Representative Payees Under the Civil Service Retirement System and Federal Employees' Retirement System

Citation86 FR 57011
Record Number2021-22282
Published date14 October 2021
SectionRules and Regulations
CourtPersonnel Management Office
Federal Register, Volume 86 Issue 196 (Thursday, October 14, 2021)
[Federal Register Volume 86, Number 196 (Thursday, October 14, 2021)]
                [Rules and Regulations]
                [Pages 57011-57015]
                From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
                [FR Doc No: 2021-22282]
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                Rules and Regulations
                 Federal Register
                ________________________________________________________________________
                This section of the FEDERAL REGISTER contains regulatory documents
                having general applicability and legal effect, most of which are keyed
                to and codified in the Code of Federal Regulations, which is published
                under 50 titles pursuant to 44 U.S.C. 1510.
                The Code of Federal Regulations is sold by the Superintendent of Documents.
                ========================================================================
                Federal Register / Vol. 86, No. 196 / Thursday, October 14, 2021 /
                Rules and Regulations
                [[Page 57011]]
                OFFICE OF PERSONNEL MANAGEMENT
                5 CFR Part 849
                RIN 3206-AO08
                Representative Payees Under the Civil Service Retirement System
                and Federal Employees' Retirement System
                AGENCY: Office of Personnel Management.
                ACTION: Final rule.
                -----------------------------------------------------------------------
                SUMMARY: The Office of Personnel Management (OPM) is issuing this final
                rule to promulgate regulations which administer the representative
                payee program authorized by statute. This final rule is necessary to
                ensure proper procedures for annuity payments due minors or individuals
                who are mentally incompetent or under other legal disability and are
                unable to manage their respective payments.
                DATES: This rule is effective October 14, 2021.
                FOR FURTHER INFORMATION CONTACT: Michael Shipley, (202) 606-0299.
                Email: [email protected]. Include the RIN in the subject line of
                the email.
                SUPPLEMENTARY INFORMATION: On March 8, 2021, OPM issued a proposed rule
                at 86 FR 13217 for the purpose of promulgating regulations to
                administer the representative payee program under the Civil Service
                Retirement System (CSRS) and the Federal Employees' Retirement System
                (FERS). Under CSRS, the provisions of Public Law 89-554, Sept. 6, 1966,
                80 Stat. 582 authorized the United States Civil Service Commission,
                precursor to the United States Office of Personnel Management (OPM), to
                make payments due a minor or an individual mentally incompetent, or
                under other legal disability, to a person who is constituted guardian
                or other fiduciary by the law of the State of residence of the claimant
                or any person, who in the judgment of the Commission, is responsible
                for the care of the claimant. Similarly, the FERS Act of 1986, Public
                Law 99-335, Title I, section 101(a), June 6, 1986, 100 Stat. 575,
                authorized OPM to make the same payments under FERS. According to these
                statutes, OPM has historically authorized these payments to
                individuals, and in some instances, organizations on behalf of the
                annuitant as representative payees.
                 On March 18, 2020, Congress enacted Public Law 116-126, 134 Stat.
                174-177 (2020), the Representative Payee Fraud Prevention Act of 2019
                (the Act), which made numerous changes to existing statutes regarding
                representative payees. First the Act officially defined the term
                representative payee under both CSRS and FERS as the ``person
                (including an organization) designated . . . to receive payment on
                behalf of a minor or an individual mentally incompetent or under other
                legal disability'' at 5 U.S.C. 8331(33) and 5 U.S.C. 8401(39),
                respectively. Ensuring that organization was added to the definition
                recognizes that other entities, such as agencies, institutions, nursing
                homes, et al., may serve as representative payees.
