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Comp Blog

Q&A: Notice of Reclamation

By: Danielle Wright

CommentWednesday - April 30, 2014

Q:  We just received a Notice of Reclamation from the federal government to collect post-death benefit payments paid to a deceased member.  What is our liability if the money is no longer in the account?

A:  According to Treasury’s regulations, a receiving depository financial institution (RDFI) is liable for ALL benefit payments received after the death of a recipient, unless the RDFI meets the following qualifications:

  • Certifies that it did not have actual or constructive knowledge of the recipient’s death or incapacity at the time of the deposit of any post-death benefit payments;
  • Returns all post-death benefit payments it receives after it learns of the death; and
  • Responds to the Notice of Reclamation completely and adequately, so that it is received by the Government Disbursing Office within 60 days from the date of the notice.

Upon receiving the Notice of Reclamation, you should immediately determine the account balance.  If there are insufficient funds, a partial payment should be remitted to the Government Disbursing Office that issued the reclamation.  When returning less than the full amount, you should remit a check and attach the front and back copy of the Notice indicating on the reverse the total amount of the partial payment.

Treasury notes that “if at the time the RDFI first receives information of death, all or part of the post-death benefit payments have already been withdrawn from the account, the government does not authorize the RDFI to try to recover the funds from the withdrawer.  If the RDFI does so, it acts under its own authority in terms of its contract with its depositor or under state law.”

For more information see Treasury’s Guide to Federal Government ACH Payments    






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