Hold on SS Check Deposited into Joint Account

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Question:

Can the bank place a hold on the anticipated amount of a future social security deposit after a joint owner of a DDA passes away? They were entitled to the previous months deposit, but will not be entitled to future deposits.

Answer:

An anticipatory hold would have the effect of holding current funds in the account, wouldn't it? You can't hold what isn't already there.

What you should do is flag the account to return the SSA payment, if your system can do it for you. If not, you can identify the date the funds should arrive and simply take those funds and return the ACH entry on the settlement date. Just be very careful that you don't send back an SSA deposit for the other joint owner, if he or she also gets SSA payments.

Don't be surprised if the expected payment doesn't ever show up. SSA is very efficient at preventing payments from going out if they receive the required notice from a funeral services provider quickly enough.

First published on BankersOnline.com 10/25/10