                 Congress also enacted 5 U.S.C. 8345a and 8466a to address the
                embezzlement or conversion of payments. Congress made it unlawful for a
                representative payee to use the funds received as a representative
                payee for any use other than the use and benefit of the individual on
                whose behalf the payments were received. OPM was given the authority to
                revoke certification as a representative payee, if we determine that a
                representative payee has embezzled or converted the annuity payments,
                and to certify payments to another representative payee or directly to
                the annuitant. Congress set forth the penalty for misuse of benefits by
                a representative payee, under title 18 U.S.C., as a fine, imprisonment
                for not more than 5 years, or both.
                 Furthermore, in selecting a representative payee, OPM was granted
                authority to defer or suspend the annuity payment until a
                representative payee is located, if we determine that paying the
                annuitant directly would cause substantial harm to the annuitant.
                Substantial harm exists if both of the following conditions exist:
                 (1) Direct payment of benefits can be expected to cause serious
                physical or mental injury to the individual; and
                 (2) The potential effect of the injury outweighs the effect of
                having no income to meet the basic needs of the individual.
                We have included this language concerning substantial harm to the
                proposed regulations.
                 Finally, the Act created limitations on who can be appointed as a
                representative payee. Individuals that have been convicted of a
                violation of: (1) 5 U.S.C. 8345a or 8466a; (2) section 208 or 1632 of
                the Social Security Act (42 U.S.C. 408, 1383a); or (3) section 6101 of
                title 38, are barred from serving as a representative payee.
                 OPM is promulgating these regulations to fully implement and
                administer the representative payee program for CSRS and FERS. The
                regulations are required to prevent misuse and fraud by representative
                payees.
                 The public comment period on the proposed rule ended May 7, 2021.
                OPM received four substantive comments. Three of the comments voiced
                general support for the proposed rule in protecting vulnerable
                individuals from potential misuse by the representative payee. OPM
                received one comment from the American Association of Nurse
                Practitioners (AANP). The AANP suggested amending the language in 5 CFR
                849.203 from ``medical professional'' to ``licensed health
                practitioner.'' In addition, the AANP suggested amending 5 CFR 849.602
                to include the language ``or other licensed health practitioner's''
                when identifying statements that are acceptable to stop representative
                payments. The AANP reasoned that the term licensed health practitioner
                is already defined under 5 CFR 339.104, and that these changes more
                closely align with other regulations at 5 CFR 831.1202 and 844.102 that
                OPM uses to administer annuity benefits under CSRS and FERS. OPM agrees
                and has adopted the AANP's recommendations by amending 5 CFR 849.203
                and 849.602, to include ``licensed health practitioner'' as
                appropriate. OPM has also amended 5 CFR 849.102 to include the
                definition for physicians and practitioners.
                [[Page 57012]]
                Regulatory Impact Analysis
                 OPM has examined the impact of this proposed rule as required by
                Executive Order 12866 and Executive Order 13563, which directs agencies
                to assess all costs and benefits of available regulatory alternatives
                and, if regulation is necessary, to select regulatory approaches that
                maximize net benefits (including potential economic, environmental,
                public, health, and safety effects, distributive impacts, and equity).
                A regulatory impact analysis must be prepared for major rules with
                economically significant effects of $100 million or more in any one
                year. This rule is not a ``significant regulatory action,'' under
                Executive Order 12866 and was not reviewed by the Office of Management
                and Budget (OMB).
                Regulatory Flexibility Act
                 The Office of Personnel Management certifies that this rule will
                not have a significant economic impact on a substantial number of small
                entities.
                Federalism
                 We have examined this rule in accordance with Executive Order
                13132, Federalism, and have determined that this rule will not have any
                negative impact on the rights, roles and responsibilities of State,
                local, or tribal governments.
                Civil Justice Reform
                 This regulation meets the applicable standard set forth in
                Executive Order 12988.
                Unfunded Mandates Reform Act of 1995
                 This rule will not result in the expenditure by state, local, and
                tribal governments, in the aggregate, or by the private sector, of $100
                million or more in any year and it will not significantly or uniquely
                affect small governments. Therefore, no actions were deemed necessary
                under the provisions of the Unfunded Mandates Reform Act of 1995.
