[Code of Federal Regulations]

[Title 20, Volume 1]

[Revised as of April 1, 2005]

From the U.S. Government Printing Office via GPO Access

[CITE: 20CFR255.11]



[Page 503-504]

 

                      TITLE 20--EMPLOYEES' BENEFITS

 

                  CHAPTER II--RAILROAD RETIREMENT BOARD

 

PART 255_RECOVERY OF OVERPAYMENTS--Table of Contents

 

Sec.  255.11  Fault.



    (a) Before recovery of an overpayment may be waived, it must be 

determined that the overpaid individual was without fault in causing the 

overpayment. If recovery is sought from other than the overpaid 

individual but the overpaid individual was not without fault, then 

waiver is not available. However, see Sec.  255.16 of this part for 

provisions as to when administrative relief from recovery may be granted 

in such circumstances.

    (b) Fault means a defect of judgment or conduct arising from 

inattention or bad faith. Judgment or conduct is defective when it 

deviates from a standard of reasonable care taken to comply with the 

entitlement provisions of this chapter. Conduct includes both action and 

inaction. Unlike fraud, fault does not require a deliberate intent to 

deceive.

    (c) Whether an individual is at fault in causing an overpayment 

generally depends on all circumstances surrounding the overpayment. 

Among the factors the Board will consider are: the ability of the 

overpaid individual to understand the reporting requirements of the 

Railroad Retirement Act or to realize that he or she is being overpaid 

(e.g., age, education, comprehension, physical and mental condition); 

the particular cause of non-entitlement to benefits; and the number of 

instances in which the individual may have made erroneous statements.

    (d)(1) Circumstances in which the Board will find an individual at 

fault include but are not limited to:

    (i) Failure to furnish to the Railroad Retirement Board information 

which the individual knew or should have known to be material;

    (ii) An incorrect statement made by the individual which he or she 

knew or should have known was incorrect (including furnishing an opinion 

or conclusion when asked for facts); and

    (iii) Failure to return a payment which the individual knew or 

should have known was incorrect.

    (2) Where any of the circumstances listed in paragraph (d)(1) are 

found to have occurred, the individual shall be presumed to be not 

without fault. This presumption may be rebutted, but the burden of 

presenting evidence to rebut the presumption is on the individual.

    (3) For purposes of paragraph (d)(1)(i), furnishing information to 

the Social Security Administration or any other agency shall not be 

considered to constitute furnishing information to the Railroad 

Retirement Board.

    (4) For purposes of this section, an error on the part of the agency 

shall not extinguish fault on the part of the individual.

    (e) Circumstances in which the Board will find an individual not at 

fault include but are not limited to:

    (1) The overpayment is the result of Board error of which the 

overpaid individual was not aware and could not reasonably have been 

expected to be aware (Example 1 of this section).

    (2) The overpayment is the result of an adjustment to the overpaid 

individual's annuity because of entitlement of another individual to an 

annuity on the same record of compensation as that of the overpaid 

individual (Example 2 of this section).

    (3) The overpayment is the result of the Board's continuing to pay 

an individual after he or she has notified the Board of an event which 

caused or should have caused a reduction in his or her benefit; provided 

that continued payment of the unreduced benefit led the individual to 

believe in good faith that he or she was entitled to the payments 

subsequently received.



[[Page 504]]



    (f) The application of this section may be illustrated by the 

following examples:



    Example (1). The Board makes a mathematical error in the computation 

of an employee's annuity, thus giving the employee a higher rate than he 

or she is entitled to but which is sufficiently close to the estimated 

rate given the employee at the time he or she applied for the annuity 

that the employee believed, in good faith, that the amount was correct. 

The employee is not at fault in causing the overpayment in this case. 

The overpayment may be waived if the requirements of Sec.  255.12 or 

Sec.  255.13 of this part are met.

    Example (2). The widow and four minor children of a railroad 

employee are receiving benefits from the Board under the family maximum. 

Another minor child not living in the same household as the above 

individuals is also determined to be the child of the deceased employee. 

The widow was not aware of the existence of this child. An award of 

benefits to this child causes a reduction in benefits to the other 

individuals under the family maximum benefit provision of the Social 

Security Act. Because of normal administrative delay this reduction does 

not take place for a period of 2 months after its effective date. The 

widow and her children are without fault with respect to this 

overpayment. The overpayment may be waived if the requirements of Sec.  

255.12 or Sec.  255.13 of this part are met.