U.S. House Examines Social Security Direct Deposits

The U.S. House Social Security Subcommittee recently held a hearing to examine the impact of direct deposit of Social Security benefits on beneficiaries. The Subcommittee members and witnesses all support the use of electronic funds transfer (EFT) for Social Security benefits, but all expressed concerns about increased identity theft and fraud.

The Debt Collection Improvement Act of 1966 requires that all federal payments be made through electronic funds transfer. Regulations from the Department of Treasury require that all payments for current and new Social Security beneficiaries be made electronically by March 1, 2012. An electronic payment option can include direct deposit to a bank account, a Direct Express card issued by the Treasury Department or another re-loadable debit card. Waivers are available to certain individuals.

Testimony established that problems exist with identity theft and fraud, as well as the difficulty some beneficiaries encounter in obtaining a waiver of the EFT requirement. Inspector General O’Carroll testified that SSA receives 50 questionable changes to direct deposit accounts each day.

Randy Zeldin, Esq. is a Social Security Disability Attorney representing individual claimants in Boca Raton, Ft. Lauderdale and West Palm Beach, Florida.