                Congressional Review Act
                 The Congressional Review Act (5 U.S.C. 801 et seq.) requires rules
                (as defined in 5 U.S.C. 804) to be submitted to Congress before taking
                effect. OPM will submit to Congress and the Comptroller General of the
                United States a report regarding the issuance of this action before its
                effective date, as required by 5 U.S.C. 801. This is not a ``major
                rule'' as defined by the Congressional Review Act (5 U.S.C. 804(2)).
                Paperwork Reduction Act
                 Notwithstanding any other provision of law, no person is required
                to respond to, nor shall any person be subject to a penalty for failure
                to comply with a collection of information subject to the requirements
                of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.) (PRA),
                unless that collection of information displays a currently valid OMB
                Control Number. Two currently approved collections are associated with
                this rulemaking.
                 3206-0140 Representative Payee Application/Information
                Necessary for a Competency Determination which is comprised of 2
                forms--an application form and a separate form for a competency
                determination. OPM is requesting, for OMB has approval, a change to the
                competency determination form to add ``other licensed health
                practitioner'' when identifying the medical information required for
                the competency determination. An Emergency request will be published
                shortly after this rule.
                 3206-0208--Representative Payee Survey This information
                collection will not be impacted due to the changes in this rule.
                 The systems of record notice for both collections is: https://www.opm.gov/information-management/privacy-policy/sorn/opm-sorn-central-1-civil-service-retirement-and-insurance-records.pdf.
                List of Subjects in 5 CFR Part 849
                 Claims, Disability benefits, Fraud, Pensions, Retirement.
                Office of Personnel Management.
                Alexys Stanley,
                Regulatory Affairs Analyst.
                0
                For the reasons stated in the preamble, the Office of Personnel
                Management adds 5 CFR part 849 to read as follows:
                PART 849--REPRESENTATIVE PAYEES
                Subpart A--General Provisions
                Sec.
                849.101 Applicability and purpose.
                849.102 Definitions.
                849.103 Implementing directives.
                Subpart B--Determining Whether or Not Representative Payment Is
                Appropriate
                849.201 When to make payment to a representative payee.
                849.202 Payment of annuity while finding a suitable representative
                payee.
                849.203 Information considered in determining whether to appoint a
                representative payee.
                Subpart C--Selection of a Representative Payee
                849.301 Information considered in selecting a representative payee.
                849.302 Order of preference in selecting a representative payee.
                849.303 Individuals who may not serve as a representative payee.
                849.304 Selecting a representative payee.
                849.305 Notice of determination to select a representative payee.
                Subpart D--Responsibility and Accountability of a Representative Payee
                849.401 Responsibilities of a representative payee.
                849.402 Use of payments.
                849.403 Accountability of a representative payee.
                Subpart E--Misuse of Annuity by a Representative Payee
                849.501 Misuse of benefits by a representative payee.
                849.502 Liability for misused funds.
                Subpart F--Changes to the Representative Payee
                849.601 When a new representative payee will be selected.
                849.602 When representative payments will be stopped.
                849.603 Transfer of conserved or accumulated funds.
                 Authority: 5 U.S.C. 8331; 5 U.S.C. 8345(e)-(f); 5 U.S.C. 8345a;
                5 U.S.C. 8401; 5 U.S.C. 8461; 5 U.S.C. 8466(c)-(d); 5 U.S.C. 8466a.
                Subpart A--General Provisions
                Sec. 849.101 Applicability and purpose.
                 This part contains regulations of the Office of Personnel
                Management (OPM) to implement the provisions 5 U.S.C. 8345(e)-(f),
                8345a, 8466(c)-(d), and 8466a regarding payment of an annuity to a
                representative payee. This part establishes the criteria OPM uses to
                determine if representative payments are appropriate, the information
                OPM uses to select a representative payee, the responsibilities of a
                representative payee, the accountability of a representative payee, the
                limitations on the appointment of a representative payee, and the
                definition of and penalty for misuse of benefits by the representative
                payee.
