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Consumer Banking and Payments Law: 31 C.F.R. § 208.5 Accounts for disbursement of Federal payments.

Treasury may designate a Financial Agent to establish and administer Treasury-sponsored accounts for individuals for the disbursement of Federal payments, including benefit, retirement, salary, miscellaneous, vendor, expense reimbursement and tax payments. Such accounts may be established upon terms and conditions that the Secretary considers appropriate or necessary and shall be made available at a reasonable cost and with the same consumer protections provided to other account holders at the financial institution.

Consumer Banking and Payments Law: 31 C.F.R. § 208.8 Recipient responsibilities.

Each recipient who is required to receive payment by electronic funds transfer shall provide the information necessary to effect payment by electronic funds transfer. For recipients who do not designate a bank account for the receipt of payments, Treasury may disburse payments to a Treasury-sponsored account or to an account to which the recipient is receiving other Federal payments.

Consumer Banking and Payments Law: 31 C.F.R. § 208.11 Accounts for disaster victims.

Treasury may establish and administer accounts at any financial institution designated as a financial agent for disaster victims in order to allow for the delivery by electronic funds transfer of one or more Federal payments. Such accounts may be established upon terms and conditions that the Secretary considers appropriate or necessary in light of the circumstances.

Consumer Banking and Payments Law: Introduction and Listing of Provisions

Title 31—Money and Finance–Treasury

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Chapter II. Fiscal Service, Department of the Treasury

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Part 210. Federal Government Participation in the Automated Clearing House

Sec.

210.1 Scope; relation to other regulations.

210.2 Definitions.

210.3 Governing law.

Subpart A—General

210.4 Authorizations and revocations of authorizations.

Consumer Banking and Payments Law: 31 C.F.R. § 210.1 Scope; relation to other regulations.

This part governs all entries and entry data originated or received by an agency through the Automated Clearing House (ACH) network, except as provided in paragraphs (a) and (b) of this section. This part also governs reclamations of benefit payments.

(a) Federal tax payments received by the Federal Government through the ACH system that are governed by part 203 of this title shall not be subject to any provision of this part that is inconsistent with part 203.

Consumer Banking and Payments Law: 31 C.F.R. § 210.2 Definitions.

For purposes of this part, the following definitions apply. Any term that is not defined in this part shall have the meaning set forth in the ACH Rules.

(a) ACH Rules means the 2021 Operating Rules & Guidelines, including Supplement #1–2021, (both incorporated by reference, see § 210.3(b)) published by Nacha, a national association of regional member clearing house associations, ACH Operators, and participating financial institutions located in the United States.

Consumer Banking and Payments Law: 31 C.F.R. § 210.3 Governing law.

(a) Federal Law. The rights and obligations of the United States and the Federal Reserve Banks with respect to all Government entries, and the rights of any person or recipient against the United States and the Federal Reserve Banks in connection with any Government entry, are governed by this part, which has the force and effect of Federal law.

Consumer Banking and Payments Law: 31 C.F.R. § 210.4 Authorizations and revocations of authorizations.

(a) Requirements for authorization. Each debit and credit entry subject to this part shall be authorized in accordance with the applicable ACH Rules and the following additional requirements:

(1) The agency or the RDFI that accepts the recipient’s authorization shall verify the identity of the recipient and, in the case of a written authorization requiring the recipient’s signature, the validity of the recipient’s signature.

Consumer Banking and Payments Law: 31 C.F.R. § 210.5 Account requirements for Federal payments.

(a) Notwithstanding ACH Rules 2.1.2, 4.1.3, and Appendix Two, section 2.2 (listing general ledger and loan accounts as permissible transaction codes), an ACH credit entry representing a Federal payment other than a vendor payment shall be deposited into a deposit account at a financial institution. For all payments other than vendor payments, the account at the financial institution shall be in the name of the recipient, except as provided in paragraph (b) of this section.

Consumer Banking and Payments Law: 31 C.F.R. § 210.6 Agencies.

Notwithstanding any provision of the ACH Rules, including Subsections 2.4.5, 2.8.4, 4.3.5, 2.9.2, 3.2.2, and 3.13.3, agencies shall be subject to the obligations and liabilities set forth in this section in connection with Government entries.

(a) Receiving entries. An agency may receive ACH debit or credit entries only with the prior written authorization of the Service.

Consumer Banking and Payments Law: 31 C.F.R. § 210.7 Federal Reserve Banks.

(a) Fiscal Agents. Each Federal Reserve Bank serves as Fiscal Agent of the Treasury in carrying out its duties as the Federal Government’s ACH Operator under this part. As Fiscal Agent, each Federal Reserve Bank shall be responsible only to the Treasury and not to any other party for any loss resulting from the Federal Reserve Bank’s action, notwithstanding Section 11.5 and Article 8 of the ACH Rules. Each Federal Reserve Bank may issue operating circulars not inconsistent with this part which shall be binding on financial institutions.

Consumer Banking and Payments Law: 31 C.F.R. § 210.9 Parties to the reclamation.

(a) Agreement of RDFI. An RDFI’s acceptance of a benefit payment pursuant to this part shall constitute its agreement to this subpart. By accepting a benefit payment subject to this part, the RDFI authorizes the debiting of the Federal Reserve Bank account utilized by the RDFI in accordance with the provisions of § 210.10(e).

Consumer Banking and Payments Law: 31 C.F.R. § 210.10 RDFI liability.

(a) Full liability. An RDFI shall be liable to the Federal Government for the total amount of all benefit payments received after the death or legal incapacity of a recipient or the death of a beneficiary unless the RDFI has the right to limit its liability under § 210.11 of this part. An RDFI shall return any benefit payments received after the RDFI becomes aware of the death or legal incapacity of a recipient or the death of a beneficiary, regardless of the manner in which the RDFI discovers such information.

Consumer Banking and Payments Law: 31 C.F.R. § 210.11 Limited liability.

(a) Right to limit its liability. If an RDFI does not have actual or constructive knowledge of the death or legal incapacity of a recipient or the death of a beneficiary at the time it receives one or more benefit payments on behalf of the recipient, the RDFI’s liability to the agency for those payments shall be limited to:

(1) An amount equal to:

Consumer Banking and Payments Law: 31 C.F.R. § 210.12 RDFI’s rights of recovery.

(a) Matters between the RDFI and its customer. This subpart does not authorize or direct an RDFI to debit or otherwise affect the account of a recipient. Nothing in this subpart shall be construed to affect the right an RDFI has under state law or the RDFI’s contract with a recipient to recover any amount from the recipient’s account.

Consumer Banking and Payments Law: 31 C.F.R. § 210.13 Notice to account owners.

Provision of notice by RDFI. Upon receipt by an RDFI of a notice of reclamation, the RDFI immediately shall mail to the last known address of the account owner(s) or otherwise provide to the account owner(s) a copy of any notice required by the Service to be provided to account owners as specified in the Green Book. Proof that this notice was sent may be required by the Service.

Consumer Banking and Payments Law: 31 C.F.R. § 210.14 Erroneous death information.

(a) Notification of error to the agency. If, after the RDFI responds fully to the notice of reclamation, the RDFI learns that the recipient or beneficiary is not dead or legally incapacitated or that the date of death is incorrect, the RDFI shall inform the agency that certified the underlying payment(s) and directed the Service to reclaim the funds in dispute.