Social Security has adopted a new rule that prohibits people convicted of certain crimes from serving as representative payees involving Social Security benefits after Congress passed a law similarly prohibiting certain people from serving as representative payees.
In certain instances Social Security will choose a representative payee to manage the Social Security benefits of people who have been found disabled and it has been determined they are unable to manage the benefits on their own. Typically representative payees are chosen for beneficiaries who have been diagnosed with mental health impairments and intellectual impairments.
Below is a summary from Social Security regarding the new rule, followed by background on the need for the rule.
Summary
We are finalizing our proposed regulations on conducting background checks to prohibit persons convicted of certain crimes from serving as representative payees under the Social Security Act (Act), as required by the Strengthening Protections for Social Security Beneficiaries Act of 2018.
Background
Representative payees manage benefit payments for beneficiaries or recipients who are incapable, due to a mental or physical impairment, of managing their Social Security, Special Veterans Benefits, or Supplemental Security Income (SSI) payments, or of directing another person to manage those payments. Generally, if a beneficiary or recipient is under age 18, we will pay benefits to a representative payee; however, in certain situations, we make direct payments to a beneficiary under age 18 who shows the ability to manage the benefits. In cases where the beneficiary or recipient is 18 years or older, we select a representative payee if we believe that payment of benefits through a representative payee, rather than direct payment to the beneficiary, will better serve the beneficiary’s interest. A representative payee may be an organization, such as a social service agency, or a person, such as a parent, relative, or friend of the beneficiary. We require a representative payee to use benefits in the beneficiary’s best interest and, with certain exceptions, to report expenditures to us to ensure the representative payee is using funds appropriately.