                Sec. 849.102 Definitions.
                 As used in this part:
                 Agency means the Office of Personnel Management (OPM).
                 CSRS means the Civil Service Retirement System as described in
                subchapter III of chapter 83 of title 5, United States Code.
                 FERS means the Federal Employees' Retirement System as described in
                chapter 84 of title 5, United States Code.
                 Misuse of benefits means the embezzlement or conversion of all or
                any part of the amount received by the
                [[Page 57013]]
                representative payee for a use other than for the use and benefit of
                the minor or individual on whose behalf such payments were received.
                 Physician and practitioner have the same meaning given these terms
                in Sec. 339.104 of this chapter.
                 Representative payee means a person, who is at least 18 years of
                age, or an organization designated to receive annuity payments on
                behalf of a minor or an individual mentally incompetent or under other
                legal disability.
                Sec. 849.103 Implementing directives.
                 The Director may prescribe, in the form he or she deems
                appropriate, such detailed procedures as are necessary to carry out the
                purpose of this part.
                Subpart B--Determining Whether or Not Representative Payment is
                Appropriate
                Sec. 849.201 When to make payment to a representative payee.
                 The agency will make payment to a representative payee--
                 (a) If payments are due to a minor under the age of 18; or
                 (b) If payments are due to an annuitant or survivor who is mentally
                incompetent or under other legal disability; or
                 (c) If payments are due to an annuitant when the annuitant is
                physically or mentally incapable of managing or directing the
                management of his or her benefit.
                Sec. 849.202 Payment of annuity while finding a suitable
                representative payee.
                 (a) Annuity payments will be made directly to the annuitant or
                survivor annuitant while a suitable representative payee is located,
                unless the agency determines that direct payment would cause
                substantial harm to the individual.
                 (b) Substantial harm exists if both of the following conditions
                exist:
                 (1) Direct payment of benefits can be expected to cause serious
                physical or mental injury to the individual; and
                 (2) The potential effect of the injury outweighs the effect of
                having no income to meet the basic needs of the individual.
                 (c) If the agency determines that direct payment of benefits would
                cause substantial harm to the annuitant, annuity payments may be
                deferred (in the case of initial entitlement to benefits) or suspended
                (in the case of existing entitlement to benefits) until such time as a
                representative payee is appointed.
                 (d) Annuity payments will commence or resume as soon as practicable
                and will include all retroactive payments due to be paid.
                Sec. 849.203 Information considered in determining whether to appoint
                a representative payee.
                 In determining whether to appoint a representative payee, the
                agency will consider the following information:
                 (a) Evidence of legal guardianship or other court determinations.
                Evidence of the appointment of a legal guardian or other person legally
                vested with the care of the individual or estate of an incompetent or a
                minor shall be a certified copy of the court's determination.
                 (b) Medical evidence. The agency will use medical evidence to help
                determine whether an annuitant is capable of managing or directing the
                management of benefit payments. For example, a statement by a physician
                or other licensed health practitioner, based upon his or her recent
                examination of the annuitant and his or her knowledge of the
                annuitant's present condition, will be used in the agency's
                determination, if it includes information concerning the nature of the
                annuitant's illness or disability, the annuitant's chances for
                recovery, and the opinion of the physician or other licensed health
                practitioner as to whether the annuitant is able to manage or direct
                the management of benefit payments.
                 (c) Other evidence. The agency may also require statements of
                relatives, friends, or other people in a position to know and observe
                the annuitant, which contain information helpful to the agency in
                deciding whether the annuitant is able to manage or direct the
                management of benefit payments.
                Subpart C--Selection of a Representative Payee
                Sec. 849.301 Information considered in selecting a representative
                payee.
