By Marshall Kofler, Office of Legislative and Public Affairs
The Korea Credit Information Association visited the Financial Management Service (FMS) to meet with representatives of FMS's Debt Management Services (DMS) program this past July.
During the visit, the FMS Office of Legislative and Public Affairs (LPA) provided a briefing on the primary FMS business lines:
Issuing U.S. federal government payments in its capacity as the U.S. government's central disbursing agency.
Processing U.S. federal government financial collections and manages the world's largest collections program.
Providing the centralized government-wide accounting and reporting function for the U.S. federal government, including maintaining the U.S. government's books, overseeing the central accounting and reporting system, and keeping track of U.S. federal government operating cash and monetary assets.
Collecting delinquent U.S. federal government debt, under the Debt Collection Improvement Act (DCIA) of 1996, which centralized the collection of delinquent non-tax debt owed to the U.S. federal government and gave the U.S. Treasury Department responsibilities for collecting this debt.
Focus on the FMS Debt Collection Program
The primary focus of the Korea Credit Information Association was the FMS debt collection program. Ronda Kent, (then) Acting Deputy Assistant Commissioner for DMS and Richard Burnham, Director of the DMS Private Collection Division, briefed the group on the history of the debt program and key aspects of the program. Key topics included:
Treasury Offset Program (TOP) – Compares the names and taxpayer identification numbers (TINs) of debtors with the names and TINs of recipients of federal and some state payments and if there is a match, the payment is reduced (or "offset") to satisfy the debt.
Cross Servicing Program – Federal agencies refer delinquent non-tax debt to FMS for collection by means of a variety of tools, including offset, demand letters to debtors, repayment agreements, administrative wage garnishment, referrals to the U.S. Department of Justice, credit bureau reporting, and the use of Private Collection Agencies (PCAs).
FMS has used PCAs to collect delinquent debt since 1998, working with them to utilize their expertise in locating debtors, establishing payment agreements, and administratively resolving debts.
Other debt management initiatives and issues.
The visit was arranged as part of the FMS International Program. FMS frequently hosts international delegations to provide information and technical assistance in areas related to the bureau's role as the U.S. government's central financial manager.
To learn more about FMS's International Program, contact Marshall Kofler, Deputy Director, LPA at (202) 874-0966.