Judicial Branch

Improving Collection of Unpaid Debts Owed to the United States

The federal government has a centralized program to collect unpaid debts owed to the United States (and past-due child support) that is administered by the Treasury's Financial Management Service. In general, before money is paid from an account at the Treasury to a payee, the payment passes through FMS' Treasury Offset Program where a disbursing official compares the payment information with debtor information on file with the Treasury. If the payee owes money to the United States, or owes unpaid child support, the planned payment is offset against the debt. Any amount offset is transferred to the agency (or person in the case of unpaid child support) owed the unpaid debt. In FY 2009, this program collected approximately $3.8 billion.


The TOP program could be even more effective if all payments processed from any account at Treasury as well as all payments ordered or approved by any instrumentality of the federal government, such as a court or a federal agency, were required to be cleared through TOP. For example, payments to payees in federal class action litigation are not processed through TOP because the federal judiciary does not generally participate in TOP.


The judiciary should process through TOP payments to payees from court registry accounts held at the Treasury where the amount of the proposed payment would justify the expense associated with participating in the TOP program. Also, to the extent the judiciary or any federal agency or instrumentality uses a non-Treasury disbursement process to make a payment such as a receiver or third-party administrator, the judiciary, federal agency or instrumentality should order or otherwise require the non-Treasury disbursing agent to process proposed payments through TOP if the amount of the proposed payments would justify the expense associated with participating in the TOP program.



4 votes
Idea No. 15530