                 The goal in selecting a payee is to select the person,
                organization, or institution that will best serve the interest of the
                annuitant. In making the selection, the agency considers--
                 (a) The age of the representative payee applicant. An individual
                must be over the age of 18 to serve as a representative payee, except
                as listed in Sec. 849.303(a);
                 (b) The relationship of the person, organization, or institution to
                the annuitant;
                 (c) Legal authority, in the form of conservatorship or
                guardianship, that the person, organization, or institution has to act
                on behalf of the annuitant;
                 (d) The amount of concern that the person or organization shows in
                the annuitant;
                 (e) Whether the potential payee has custody of the annuitant;
                 (f) Whether the potential payee is in a position to know of and
                look after the needs of the annuitant;
                 (g) Whether the representative payee applicant is currently
                serving, or has previously served, as a representative payee for other
                annuitants; and
                 (h) The potential representative payee's criminal history.
                Sec. 849.302 Order of preference in selecting a representative payee.
                 As a guide in selecting a representative payee, categories of
                preferred payees are set out in paragraphs (a) through (e) of this
                section. The primary concern of the agency is to select the payee who
                will best serve the annuitant's interest. The preferences, in
                descending order of importance, are:
                 (a) A legal conservator, guardian, spouse, or other relative who
                has custody or guardianship of the annuitant or who demonstrates strong
                concern for the personal welfare of the annuitant;
                 (b) A friend or neighbor who has custody or guardianship of the
                annuitant or demonstrates strong concern for the personal welfare of
                the annuitant;
                 (c) A public or nonprofit agency or institution having custody or
                guardianship of the annuitant;
                 (d) A private institution operated for profit and licensed under
                State law, which has custody or guardianship of the annuitant; and
                 (e) Persons other than those listed in paragraphs (a) through (d)
                of this section who are qualified to carry out the responsibilities of
                a representative payee and who are able and willing to serve as a payee
                for an annuitant; e.g., members of community groups or organizations
                who volunteer to serve as representative payee for an annuitant.
                Sec. 849.303 Individuals who may not serve as a representative payee.
                 A representative payee applicant may not serve as a representative
                payee if he or she:
                 (a) Is under the age of 18, unless he or she is the custodial
                parent of the minor child applying for or receiving the annuity;
                 (b) Is found by a court to be incompetent or receives benefits
                under title II or title XVI of the Social Security Act through a
                representative payee or receives a retirement annuity pursuant to CSRS
                or FERS through a representative payee;
                 (c) Has previously served as a representative payee and has been
                [[Page 57014]]
                found by a court of competent jurisdiction to have misused benefits;
                 (d) Has been convicted of a violation of:
                 (1) 5 U.S.C. 8345a or 8466a;
                 (2) Section 208 or 1632 of the Social Security Act (42 U.S.C. 408,
                1383a); or
                 (3) 38 U.S.C 6101; or
                 (e) Has been convicted of an offense resulting in imprisonment for
                more than one year. The agency may make exception to the prohibition in
                this paragraph (e) if the nature of the conviction is such that
                selection of the applicant poses no risk to the annuitant and the
                exception is in the best interest of the annuitant.
                Sec. 849.304 Selecting a representative payee.
                 Before selecting an individual or organization to serve as a
                representative payee, the agency will conduct an investigation. The
                investigation will:
                 (a) Require the applicant to submit documented proof of identity.
                 (b) Verify the applicant's social security number.
                 (c) Conduct a background check on the applicant to determine if the
                applicant has been convicted of any crimes as defined in Sec.
                849.303(d) or (e).
                 (d) Determine if the applicant has previously served as a
                representative payee and if any previous appointments as representative
                payee were revoked or terminated due to misuse.
                Sec. 849.305 Notice of the determination to select a representative
                payee.
                 (a) If the agency determines that the annuitant requires a
                representative payee due to mental incompetence or other legal
                disability or is physically or mentally unable to manage or direct the
                management of his or her annuity payments, the agency will issue a
                written decision to the annuitant. The decision will include a
                statement of the findings and determinations; specifically, the
                individual or organization named as the representative payee, and an
                explanation of the right to appeal the decision under Sec. Sec.
