Title: Representative Payee Fraud Prevention Act of 2019
Policy area: Government Operations and Politics

Summary:
Representative Payee Fraud Prevention Act of 2019
This bill prohibits a representative payee (i.e., a person designated to receive payments on behalf of a minor, a mentally incompetent individual, or an individual under other legal disability) from embezzling or converting the amounts received from certain retirement funds.
If the Office of Personnel Management (OPM) determines that a representative payee has embezzled or converted payments from the Civil Service Retirement System or the Federal Employees Retirement System for a use other than the benefit of the individual on whose behalf such payments were received, OPM shall revoke the certification for payment of benefits to the representative payee.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[S. 1430 Introduced in Senate (IS)]

<DOC>






116th CONGRESS
  1st Session
                                S. 1430

       To amend title 5, United States Code, to prevent fraud by 
                         representative payees.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                              May 13, 2019

 Mr. Lankford (for himself, Mr. Peters, and Ms. Sinema) introduced the 
 following bill; which was read twice and referred to the Committee on 
               Homeland Security and Governmental Affairs

_______________________________________________________________________

                                 A BILL


 
       To amend title 5, United States Code, to prevent fraud by 
                         representative payees.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Representative Payee Fraud 
Prevention Act of 2019''.

SEC. 2. REPRESENTATIVE PAYEE FRAUD.

    (a) Definitions.--
            (1) CSRS.--Section 8331 of title 5, United States Code, is 
        amended--
                    (A) in paragraph (31), by striking ``and'' at the 
                end;
                    (B) in paragraph (32), by striking the period at 
                the end and inserting ``; and''; and
                    (C) by adding at the end the following:
            ``(33) `representative payee' means a person (including an 
        organization) appointed under section 8345(e)(1) to receive 
        payments on behalf of a minor or an individual mentally 
        incompetent or under other legal disability.''.
            (2) FERS.--Section 8401 of title 5, United States Code, is 
        amended--
                    (A) in paragraph (37), by striking ``and'' at the 
                end;
                    (B) in paragraph (38), by striking the period at 
                the end and inserting ``; and''; and
                    (C) by adding at the end the following:
            ``(39) `representative payee' means a person (including an 
        organization) appointed under section 8466(c)(1) to receive 
        payments on behalf of a minor or an individual mentally 
        incompetent or under other legal disability.''.
    (b) Embezzlement or Conversion.--
            (1) CSRS.--Subchapter III of chapter 83 of title 5, United 
        States Code, is amended by inserting after section 8345 the 
        following:
``Sec. 8345a. Embezzlement or conversion of payments
    ``(a) Embezzling and Conversion Generally.--
            ``(1) In general.--It shall be unlawful for a 
        representative payee to embezzle or in any manner convert all 
        or any part of the amounts received from payments received as a 
        representative payee to a use other than for the use and 
        benefit of the minor or individual on whose behalf such 
        payments were received.
            ``(2) Revocation.--If the Office determines that a 
        representative payee has embezzled or converted payments as 
        described in paragraph (1), the Office shall promptly revoke 
        payments to the representative payee.
    ``(b) Penalty.--Any person who violates subsection (a)(1) shall be 
fined under title 18, imprisoned for not more than 5 years, or both.
    ``(c) Prima Facie Evidence.--Any willful neglect or refusal by a 
representative payee to make and file proper accountings or reports 
concerning the amounts received from payments authorized under section 
8345(e) as required by law shall be taken to be sufficient evidence 
prima facie of the embezzlement or conversion of such amounts.''.
            (2) FERS.--Subchapter VI of chapter 84 of title 5, United 
        States Code, is amended by inserting after section 8466 the 
        following:
``Sec. 8466a. Embezzlement or conversion of payments
    ``(a) Embezzling and Conversion Generally.--
            ``(1) In general.--It shall be unlawful for a 
        representative payee to embezzle or in any manner convert all 
        or any part of the amounts received from payments received as a 
        representative payee to a use other than for the use and 
        benefit of the minor or individual on whose behalf such 
        payments were received.
            ``(2) Revocation.--If the Office determines that a 
        representative payee has embezzled or converted payments as 
        described in paragraph (1), the Office shall promptly revoke 
        payments to the representative payee.
    ``(b) Penalty.--Any person who violates subsection (a)(1) shall be 
fined under title 18, imprisoned for not more than 5 years, or both.
    ``(c) Prima Facie Evidence.--Any willful neglect or refusal by a 
representative payee to make and file proper accountings or reports 
concerning the amounts received from payments authorized under section 
8466(c) as required by law shall be taken to be sufficient evidence 
prima facie of the embezzlement or conversion of such amounts.''.
            (3) Technical and conforming amendments.--
                    (A) The table of sections for chapter 83 of title 
                5, United States Code, is amended by inserting after 
                the item relating to section 8345 the following:

