[Federal Register Volume 68, Number 176 (Thursday, September 11, 2003)]
[Rules and Regulations]
[Pages 53506-53509]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-23134]


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SOCIAL SECURITY ADMINISTRATION

20 CFR Part 416

RIN 0960-AF43


Access to Information Held by Financial Institutions

AGENCY: Social Security Administration.

ACTION: Final rule.

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SUMMARY: We are revising our regulations to implement a law that will 
enhance our access to financial account information of Supplemental 
Security Income (SSI) applicants and recipients and other individuals 
whose income and resources we consider as being available to the 
applicant or recipient.

EFFECTIVE DATE: These regulations are effective October 14, 2003.

FOR FURTHER INFORMATION CONTACT: Martin Sussman, Regulations Officer, 
Office of Regulations, 100 Altmeyer Building, Social Security 
Administration, 6401 Security Boulevard, Baltimore, MD 21235-6401, 
[email protected], (410) 965-1767 or TTY (410) 966-5609 for 
information about these rules. For information on eligibility or 
claiming benefits, call our national toll-free numbers, 1-800-772-1213 
or TTY 1-800-325-0778 or visit our Internet Web site, Social Security 
Online, at http://www.socialsecurity.gov/.
    Electronic Version: The electronic file of this document is 
available on the date of publication in the Federal Register on the 
Internet site for the Government Printing Office: http://www.access.gpo.gov/su_docs/aces/aces140.html. It is also available on 
our Internet site, Social Security Online: http://www.socialsecurity.gov/regulations.

SUPPLEMENTARY INFORMATION:

[[Page 53507]]

Background

    Section 1631(e)(1)(B) of the Social Security Act (the Act) requires 
the Commissioner of Social Security to verify all relevant information 
provided regarding the eligibility of SSI applicants and recipients. 
Section 213 of the Foster Care Independence Act of 1999, Public Law 
106-169, amended section 1631(e)(1)(B) of the Act to grant the 
Commissioner new authority with respect to verifying financial 
accounts. Under section 213, the Commissioner may require each SSI 
applicant or recipient to provide us with permission to obtain any 
financial record (as defined in section 1101(2) of the Right to 
Financial Privacy Act) held by any financial institution (as defined in 
section 1101(1) of the Right to Financial Privacy Act) with respect to 
the applicant or recipient. This law also allows the Commissioner to 
require such permission from deemors (i.e. individuals whose income and 
resources we consider as being available to the applicant or 
recipient).
    This law requires us to tell you, or any other person whose income 
and resources we consider as being available to you, how we will use 
the permission and how long the permission lasts. It also allows us to 
request the information from financial institutions without furnishing 
a copy of the permission to the financial institution. We may request 
the information from financial institutions at any time we think it is 
needed to determine your eligibility or payment amount. Requests under 
this provision are considered to meet the requirements of the Right to 
Financial Privacy Act regarding identification and description of the 
financial record to be disclosed.
    This law also allows us to deny your SSI eligibility or suspend 
your SSI eligibility if you, or any person whose income and resources 
we consider as being available to you, refuses to provide or cancels 
the permission.