                831.110 and 841.307 of this chapter. If the annuitant appeals the
                decision, the agency will continue to make direct payments to the
                annuitant until the due process rights have been exhausted.
                 (b) A decision by the agency to not select an individual or
                organization as a representative payee is not subject to the due
                process procedures described in 5 U.S.C. 8347(d) and 8461(e).
                Subpart D--Responsibility and Accountability of a Representative
                Payee
                Sec. 849.401 Responsibilities of a representative payee.
                 (a) A representative payee shall, subject to review by the agency
                and subject to such requirements as it may periodically prescribe,
                apply the payments made on behalf of the annuitant only for the use and
                benefit of such annuitant, and in a manner or purpose that is in the
                best interest of the annuitant.
                 (b) A representative payee shall notify the agency of any event
                that will affect the amount of benefits the annuitant receives or the
                right of the annuitant to receive benefits.
                 (c) A representative payee shall notify the agency of any change in
                circumstances that would affect performance of the payee's
                responsibilities.
                 (d) A representative payee shall keep the annuity paid to him or
                her on behalf of the annuitant separate from his or her own money in an
                account that shows that the annuitant is still the owner of the funds.
                The applicant must show proof of this account when applying to be the
                representative payee and use this account for direct deposit.
                Exceptions to this paragraph (d) are joint accounts for spouses, when
                one spouse applies to be representative payee for the other spouse and
                they already have an existing joint account.
                 (e) Any interest earned on the annuity will be the annuitant's
                property.
                 (f) A representative payee shall respond to requests, regarding the
                use of annuity payments, from OPM within a specified period of time.
                Sec. 849.402 Use of payments.
                 (a) Current maintenance. Payments certified to a representative
                payee on behalf of an annuitant shall be considered as having been
                applied for the use and benefit of the annuitant when they are used for
                the annuitant's current maintenance. Current maintenance includes costs
                incurred in obtaining food, shelter, clothing, medical care, and
                personal comfort items.
                 (b) Institutional care. If an annuitant is receiving care in a
                Federal, state, or private institution because of mental or physical
                incapacity, current maintenance includes the customary charges made by
                the institution in providing care and maintenance, as well as
                expenditures for those items which will aid in the annuitant's recovery
                or release from the institution or expenses for personal needs which
                will improve the annuitant's conditions while in the institution.
                 (c) Support of legal dependents. If the current maintenance needs
                of the annuitant are met, the representative payee may use part of the
                payments for the support of the annuitant's legally dependent spouse,
                child, and/or parent.
                 (d) Claims of creditors. A representative payee may satisfy debts
                to creditors out of present benefit payments only if the current and
                reasonably foreseeable needs of the annuitant are met.
                 (e) Conservation and investment. After the representative payee has
                used the annuity payments consistent with the rules in paragraphs (a)
                through (d) of this section, any remaining annuity shall be conserved
                or invested on behalf of the annuitant. Any investment must show
                clearly that the representative payee holds the property in trust for
                the annuitant.
                Sec. 849.403 Accountability of a representative payee.
                 (a) An individual, or institution, to whom payments are made as
                representative payee on behalf of an annuitant is accountable for the
                use of the payments and shall submit a written report in such form and
                at such times as the agency may require, accounting for the payments
                certified to him or her on behalf of the annuitant.
                 (b) If, however, such payee is a court-appointed fiduciary and, as
                such, is required to make an annual accounting to the court, a true
                copy of each such account filed with the court may be submitted in lieu
                of the accounting form prescribed by the agency.
                 (c) If any representative payee fails to submit the required
                accounting within the specified period of time after it is requested,
                no further payments shall be made to the representative payee on behalf
                of the annuitant unless for good cause shown, the default of the
                representative payee is excused by the agency and the required
                accounting is thereafter submitted.
                 (d) At any time after the agency has selected a representative
                payee, the agency may ask such payee to submit information showing a
                continuing relationship to the annuitant and a continuing
                responsibility for the care of the annuitant. If the representative
                payee does not give the agency the requested information within the
                specified period of time, the agency may stop paying such payee unless
                the agency determines that the payee had a good reason for not
                complying with the request, and the agency receives the information
                requested.
