113.01 Mismanagement of Funds (FAM)

SR 97-27 Dated 08/97

Previous Policy


Persistent mismanagement of the assistance payment to the detriment of the individual or of the dependent children is an indication that a protective payee may need to be considered.

Evidence of mismanagement includes the following:

• Recurring inability to plan for and meet a months needs;

• Recurring failure to meet obligations for shelter and food;

• Repeated evictions;

• Repeated incurrence of debts with attachments against non-assistance income; or

• Recurring incidence of children not being fed or clothed, with their development threatened through lack of proper care.


The following are not valid reasons for protective payments:

• Lack of funds to meet emergencies such as a sudden decrease in income or a sudden illness;

• Expenses for necessary bills exceed the individuals grant and other income; or

• The individual is withholding payment as a reasonable exercise of consumer rights when there is a legitimate dispute about an agreement.

Physical or mental incapacity is not a valid reason for assigning a protective payee.

At least every 6 months, determine the continued need for a protective payee and whether the protective payee is meeting the responsibilities.

Limit protective payments for mismanagement of funds to 2 years. Terminate protective payments when the earliest of the following situations occurs:

• The individual is able to manage funds;

• A guardian or other legal representation is obtained; or

• The two-year period has expired.