Explanation of Changes

    The Commissioner is exercising her authority under section 213 of 
the Foster Care Independence Act of 1999 by promulgating new rules to 
make giving permission to contact financial institutions a condition of 
SSI eligibility. Therefore, we are amending our regulations by adding a 
new section Sec.  416.207 to explain that in order to receive SSI 
benefits, you must give us permission to contact any financial 
institution, and request any financial records that financial 
institution may have for you. The section further explains that the 
permission to contact financial institutions is required from anyone 
whose income and resources we consider as being available to you, 
unless there is good cause why the permission cannot be obtained. This 
section also explains that the permission to contact financial 
institutions lasts until one of the following terminating events occur:
    (1) You cancel the permission in writing and provide the writing to 
us.
    (2) The deemor cancels their permission in writing and provides the 
writing to us.
    (3) The basis on which we consider a deemor's income and resources 
available to you ends, e.g. when spouses separate or divorce or a child 
attains age 18.
    (4) Your application for SSI is denied, and the denial is final. A 
denial is final when made, unless you appeal the denial timely as 
described in Sec. Sec.  416.1400 through 416.1499.
    (5) You are no longer eligible for SSI as described in Sec. Sec.  
416.1331 through 416.1335.
    This section explains that we will ask financial institutions for 
this information when we think that it is necessary to determine SSI 
eligibility and payment amount. This section defines a financial 
institution as any bank, savings bank, credit card issuer, industrial 
loan company, trust company, savings association, building and loan, 
homestead association, credit union, consumer finance institution, or 
any other financial institution as defined in section 1101(1) of the 
Right to Financial Privacy Act. The section also defines a financial 
record as an original of, a copy of, or information known to have been 
derived from any record held by the financial institution pertaining to 
your relationship with the financial institution.
    In addition, we are revising current Sec.  416.200 to add the new 
section Sec.  416.207 as a reference, to redesignate current Sec.  
416.1321 as Sec.  416.1320, and to add a new section Sec.  416.1321, 
``Suspension for not giving us permission to contact financial 
institutions,'' to Subpart M as a reason for suspending SSI benefits.

Public Comments

    On May 2, 2002, we published proposed rules in the Federal Register 
at 67 FR 22021 and provided a 60-day period for interested parties to 
comment. We received comments from ten organizations and four 
individuals. Because some of the comments received were quite detailed, 
we have condensed, summarized or paraphrased them in the discussion 
below. We address all of the significant issues raised by the 
commenters that are within the scope of the proposed rules. We have 
made revisions to the proposed rules to address some of the concerns of 
the commenters.
    Comment: Ten organizations submitted comments regarding the fact 
that deemors (i.e. individuals whose income and resources we consider 
as being available to the applicant or recipient) are required to 
provide us with permission to obtain any financial record held by any 
financial institution with respect to the deemor as a condition of the 
applicant's or recipient's eligibility. Specifically, these 
organizations stated that we should provide a good cause exception for 
applicants and recipients who act in good faith to obtain the 
permission from the deemor, but are unable to do so through no fault of 
their own. In addition, six organizations stated that we should provide 
a good cause exception from this third party requirement for applicants 
and recipients who are victims of domestic violence. These 
organizations believe that it is improper to deny or suspend benefits 
because of the actions of a third party.
    Response: After careful consideration, we have decided to include a 
limited good cause exception. We believe a good cause exception is 
warranted because it is consistent with our current policy. Good cause 
might exist in cases where the applicant or recipient cannot obtain 
permission from a deemor to access their financial records because the 
deemor is harassing, abusing, or endangering the life of the applicant 
or recipient. Good cause may also exist in cases where the applicant or 
recipient acts in good faith to obtain the permission from certain 
deemors, but is unable to do so through no fault of their own. We have 
revised Sec. Sec.  416.207 (g) and 416.1321(a), and added Sec.  
416.207(h) to include the good cause exception. These provisions are 
consistent with our current policy regarding a third party's failure to 
cooperate.
    In Sec.  416.207(h)(3) we explain that good cause does not apply if 
certain deemors (i.e. someone whose income and resources we consider as 
available to you) refuse to give us permission to access their 
financial records. It is our long-standing policy to deny an applicant 
benefits or suspend a recipient's benefits if the applicant or 
recipient's prospective or appointed representative payee, who is also 
the legal guardian or parent with custody of a minor child, or if an 
alien's sponsor or sponsor's living-with spouse, fails to provide 
requested information. In these situations, the legal guardian or

