[Code of Federal Regulations]
[Title 31, Volume 2]
[Revised as of July 1, 2007]
From the U.S. Government Printing Office via GPO Access
[CITE: 31CFR240.15]

[Page 92-93]
 
                  TITLE 31--MONEY AND FINANCE: TREASURY
 
         CHAPTER II--FISCAL SERVICE, DEPARTMENT OF THE TREASURY
 
PART 240_INDORSEMENT AND PAYMENT OF CHECKS DRAWN ON THE UNITED STATES 
 
Sec.  240.15  Checks issued to deceased payees.

    (a) Handling of checks when an executor or administrator has been 
appointed. (1) An executor or administrator of an

[[Page 93]]

estate that has been appointed in accordance with applicable State law 
may indorse checks issued for the following classes of payments the 
right to which under law does not terminate with the death of the payee: 
payments for the redemption of currencies or for principal and/or 
interest on U.S. securities; payments for tax refunds; and payments for 
goods and services.
    (i) An executor or administrator indorsing any such check must 
include, as part of the indorsement, an indication of the capacity in 
which the executor or administrator is indorsing. An example would be: 
``John Jones by Mary Jones, executor of the estate of John Jones.''
    (ii) When a check indorsed in this fashion is presented for payment 
by a financial institution, it will be paid by Treasury without the 
submission of documentary proof of the authority of the executor or 
administrator, with the understanding that evidence of such claimed 
authority to indorse may be required by Treasury in the event of a 
dispute.
    (2) An executor or administrator of an estate may not indorse a 
check issued for any class of payment other than one specified in 
paragraph (a)(1) of this section. Other checks, such as recurring 
benefit payments and annuity payments, may not be negotiated after the 
death of the payee. Such checks must be returned to the certifying 
agency for determination as to whether, under applicable law, payment is 
due and to whom it may be made.
    (b) Handling of checks when an executor or administrator has not 
been appointed. If an executor or administrator has not been appointed, 
all checks issued to a deceased payee must be returned to the certifying 
agency for determination as to whether, under applicable law, payment is 
due and to whom it may be made.
    (c) Handling of checks when a certifying agency learns, after the 
issuance of a recurring benefit payment check, that the payee died prior 
to the date of issuance. (1) A recurring benefit payment check, issued 
after a payee's death, is not payable. As a consequence, when a 
certifying agency learns that a payee has died, the certifying agency 
must give immediate notice to Treasury, as prescribed at Volume I, Part 
4, Chapter 7000 of the Treasury Financial Manual, which can be found at 
http://www.fms.treas.gov. Upon receipt of such notice from a certifying 
agency, Treasury will instruct the Federal Reserve Bank to refuse 
payment of the check upon presentment. Upon receipt of such instruction 
from Treasury, the Federal Reserve Bank will make every appropriate 
effort to intercept the check. If the check is successfully intercepted, 
the Federal Reserve Bank will refuse payment, and will return the check 
unpaid to the presenting bank with an annotation that the payee is 
deceased. If a financial institution learns that a date of death 
triggering action under this section is erroneous, the financial 
institution must advise the payee to contact the payment certifying 
agency.
    (2) Nothing in this section shall limit the right of Treasury to 
institute reclamation proceedings under the provisions of Sec. Sec.  
240.8 and 240.9 with respect to a check issued to a deceased payee that 
has been negotiated and paid over a forged or unauthorized indorsement.