Actioning third party debts 107-04010100
This document outlines how to investigate and action a third party debt, which results from a request for refund of payment/s made to an incorrect account or recipient, and the financial institution has not returned funds to the agency.
Requesting a refund from a third party
Where a third party receives a payment they are not entitled to, they are responsible for repaying this amount. This includes when Centrelink payment/s have been incorrectly paid to a third party's account, including a joint account.
If attempts to request a refund from the financial institution have not been successful in recalling payment/s made to an incorrect bank account or recipient, at the end of the 28 day review period the system will generate a debt on the customer’s record.
Investigation of the debt is required to confirm who received the funds, which will determine the liable party/parties for raising the debt.
If the agency pays Paid Parental Leave (PPL) funds intended for an employer into an incorrect account, see Delivery of Parental Leave Pay (PPL).
See the Resources page for Debt and Compensation (DCP) Branch and Payment and Recovery Operations Division (PAROD) contact details.
Suspected fraud
There is an increased risk to the agency that customers can become the victims of fraud themselves. Be aware of any previous information received that could indicate unauthorised access to a customer’s information or payments.
Where a customer disputes a debt saying they never received the related payment, this can be an indicator of fraud. For example:
- the customer's payment was redirected without their knowledge and they were only made aware when they received the debt advice, or
- the customer says they never opened the bank account in their name when bank evidence shows they did
See Identity fraud.
Third party withdraws funds after customer's death
No action is required from the agency if money is sent to the customer’s correct account but was later withdrawn/transferred by a third party without authority. This needs to be pursued by the estate. See Requesting refunds and raising debts for deceased customer.
Child Care Subsidy (CCS)
CCS request for refunds are completed manually. See Reissue a payment or cheque at a customer's request.
The Resources page has the contact details, external contact details, a link to the Commonwealth Victim’s Certificate and documentation templates.
Related links
Processing the returned payment
Adding a customer to the system
Creating a new organisation debt record on the Debt Management and Information System (DMIS)
Requesting refunds and raising debts for deceased customer
Request the return of a payment made to an incorrect recipient
Reissue a payment or cheque at a customer's request
Reissue a payment returned from a financial institution – includes deceased customers
Recalled payments not received by Services Australia
Delivery of Parental Leave Pay (PPL)
Requests for information after someone has died
Finalised 'no debt' (FND) or 'zeroing' debts that are not legally recoverable
Create a new debt record manually on the Debt Management and Information System (DMIS)