                [[Page 57015]]
                Subpart E--Misuse of Annuity by a Representative Payee
                Sec. 849.501 Misuse of benefits by a representative payee.
                 (a) It is unlawful for a representative payee to misuse the
                payments received on behalf of an annuitant. For purposes of this
                subpart, misuse of benefits by a representative payee occurs in any
                case in which the representative payee receives payment on behalf of an
                annuitant and embezzles or converts such payment, or any part thereof,
                to a use other than for the use and benefit of the annuitant.
                 (b) The penalty for a representative payee found to be in violation
                of paragraph (a) of this section is a fine, imprisonment for not more
                than 5 years, or both.
                 (c) If the agency determines that a representative payee has
                misused any payments as described in paragraph (a) of this section, the
                agency will promptly revoke the certification for payment of benefits
                to the representative payee, and will make payment to an alternative
                representative payee or, if the interest of the annuitant would be
                served thereby, to the annuitant.
                 (d) The agency will make the annuitant whole by repaying any
                annuity that was misused by the representative payee once the misused
                benefits have been repaid to the agency by the representative payee.
                Sec. 849.502 Liability for misused funds.
                 (a) A representative payee who misuses benefits, as determined in
                Sec. 849.501(a), is responsible for repayment of the misused benefits.
                 (b) OPM will seek restitution from the former representative payee.
                Subpart F--Changes of the Representative Payee
                Sec. 849.601 When a new representative payee will be selected.
                 (a) When the agency learns that the interests of the annuitant are
                not served by continuing payment to the present representative payee or
                that the present representative payee is no longer able or willing to
                carry out the payee responsibilities, the agency will undertake to find
                a new representative payee.
                 (b) The agency will select a new representative payee if the agency
                finds a preferred payee or if the present payee:
                 (1) Has been found by the agency or a court of competent
                jurisdiction to have misused the benefits;
                 (2) Has not used the benefit payments on the annuitant's behalf in
                accordance with the rules in this part;
                 (3) Has not carried out the other responsibilities described in
                this subpart;
                 (4) Dies;
                 (5) No longer wishes to be the representative payee;
                 (6) Is unable to manage the benefit payments; or
                 (7) Fails to cooperate, within a reasonable time, in providing
                evidence, accounting, or other information requested by the agency.
                 (c) The agency may suspend payment as explained in Sec. 849.202(c)
                if we determine that making direct payment to the annuitant would cause
                substantial harm. Payments, including all retroactive amounts due, will
                resume once a representative payee is located.
                Sec. 849.602 When representative payments will be stopped.
                 If an annuitant demonstrates that he or she is mentally and
                physically able to manage or direct the management of benefit payments,
                the agency will make direct payment to the annuitant. Information which
                the annuitant may give to the agency to support his or her request for
                direct payment includes, but is not limited to, the following:
                 (a) A physician's or other licensed health practitioner's statement
                regarding the annuitant's condition, or a statement by a medical
                officer of the institution where the annuitant is or was confined,
                showing that the annuitant is able to manage or direct the management
                of his or her funds;
                 (b) A certified copy of a court order restoring the annuitant's
                rights in a case where an annuitant was adjudged legally incompetent;
                or
                 (c) Other evidence which establishes the annuitant's ability to
                manage or direct the management of benefits.
                Sec. 849.603 Transfer of conserved or accumulated funds.
                 A representative payee who has conserved or invested annuity
                payments shall transfer these funds and any interest earned from the
                invested funds to either a successor payee, to the annuitant, or to the
                agency as we will specify. If the funds and the earned interest are
                returned to the agency, we will recertify them to the successor
                representative payee or to the annuitant.
                [FR Doc. 2021-22282 Filed 10-13-21; 8:45 am]
                BILLING CODE 6325-38-P
                

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