``8345a. Embezzlement or conversion of payments.''.
                    (B) The table of sections for chapter 84 of title 
                5, United States Code, is amended by inserting after 
                the item relating to section 8466 the following:

``8466a. Embezzlement or conversion of payments.''.
    (c) Deferral of Payment Pending Appointment of Representative 
Payee.--
            (1) CSRS.--Section 8345(e) of title 5, United States Code, 
        is amended--
                    (A) by inserting ``(1)'' after ``(e)'';
                    (B) in the first sentence, by inserting 
                ``(including an organization)'' after ``person'';
                    (C) in the second sentence--
                            (i) by inserting ``(including an 
                        organization)'' after ``any person''; and
                            (ii) by inserting ``and may appropriately 
                        receive such payments on behalf of the 
                        claimant'' after ``claimant''; and
                    (D) by adding at the end the following:
    ``(2) If the Office determines that direct payment of a benefit to 
an individual mentally incompetent or under other legal disability 
would cause substantial harm to the individual, the Office may defer or 
suspend direct payment of the benefit until such time as the 
appointment of a representative payee is made.''.
            (2) FERS.--Section 8466(c) of title 5, United States Code, 
        is amended--
                    (A) by inserting ``(1)'' after ``(c)'';
                    (B) in the first sentence, by inserting 
                ``(including an organization)'' after ``person'';
                    (C) in the second sentence--
                            (i) by inserting ``(including an 
                        organization)'' after ``any person''; and
                            (ii) by inserting ``and may appropriately 
                        receive such payments on behalf of the 
                        claimant'' after ``claimant''; and
                    (D) by adding at the end the following:
    ``(2) If the Office determines that direct payment of a benefit to 
an individual mentally incompetent or under other legal disability 
would cause substantial harm to the individual, the Office may defer or 
suspend direct payment of the benefit until such time as the 
appointment of a representative payee is made.''.
    (d) Limitations on Appointments of Representative Payees.--
            (1) CSRS.--Section 8345 of title 5, United States Code, is 
        amended by inserting after subsection (e) the following:
    ``(f) The Office may not authorize a person to receive payments on 
behalf of a minor or individual of legal disability under subsection 
(e) if that person has been convicted of a violation of--
            ``(1) section 8345a or 8466a;
            ``(2) section 208 or 1632 of the Social Security Act (42 
        U.S.C. 408 and 1383a); or
            ``(3) section 6101 of title 38.''.
            (2) FERS.--Section 8466 of title 5, United States Code, is 
        amended by adding at the end the following:
    ``(d) The Office may not authorize a person to receive payments on 
behalf of a minor or individual of legal disability under subsection 
(c) if that person has been convicted of a violation of--
            ``(1) section 8345a or 8466a;
            ``(2) section 208 or 1632 of the Social Security Act (42 
        U.S.C. 408 and 1383a); or
            ``(3) section 6101 of title 38.''.

SEC. 3. IMPLEMENTATION.

    (a) Authorization of Payments.--Amounts in the Civil Service 
Retirement and Disability Fund may be used by the Office of Personnel 
Management, without further appropriation, for the cost of activities 
of the Office relating to preventing fraud by representative payees (as 
defined in section 8331 and 8401 of title 5, United States Code, as 
amended by this Act).
    (b) Regulations.--Not later than 1 year after the date of enactment 
of this Act, the Office of Personnel Management--
            (1) shall promulgate regulations to carry out the 
        amendments made by this Act; and
            (2) may promulgate additional regulations relating to the 
        administration of the representative payee program.

SEC. 4. EFFECTIVE DATE.

    The amendments made by this Act--
            (1) shall take effect on the date of the enactment of this 
        Act; and
            (2) apply on and after the effective date of the 
        regulations promulgated under section 3(b)(1).
                                 <all>