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Title: Bank's New England Customers See Delay in Social Security Checks

Summary: Apr. 7 (Providence Journal/KRTBN)--More than 600 Social Security checks that were supposed to be electronically deposited into the accounts of Sovereign Bank New England customers in Rhode Island and Connecticut may arrive up to a week late.

Source: Knight Ridder Open LINK

Story Filed: Friday, April 07, 2000 3:49 AM EST

Apr. 7 (Providence Journal/KRTBN)--More than 600 Social Security checks that were supposed to be electronically deposited into the accounts of Sovereign Bank New England customers in Rhode Island and Connecticut may arrive up to a week late.

The delay was blamed on a "glitch" in the transfer of government funds to the new bank.

Officials at the Social Security Administration yesterday confirmed that Sovereign customers who were supposed to receive their monthly direct-deposit Social Security checks on Monday may not get them until today or possibly next Monday.

The payments will arrive late because the Treasury Department, which cuts the Social Security checks, didn't get Sovereign's new nine-digit identification code, or "routing number," in time to cut the electronic checks that were due Monday.

Instead, the electronic transfer was initally tagged "invalid" and the payments were returned to the Social Security Administration, according to a Treasury Department official in Washington.

Monthly Social Security checks are often a life-line for retirees, who rely on their timely receipt to pay basic expenses such as food and rent.

One Sovereign customer, who asked not to be identified, said that when his check didn't arrive on Monday, he was forced to cash in more than $600 in bonds that he and his wife had been saving in order to pay his federal and state income taxes.

The Social Security Administration office in Providence is offering to cut checks immediately for any Sovereign customers who have a "dire need" for the money, said John L. Holder, assistant manager of the Social Security Administration in Providence.

Sovereign "apologize(s) for the delay," and expects the problem to be resolved by Monday, said Shelly McPhee, of Sovereign's public relations firm, GPC/O'Neill & Associates in Boston.

McPhee said the 609 direct-deposit Social Security checks which have been held up are out of 43,000 such checks that have direct deposit in Rhode Island and Connecticut.

Sovereign, which opened for business on March 27, acquired approximately 800,000 accounts of BankBoston customers in Rhode Island, Connecticut and Western Massachusetts.

The customers with the problem checks were the ones who followed the instructions in Sovereign's products and services guide. The red guide, sent to all new customers, instructs people with direct-deposit payments to ensure their checks will be properly deposited by filling out a form and notifying the Social Security Administration of the bank's new routing number.

Customers who didn't follow Sovereign's directions didn't have the same problem with their Social Security checks.

"There was just a glitch in the system which we believe has been resolved," said Kurt Czarnowski, a spokesman for the Social Security Administration in Boston.

It's unclear who was to blame for the delay in getting Sovereign's new routing number to the Treasury Department.

The Treasury Department is notified of a bank's new routing numbers either by the Federal Reserve system, the Social Security Administration or the bank itself, said Macey Blue, of the Treasury Department in Washington.

In Sovereign's case, after the Social Security payments were returned to the Social Security Administration, the Treasury contacted the Federal Reserve Bank in Richmond, Va. and on March 27 confirmed the bank's new routing number.

By then, however, it was too late to update the files, she said.

Officials at the Treasury and Social Security Administration say this

type of mixup is not the norm.

"This is not common at all," said Czarnowski.

"Generally we encourage folks to use electronic funds transfer because that's the single best protection against lost or missed payments," Czarnowski said. "The incidence of lost or missed payments with electronic funds transfer is far far far less than when you're dealing with paper checks."

Sovereign customers who haven't received their Social Security checks and need the money to live on can call the Providence Social Security Administration at 528-4501 or 1-800-772-1213.

To receive special payments, they must fill out a form at the Social Security Administration office at 380 Westminster St., 3rd floor, Providence.

By Lynn Arditi

(c) 2000, Providence Journal, R.I. Distributed by Knight Ridder/Tribune Business News.

http://library.northernlight.com/FA20000407490000296.html?cb=200&dx=2006&sc=0#doc

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-- (Dee360Degree@aol.com), April 07, 2000