[[Page 53508]]

custodial parent stands in the shoes of a legally incompetent 
individual. The sponsor of an alien likewise has taken on a special 
obligation with respect to the alien by signing an affidavit of 
support. It is these special legal statuses that distinguish these 
deemors from others.
    Refusal on the part of a parent or legal guardian to comply with an 
authorization request from us is the same as the applicant or recipient 
themselves refusing to comply. In the sponsor's situation, a refusal to 
comply would be inconsistent with their obligation under the affidavit 
to support the recipient and could undermine the intent of the 
affidavit of limiting the expenditure of public funds. Thus, the good 
cause exception is not designed to address such situations, but instead 
is intended primarily for the situation of a married recipient whose 
uncooperative spouse lives in the same household but does not stand in 
the shoes of the recipient nor does the spouse have a delineated 
obligation of support. However, if a deemor as outlined in Sec.  
416.207(h)(3) refuses to provide us access to his or her financial 
records, we would not find good cause for such a refusal.
    Comment: Two organizations submitted comments recommending that we 
revise our language when we refer to ``anyone whose income and 
resources we consider as being available to you.'' The organizations 
believe that it would be useful to insert language, which states that 
deeming situations are the only circumstances when third party 
permission will be required.
    Response: While we did not adopt this suggestion, we made a 
clarification to show that the individuals in question are deemors. We 
believe the language used is appropriate and is consistent with the 
language in section 213 of the Foster Care Independence Act of 1999. In 
the background section we state that ``individuals whose income and 
resources we consider as being available to the applicant or 
recipient'' are deemors and the words ``i.e. deemors,'' were inserted 
in Sec.  416.207(a).
    Comment: Two organizations stated that we should include a 
provision that states that the permission we obtain to access the 
financial records of third parties (i.e. deemors) will terminate when 
deeming is no longer required.
    Response: We are adopting this suggestion. The regulation states 
that ``you must also provide us with permission from anyone whose 
income and resources we consider as being available to you, i.e., 
deemors (see Sec. Sec.  416.1160, 416.1202, 416.1203, and 416.1204).'' 
We have revised Sec.  416.207(f) and added Sec.  416.207(f)(3) to 
clarify that the permission we obtain to access the financial records 
of deemors will terminate when deeming is no longer required and to 
clarify that when a terminating event occurs, the permission to contact 
financial institutions is not invalidated for past periods. We have 
also made slight editorial changes to the language in Sec. Sec.  
416.207(a) and (g) for purposes of grammatical consistency.

Regulatory Procedures

Executive Order 12866

    The Office of Management and Budget (OMB) has reviewed these final 
regulations in accordance with Executive Order 12866, as amended by 
Executive Order 13258.

Regulatory Flexibility Act

    We certify that these final regulations will not have a significant 
economic impact on a substantial number of small entities because they 
affect only individuals. Therefore, a regulatory flexibility analysis 
as provided in the Regulatory Flexibility Act, as amended, is not 
required.

Paperwork Reduction Act

    These final rules contain reporting requirements at Sec.  416.207 
and Sec.  416.1321. We solicited comments on these requirements on May 
2, 2002 in proposed rules published in the Federal Register at 67 FR 
22021 and provided a 60-day period for interested parties to comment. 
Based on comments received, we have made revisions to the proposed 
rules to address some of the concerns of the commenters (see Public 
Comments section). However, these revisions did not alter the reporting 
requirements imposed on the public in the final rule.
    The public reporting burden is accounted for in the Information 
Collection Requests for the various forms that the public uses to 
submit the information to SSA. Consequently, a 1-hour placeholder 
burden is being assigned to the specific reporting requirement(s) 
contained in these rules. The forms used to collect this information 
will not change as a result of this rule.
    An Information Collection Request has been submitted to OMB. We 
will publish a notice in the Federal Register upon OMB approval of the 
information collection requirement(s).

(Catalog of Federal Domestic Assistance Program No. 96.006, 
Supplemental Security Income)

List of Subjects in 20 CFR Part 416

    Administrative practice and procedure, Aged, Blind, Disability 
benefits, Public Assistance programs, reporting and recordkeeping 
requirements, Supplemental Security Income (SSI).

    Dated: July 11, 2003.
Jo Anne B. Barnhart,
Commissioner of Social Security.

