On November 4 my firm received a Title XVI fee by direct deposit. On November 22, Social Security reached back into our bank account and took the money back without any prior notice. We've received no written notice from Social Security about this event.
Fee overpayments happen from time to time. Typically, we get a notice to return the money. We do. In fact, we’ve generally returned the money even before receiving a notice. I've never seen Social Security just grab the money. Has anyone else seen this? Can they do this?
12 comments:
Can they? Well, they did already.
Should they? POMS GN 02408.301 reclamations does not cover attorney fees.
The reclamation here was not appropriate under GN 03970.025. The request should always be made in writing if the fee payment was not due.
Since SSI fees are paid several weeks to months after the award is processed, this was probably someone who wanted to correct this and had never handled an improper fee before (if this was improper).
Check to see if you received a notice tied to this fee. Just my 2 cents on this.
Odd. We've rarely had fee overpayments as well, and only objected in one instance as I recall. It can happen if a subsequent claim is awarded quickly on a title, when the prior claim on the other title is pending at the AC. Also, if SSA assumes a 406(b) fee disbursement is actually a 406(a); that can confuse them. The former is a legitimate overpayment, the later is not.
In any event, POMS GN 03920.051 indicates informing the representative and claimant are pretty much required whenever there is an excess representative fee payment. Sounds like the payment center or field office skipped that step.
If this $ went into your trust account and not your operating account, and you already transferred it out of trust, that would certainly cause problems because treasury just took someone else's $.
The post noted that this was a payment for Title XVI. Title XVI payments, including Attorney Fees are handled by Field Offices and not the Payment Centers.
This is the type of thing that I would call the Field Office Management about. Calling Field Offices is a difficult proposition. You can call and leave messages and no one will return the call. After years of such frustration I called the Regional Public Relations office with a "public relations" problem. I told them that no one returns my calls. Within a day, someone in management from the offending office called me back and helped me with the problem. The caller also gave me a "Management Phone Number." When I have problems with Field Office Representatives I call the phone number, report my problem and it is usually taken care of. I do not call that number every time, only when the staff does not return my calls.
I think this matter requires a call to the Field Office Management. Primarily to point out that this matter was not handled properly.
That is odd. In the 10 years I've been doing this in private practice, I've only had two times that they said I was overpaid on my fee and requested a return. We never set up direct deposit for our fees, so they have to ask us to return it. One time, I knew that they had double paid us a small fee, and I returned it before they could ask.
I would certainly ask for an explanation. They are so slow sending anything, I'm surprised that they overpay anybody.
I have heard of this happening, and it's precisely the reason I refuse to accept direct deposit of fees. I will never give someone access to take money back out of my account without notice and permission. And I would feel REALLY uncomfortable doing that with a trust account (plus, it's probably improper to land fees into trust anyway - earned fees aren't allowed in a trust account).
The problem with this case is that the FO on Title XVI fees does not have the systems capability to reclaim a fee once it is paid. They can only send a letter via mail requesting that the erroneous fee be refunded. Then, if the rep does not comply, the case is referred elsewhere.
It sounds like this was a Treasury Department error as they definitely have the capability to reclaim a payment.
If you can determine the claimant involved from the deposit header, it would definitely be a case where you need to consult with the local FO management to find out what is going on.
I've heard of the IRS doing that to businesses with high tax debt, but never SSA! I'm assuming this wasn't something that would bankrupt or harm you, but it's definitely something that should be reported so that the error can be avoidable in the future, maybe retrain someone? I'd certainly make them aware of it, though!
Big Brother has its tentacles. Sounds like stop using direct deposit.
FOs can certainly dispense T16 money. They absolutely cannot reclaim it (for obvious reasons, although some of these payee changes would be tempting). I don't think even the PC has the option to do so. Treasury has the capability, and usually does so if the claimant passes away before the payment (even if the payment was proper).
Did your claimant die?
Remember it's not really direct deposit, it's electronic fund transfer and electricity runs in both directions.
Did you have to sign an agreement to use direct deposit? If so, you're answer may lie in the terms of service you agreed to.
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