By PHILLIP LEE
The United States Treasury decree that all recipients of federal government benefits must select a form of electronic means of payment — either direct deposit or debit card — for their benefits by March 1, 2013, or be in violation of Federal law has drawn harsh criticism from the Financial Service Centers of America.
According to FiSCA, the Treasury’s position is inconsistent with testimony offered to Congress last fall which clearly stated that beneficiaries would continue to receive their payments via paper check
if they had not signed up for an electronic form of payment.
As a result, FiSCA has launched a campaign to raise awareness that customers can still receive their federal benefits via paper checks after March 1.
Can It or Can’t It
There have been conflicting reports on whether the Treasury can force such a mandate. Walt Henderson, director of the Go Direct campaign for the U.S. Treasury, has stated in various press reports that Treasury cannot force recipients to accept electronic delivery methods.
In a New York Times article dated January 10, Henderson was quoted as saying, “We don’t have the authority to change their payment method without their permission.”
FiSCA is providing in-store, digital and online materials to help its members communicate with their customers about the options they have for receiving their federal benefits.
“The reality is that recipients who have not signed up for electronic payments will still receive a paper check,” says Joseph M. Doyle, chairman of FiSCA.
“Nevertheless, there is a great deal of confusion among our customers as to what is going to happen after March 1. A significant segment of our customers have told us they don’t want to receive their federal payments electronically. For them, paper checks work best, and they are looking to us for solutions. They need to know they do not have to select one of Treasury’s preferred options. Checks will still be mailed. In addition, financial service centers have an array of options that can better meet customers’ needs.”
“We view this awareness campaign as an essential customer service initiative,” Doyle continues. “Our customers have questions when it comes to receiving federal payments, and we have the answers.”
On Sept. 12, 2012, the House Committee on Ways and Means, Subcommittee on Social Security, held a hearing on the rule requiring electronic payment of federal benefits by March, 2013.