The Direct Express® program offered by the U.S. Department of the Treasury allows “representative payees” – also called “VA fiduciaries” by the Department of Veterans Affairs (VA) – to manage funds on behalf of beneficiaries.
A representative payee or VA fiduciary is an individual appointed by a federal paying agency to receive and manage the benefits of someone who is unable to manage their finances independently. Generally, paying agencies will look for family or friends to serve as payees. When friends or family members are not able to serve as payees, qualified organizations might serve in the role.
Representative payees or VA fiduciaries typically act for beneficiaries who are incapacitated adults, or individuals deemed incapable of managing their funds due to physical or mental limitations.
Representative payees typically have the following capabilities and responsibilities:
- Authorization and Designation: Appointing a representative payee is usually done through a formal process with the respective federal agency administering the benefits, such as the Social Security Administration (SSA) or the Department of Veterans Affairs (VA) The payee is authorized to receive and manage the beneficiary’s payments.
- Payee Identification: When a representative payee or VA fiduciary is appointed, they provide their own contact information and address to the federal agency. For a Direct Express® card account, a profile and physical card are set up in the name of the representative payee or VA fiduciary who is “in care of” the payee receiving the benefits. The payment method for the beneficiary remains the same, and the funds are loaded onto the Direct Express® card for the representative payee or VA fiduciary to use.
- Card Management: The representative payee has the responsibility of managing the beneficiary’s funds through Direct Express® to meet their needs and requirements. This includes using the Direct Express® card to make purchases, pay bills, and withdraw cash on behalf of the beneficiary.
- Record Keeping: Representative payees are required to keep accurate records of how they use the beneficiary’s funds. This is done to ensure that the funds are being used for the benefit and well-being of the beneficiary. The federal paying agency overseeing these benefit payments may request periodic reports or audits from the payee.
- Account Access: The representative payee or VA fiduciary has access to the beneficiary’s Direct Express® account to monitor balances, transactions, and manage the funds effectively. They can use the Direct Express DX℠ Mobile App to manage the account and may utilize its built-in option to manage more than one card, if necessary. They can also access 24/7 customer service support for any account-related questions or issues and use the Direct Express® Financial Education Center to improve their money management skills and understanding.
- Legal Responsibility: Representative payees have a legal obligation to act in the best interest of the beneficiary. They must use the funds to meet the beneficiary’s basic needs, such as housing, food, clothing, and medical care.
Representative payees or VA fiduciaries play an important role in ensuring access and proper management of the federal benefits disbursed via Direct Express®.
A useful and informative guide for representative payees or VA fiduciaries is available from the Consumer Financial Protection Bureau (CFPB):
SOURCE: Direct Express®