made, up to the amount in the account at 
the time the RDFI receives the notice of reclamation and has had a 
reasonable opportunity (not to exceed one business day) to act on the 
notice.
    (e) Debit of RDFI's account. If an RDFI does not return the full 
amount of the outstanding total or any other amount for which the RDFI 
is liable under this subpart in a timely manner, the Federal Government 
will collect the amount outstanding by instructing the appropriate 
Federal Reserve Bank to debit the account utilized by the RDFI. The 
Federal Reserve Bank will

[[Page 57]]

provide advice of the debit to the RDFI.