20 C.F.R. § 404.2041

Who is liable if your representative payee misuses your benefits?

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(a) A representative payee who misuses your benefits is responsible for paying back misused benefits. We will make every reasonable effort to obtain restitution of misused benefits so that we can repay these benefits to you.

(b) Whether or not we have obtained restitution from the misuser, we will repay benefits in cases when we determine that a representative payee misused benefits and the representative payee is an organization or an individual payee serving 15 or more beneficiaries. When we make restitution, we will pay you or your alternative representative payee an amount equal to the misused benefits less any amount we collected from the misuser and repaid to you.

(c) Whether or not we have obtained restitution from the misuser, we will repay benefits in cases when we determine that an individual representative payee serving 14 or fewer beneficiaries misused benefits and our negligent failure in the investigation or monitoring of that representative payee results in the misuse. When we make restitution, we will pay you or your alternative representative payee an amount equal to the misused benefits less any amount we collected from the misuser and repaid to you.

(d) The term “negligent failure” used in this subpart means that we failed to investigate or monitor a representative payee or that we did investigate or monitor a representative payee but did not follow established procedures in our investigation or monitoring. Examples of our negligent failure include, but are not limited to, the following:

(1) We did not follow our established procedures in this subpart when investigating, appointing, or monitoring a representative payee;

(2) We did not timely investigate a reported allegation of misuse; or

(3) We did not take the necessary steps to prevent the issuance of payments to the representative payee after it was determined that the payee misused benefits.

(e) Our repayment of misused benefits under these provisions does not alter the representative payee's liability and responsibility as described in paragraph (a) of this section.

(f) Any amounts that the representative payee misuses and does not refund will be treated as an overpayment to that representative payee. See subpart F of this part.

[69 FR 60234, Oct. 7, 2004, as amended at 71 FR 61408, Oct. 18, 2006]

Notes of Decisions

Cited in 26 cases (4 in the last 5 years), 1984–2025 · leading case: LaMothe v. LeBlanc

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LaMothe v. LeBlanc (2013) vt · cites it 4× “The regulations provide that “[a] representative payee who misuses [derivative] benefits is responsible for paying back misused benefits,” 20 C.F.R. § 404.2041 (a), thereby “implicitly allowing for a claim by the beneficiary against the payee.”

In Re Estate of Merritt (1995) illappct “at 218 ; 20 C.F.R. §§ 404.2041 , 404.2050 (1993).) Federal law provides a remedy when a payee abuses his or her fiduciary duty.”

Grace Thru Faith v. Caldwell (1996) tennctapp “20 C.F.R. § 404.2041 (1996). The Act further provides for the revocation of a representative payee’s certification when “the Commissioner of Social Security or a court of competent jurisdiction determines that a representative payee has misused any individual’s benefit paid” to…”

Y.H. v. M.H. (2018) calctapp5d “" ( 20 C.F.R. § 404.2041 , subd. (a).) Moreover, under the anti-attachment provision, "none of the moneys paid .”

In re Ryan W. (2013) md “See 20 C.F.R. § 404.2041 (a). Therefore, unlike the cases relied on by the COSA in Ecolono, see, e.”

Woodall v. Bartolino (1985) njd · cites it 2× “20 C.F.R. §§ 404.2041 , 404.-2050. *219 In accordance with 20 C.”

Ruby Oliver v. James G. Ledbetter (1987) ca11 “2035 (1986) provides in relevant part: A representative payee has a responsibility to— (a) Use the payments he or she receives only for the use and benefit of the beneficiary in a manner and for the purposes he or she determines, under the guidelines in this sub-part, to be in…”

Elam v. Barry (1986) ohsd · cites it 2× “20 C.F.R. § 404.2041 ; 42 U.S.C. §§ 402 (d), 407 and 408(e).”

In re Marriage of Stephenson & Papineau (2015) kan “” 20 C.F.R. § 404.2041 (a) (2015). As a package, these provisions severely limit the ability to redirect the use of the derivative benefit to reimburse a child-support obligor.”

Bradley v. Austin (1988) ca6 “1987); see also 20 C.F.R. § 404.2041 (1987). DEFRA made several changes in the AFDC program, including one involving the composition of a filing unit for AFDC assistance.”

Holt v. Bowen (1989) cod “20 C.F.R. § 404.2041 . Defendant asserts that correct payment was made to Stewart, and that proper procedure was followed in allowing him to become Plaintiff’s designated payee.”

Briggs v. Sullivan (1992) ca9 “20 C.F.R. §§ 404.2041 and 416.641 provide that the Secretary’s “obligation to the beneficiary is completely discharged when [he] make[s] a correct payment to a representative payee on behalf of the beneficiary.”

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