0
For the reasons set out in the preamble, we are amending part 416, 
subparts B and M of chapter III, title 20, Code of Federal Regulations 
to read as follows:

PART 416--SUPPLEMENTAL SECURITY INCOME FOR THE AGED, BLIND, AND 
DISABLED

Subpart B--[Amended]

0
1. The authority citation for Subpart B of part 416 continues to read 
as follows:

    Authority: Secs.702(a)(5), 1110(b), 1602, 1611, 1614, 1615(c), 
1619(a), 1631, and 1634 of the Social Security Act (42 U.S.C. 
902(a)(5), 1310(b), 1381a, 1382, 1382c, 1382d(c), 1382h(a), 1383, 
and 1383c); secs. 211 and 212, Pub. L. 93-66, 87 Stat. 154 and 155 
(42 U.S.C. 1382 note); sec. 502(a), Pub. L. 94-241, 90 Stat. 268 (48 
U.S.C. 1681 note); sec. 2, Pub. L. 99-643, 100 Stat. 3574 (42 U.S.C. 
1382h note).


0
2. Revise the last sentence of Sec.  416.200 to read as follows:


Sec.  416.200  Introduction.

    * * * You continue to be eligible unless you lose your eligibility 
because you no longer meet the basic requirements or because of one of 
the reasons given in Sec. Sec.  416.207 through 416.216.

0
3. Add a new Sec.  416.207 under the undesignated center heading 
REASONS WHY YOU MAY NOT GET SSI BENEFITS FOR WHICH YOU ARE OTHERWISE 
ELIGIBLE, to read as follows:


Sec.  416.207  You do not give us permission to contact financial 
institutions.

    (a) To be eligible for SSI payments you must give us permission to 
contact any financial institution and request any financial records 
that financial institution may have about you. You must give us this 
permission when you apply for SSI payments or when we ask for it at a 
later time. You must also provide us with permission from anyone whose 
income and resources we consider as being available to you, i.e., 
deemors (see Sec. Sec.  416.1160, 416.1202, 416.1203, and 416.1204).
    (b) Financial institution means any:
    (1) Bank,
    (2) Savings bank,
    (3) Credit card issuer,
    (4) Industrial loan company,
    (5) Trust company,
    (6) Savings association,

[[Page 53509]]

    (7) Building and loan,
    (8) Homestead association,
    (9) Credit union,
    (10) Consumer finance institution, or
    (11) Any other financial institution as defined in section 1101(1) 
of the Right to Financial Privacy Act.
    (c) Financial record means an original of, a copy of, or 
information known to have been derived from any record held by the 
financial institution pertaining to your relationship with the 
financial institution.
    (d) We may ask any financial institution for information on any 
financial account concerning you. We may also ask for information on 
any financial accounts for anyone whose income and resources we 
consider as being available to you (see Sec. Sec.  416.1160, 416.1202, 
416.1203, and 416.1204).
    (e) We ask financial institutions for this information when we 
think that it is necessary to determine your SSI eligibility or payment 
amount.
    (f) Your permission to contact financial institutions, and the 
permission of anyone whose income and resources we consider as being 
available to you, i.e., a deemor (see Sec. Sec.  416.1160, 416.1202, 
416.1203, and 416.1204), remains in effect until a terminating event 
occurs. The following terminating events only apply prospectively and 
do not invalidate the permission for past periods.
    (1) You cancel your permission in writing and provide the writing 
to us.
    (2) The deemor cancels their permission in writing and provides the 
writing to us.
    (3) The basis on which we consider a deemor's income and resources 
available to you ends, e.g. when spouses separate or divorce or a child 
attains age 18.
    (4) Your application for SSI is denied, and the denial is final. A 
denial is final when made, unless you appeal the denial timely as 
described in Sec. Sec.  416.1400 through 416.1499.
    (5) You are no longer eligible for SSI as described in Sec. Sec.  
416.1331 through 416.1335.
    (g) If you don't give us permission to contact any financial 
institution and request any financial records about you when we think 
it is necessary to determine your SSI eligibility or payment amount, or 
if you cancel the permission, you cannot be eligible for SSI payments. 
Also, except as noted in paragraph (h), if anyone whose income and 
resources we consider as being available to you (see Sec. Sec.  
416.1160, 416.1202, 416.1203, and 416.1204) doesn't give us permission 
to contact any financial institution and request any financial records 
about that person when we think it is necessary to determine your 
eligibility or payment amount, or if that person cancels the 
permission, you cannot be eligible for SSI payments. This means that if 
you are applying for SSI payments, you cannot receive them. If you are 
receiving SSI payments, we will stop your payments.
    (h) You may be eligible for SSI payments if there is good cause for 
your being unable to obtain permission for us to contact any financial 
institution and request any financial records about someone whose 
income and resources we consider as being available to you (see 
Sec. Sec.  416.1160, 416.1202, 416.1203, and 416.1204).
    (1) Good cause exists if permission cannot be obtained from the 
individual and there is evidence that the individual is harassing you, 
abusing you, or endangering your life.
    (2) Good cause may exist if an individual other than one listed in 
paragraph (h)(3) of this section refuses to provide permission and: you 
acted in good faith to obtain permission from the individual but were 
unable to do so through no fault of your own, or you cooperated with us 
in our efforts to obtain permission.
    (3) Good cause does not apply if the individual is your 
representative payee and your legal guardian, if you are a minor child 
and the individual is your representative payee and your custodial 
parent, or if you are an alien and the individual is your sponsor or 
the sponsor's living-with spouse.

