DCL-05-26, DFAS Restitution Letters

DEAR COLLEAGUE LETTER

DCL-05-26

DATE: September 6, 2005

TO: ALL STATE IV-D DIRECTORS

RE: DFAS Restitution Letters

Dear Colleague:

This letter is to provide you with additional information regarding the Defense Finance and Accounting Service (DFAS) restitution letters your state may have recently received. We are pleased to inform you that DFAS has provided us with revised procedures to request a waiver.

Background

During the past few months, state disbursement units (SDUs) and individual counties have received letters from DFAS asking for restitution of certain child support payments sent between 1999 and 2003. Pursuant to an internal DFAS audit, it was determined that these payments had been made on behalf of Navy service members who were no longer in the service when the payments were made.

The Federal Office of Child Support Enforcement (OCSE) has been working with DFAS to resolve this matter. OCSE discussed the situation with the Assistant General Counsel, Garnishment Operations and others at DFAS. We explained that Federal regulations require states to disburse child support payments to the custodial families within two business days and it was unlikely that these funds would still be available to return to DFAS. DFAS gave us instructions for states to request a waiver from repayment of these monies (see Dear Colleague Letter DC-05-16 of June 15, 2000).

Since that time several states have indicated that they are unable to follow these instructions because the bulk of the DFAS restitution letters have gone to counties rather than the SDUs. (The SDUs were not set up at the time the overpayments occurred.) DFAS would need to provide these states with a list of the letters (payments) in order for the states to comply with DFAS’s original instructions. Therefore DFAS has provided revised instructions.

Revised Instructions

Write a letter on SDU or county letterhead to:

Defense Finance and Accounting Service
Attention: Roger J. Pinta Director, Disbursing Operations
1240 East Ninth Street
Cleveland, OH 44199
If your state/county still has the funds (e.g., as part of state undistributed collections), return the funds by paper check to DFAS with remittance information for each NCP’s payment(s).
If your state/county does not have the funds, explain that the child support payment received from DFAS was owed by the NCP (Navy service member), credited to their child support obligation(s), and disbursed to the custodial family. Affirm that, therefore, your SDU or county is unable to return the payment(s).

If you have any questions, please contact Nancy Benner at (202) 401-5528 or nbenner@acf.hhs.gov.

Sincerely,

Margot Bean
Commissioner
Office of Child Support Enforcement

cc: Regional Office Program Managers
ACF Regional Administrators
SDU contacts
State EFT/EDI contacts