Rep payee

I don't like this practice, but we issue debit cards on rep payee accounts. Surprise, surprise, a rep payee account is not overdrawn. We have a feeling that the direct deposit to the account will be cancelled and will end up charging off the account.

Who do we report to Chexsystems? Since the rep payee is the fiduciary, would I report him/her? Or since the beneficiary benefits from the account (and according to rep payee the beneficiary is the one that OD the account) do I report him/her?

Can I report either? Neither? Help!

and according to rep payee the beneficiary is the one that OD the account

That's funny, if there is a Rep Payee, the beneficiary is not suppose to have any access to the account. I would give them their required notice of account closure, right after the next deposit and revoke the card the same day and move on.

I know. I am already working on shutting the card and account down.

But if we do take a loss, who can we report? My thought is the rep payee?

Report the Rep Payee, not the protected person. If this involves an elderly person, I would follow any state laws involving notice of elder abuse.

Regardless of whether the beneficiary somehow accessed the account, it remains that the Rep Payee was the party responsible for the account's activity. If you are going to file a ChexSystems report, list the Rep Payee, not the beneficiary.

Going forward, review your bank's procedures on issuing cards for Rep Payee accounts. Ensure that you will not issue a card to the beneficiary in such situations. If you find that you must issue a card to a Rep Payee, do so only after making it clear that it is not to be used by the beneficiary.