Subpart M--[Amended]

0
4. The authority citation for subpart M of part 416 continues to read 
as follows:

    Authority: Secs. 702(a)(5), 1129A, 1611-1615, 1619, and 1631 of 
the Social Security Act (42 U.S.C. 902(a)(5), 1382-1382d, 1382h, 
1383 and 1320a-8a).

0
5. Redesignate Sec.  416.1321 as Sec.  416.1320 and add new Sec.  
416.1321 to read as follows:


Sec.  416.1321  Suspension for not giving us permission to contact 
financial institutions.

    (a) If you don't give us permission to contact any financial 
institution and request any financial records about you when we think 
it is necessary to determine your SSI eligibility or payment amount, or 
if you cancel the permission, you cannot be eligible for SSI payments 
(see Sec.  416.207) and we will stop your payments. Also, if anyone 
whose income and resources we consider as being available to you (see 
Sec. Sec.  416.1160, 416.1202, 416.1203 and 416.1204) doesn't give us 
permission to contact any financial institution and request any 
financial records about that person when we think it is necessary to 
determine your SSI eligibility or payment amount, or that person 
cancels the permission, you cannot be eligible for SSI payments and we 
will stop your payments. We will not find you ineligible and/or stop 
your payments if the person whose income and resources we consider as 
being available to you fails to give or continue permission and good 
cause, as discussed in Sec.  416.207(h), exists.
    (b) We will suspend your payments starting with the month after the 
month in which we notify you in writing that:
    (1) You failed to give us permission to contact any financial 
institution and request any financial records about you, or
    (2) The person(s) whose income and resources we consider as being 
available to you failed to give us such permission.
    (c) If you are otherwise eligible, we will start your benefits in 
the month following the month in which:
    (1) You give us permission to contact any financial institution and 
request any financial records about you, or
    (2) The person(s) whose income and resources we consider as being 
available to you gives us such permission.

0
6. Revise references from ``Sec.  416.1321'' to read ``Sec.  416.1320'' 
in the following sections:
    a. Sec.  416.421(a);
    b. Sec.  416.640(e)(5)(iii);
    c. Sec.  416.1231(b)(9);
    d. Sec.  416.1242(d);
    e. Sec.  416.1245(b)(5);
    f. Sec.  416.1247(b);
    g. Sec.  416.1335;
    h. Sec.  416.1337(b)(3)(ii);
    i. Sec.  416.1618(d)(3)(i);
    j. Sec.  416.1618(d)(3)(ii); and
    k. Sec.  416.1618(d)(3)(iv).

[FR Doc. 03-23134 Filed 9-10-03; 8:45 am]
BILLING CODE 4191-02-P