Our company is representative payee of social security benefits for several clients that are developmentally disabled. Some of these clients have jobs where they receive their own paycheck. We are not considered the payee for those checks. The bank will not let them open a separate savings account for their wages because they have the representative payee account, but their paychecks cannot be put in representative payee account. Is the bank in the wrong?
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Yes and no. The bank is incorrect to assume that the paychecks can be deposited to the representative payee account. That's not permitted. However, the bank can refuse to open an account for anyone without breaking any rules.
Perhaps the bank believes that having a representative payee means that the recipient is legally incompetent, which would mean the bank could not open an account for them directly. However, there is no direct connection between the two concepts.
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Yes and no. The bank is incorrect to assume that the paychecks can be deposited to the representative payee account. That's not permitted. However, the bank can refuse to open an account for anyone without breaking any rules.