TN 35 (02-09)

A. Introduction to court-ordered restitution of SSI overpayments

This section implements policy and procedures for the processing of court-ordered restitution of Supplemental Security Income (SSI) overpayments to the agency. Court- ordered restitution is the end result of a process that begins when a Field Office (FO) has a suspicion that a SSI overpayment was the result of fraud, and referred the case to the Office of the Inspector General (OIG). This section focuses on the agency’s actions, following a court order to the overpaid individual, to repay overpaid monies to the agency. It does not contain all the procedures in fraud referral, or the procedures following OIG acceptance of a referral. The policies and procedures for court-ordered restitution cases are basically the same for both Title II and Title XVI. For general policy and background on overpayment fraud referral, see GN 02201.050.

B. Policy for suspected fraud cases

1. Suspected fraud cases

To avoid weakening a potential court case, the FO must refer suspected fraud cases to the OIG before sending the initial notice of overpayment. For processing SSI overpayments, if there is a suspicion of fraud, see SI 02201.005D. For instructions on notifying the overpaid individual, see SI 02220.010.

2. Court-ordered restitution

a. Defendant pleads or is found guilty

If the defendant in a fraud prosecution pleads, or is found guilty, the court determines his or her sentence. The sentence usually includes restitution, as a part of the convicted defendant’s financial obligation (the amount, if any, must be repaid to the agency).

If the court orders repayment of the debt, but does not order restitution, the usual overpayment recovery policies and procedures apply.

The court’s sentence may also include fines and/or penalties. The Social Security Act does not give the agency the authority to seek restitution of fines or penalties. However, if the agency receives any monies representing the fines or penalties, the agency credits such monies to the trust fund(s), in which the overpayment occurred.

References

• SI 02220.012 – Collection of Title II Overpayments by Tax Refund Offset (TRO)

  through

• SI 02220.045 – SSI Overpayment – Recovery From an Estate

b. U.S. Attorney’s Office (USAO) prosecutes the fraud

The USAO that prosecutes the fraud case is responsible for enforcement of the collection of the court-ordered restitution. Within the USAO, the Financial Litigation Unit (FLU) is specifically responsible for enforcement of the court’s order. The FLU coordinates with the agency on the enforcement of the court-ordered restitution.

c. OIG reports the case

The OIG field agent prepares a report on the case (Form OI-68, Report of Court Ordered Restitution/Judgment), and sends it to the OIG Office of Investigations (OI) headquarters in Baltimore, Maryland. The OIG OI reviews the OI-68 for accuracy, and sends copies to the:

• Debt Management Section at the Mid-Atlantic Program Service Center (MATPSC); and

• Regional Office (RO) responsible for the State where the case was prosecuted.

d. MATPSC responsibility

The MATPSC receives and posts the restitution payments to the debtor’s Master Beneficiary Record (MBR) or Supplemental Security Record (SSR).

e. RO responsibility

The RO posts (or a FO posts) the debt (the court- ordered restitution) to the debtor’s SSR or MBR, and monitors the recovery of the court-ordered restitution.

3. Overpayment was waived, overpaid individual later convicted of fraud

If any part of the overpayment subject to the court order was waived prior to the court’s order, the fraud conviction permits the reopening of the waiver decision.

C. Procedure for cases returned from OIG after prosecution

The OIG returns the case file to the RO responsible for the State where the case was prosecuted.

Each RO assigns a staff member the responsibility for court-ordered restitution cases. He or she must:

1. Review the file to determine if the court-ordered restitution to the agency. If restitution was ordered, determine the individual’s probation period.

   NOTE: The probation period is important because the end of the probation period ends the court’s ability to enforce its order (sentence). If the information is not in the case file, contact is required with OIG to obtain the information.

2. Determine whether an initial overpayment notice was sent.

3. If the notice was not sent, the RO or (FO or PSC) prepares and sends a modified initial overpayment notice. The notice is sent on a SSA-L 8165, SSI Important Information. For instructions on notifying overpaid individuals, see SI 02220.010B.

   The overpaid amount on the notice is the full amount of the agency determined overpayment. If the amount of the court-ordered restitution is less than the agency determined amount, the overpaid individual is liable for repayment of the agency determined overpayment.

   The notice does not include waiver or appeal rights. Waiver is not available because the overpaid individual’s conviction precludes the agency finding the overpaid individual is “without fault.” Appeal of the overpayment is precluded by his or her conviction.

   If the overpaid individual is in current payment status (C01) (or returns to C01 or becomes eligible for Title II benefits) show a recovery rate of 100 percent.

4. If the initial overpayment notice is sent, notify the overpaid individual that:

   • Regardless of the amount of the court-ordered restitution, he or she is liable for the repayment of the full agency determined amount of the overpayment; and,

   • Neither waiver nor appeal of the overpayment is available because of his or her conviction for fraud.

     If the overpaid individual is in C01 (or returns to C01 or becomes eligible for Title II benefits), show a recovery rate of 100 percent.

5. FAX the OI-68 and court order to NDRED/eDIB, see GN 00301.322.

D. Monitoring the receipt of restitution payments

1. RO responsibility for court-ordered restitutions

The RO controls and monitors the court-ordered restitution payments.

The RO reviews the overpayment record six months after receiving the case from OIG, and reviews the MBR and the SSR, to determine whether the court-ordered payments are made. If they are, the RO conducts another review in six months.

If the review shows the court-ordered payments are not being made, the RO must contact the USAO’s FLU to determine whether the court received payments that the agency did not receive.

If the FLU states that there are no pending payments, contact the Probation Officer (PO) of the US District Court that ordered the restitution payments. Request the PO’s assistance in obtaining the court-ordered restitution payments.

If the PO is unresponsive to your request, or is unsuccessful in obtaining payments, review the case file and consult with the FLU to determine whether to return to the court for further enforcement action.

2. Critical restitution case

A critical restitution case is a case where monthly restitution payments are not made in the 60 days prior to the current date; that is, the date of the first six-month review.

• Immediately contact the FLU and the PO for their assistance in obtaining payment of the court-ordered restitution. If the FLU or PO are unsuccessful in obtaining payments, review the case file and consult with the FLU to determine whether to return to the court for further enforcement action

• If the court cannot provide assistance (for example, the probation period has ended), contact the Department of Justice (DOJ) to request action against the convicted individual, to collect the restitution ordered by the court. For instructions on contacting DOJ in Title II and Title XVI cases, see GN 02215.150, GN 02215.170, and SI 02220.035.

• If the DOJ closes the case, jurisdiction for collection of the overpayment reverts to the agency. The agency pursues all available administrative collection actions (some examples are, tax refund offset, credit bureau reporting, or administrative wage garnishment).

  NOTE: The DOJ usually keeps the case open for 20 years.

  References

  • GN 02201.050 - Overpayment-Fraud Referral

  • GN 02201.055 - Overpayment recovery After Fraud Conviction

  • SI 02220.001 - Recovery Procedures for SSI Overpayments - General

  • SI 02220.010 - SSI Overpayment-Notifying the Individual