What legislation established the Financial Institution Data Match (FIDM) program?
Public Law 104-193, the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA), also known as the Welfare Reform Act, contains the provisions for the FIDM. Public Law 105-200, the Child Support Performance and Incentive Act of 1998, modified PRWORA to better facilitate the data match for multi-state financial institutions (i.e., those financial institutions operating within two or more states).
All States and territories have laws in place to meet the FIDM requirements of PRWORA. If you wish to see your state's FIDM statute, go to the State Information page and select your state to see or download your state's law.
What is the purpose of FIDM?
FIDM was enacted to help states increase and accelerate delinquent child support collections. It is intended to move families off public assistance by helping them gain self-sufficiency.
Is FIDM compliance required?
Yes. States are required by the federal government to enter into agreements with financial institutions, doing business within their boundaries, to perform a quarterly data match. State child support enforcement office records of those parents delinquent in their child support payments are matched to accounts held at financial institutions.
What types of agreements are necessary?
There are a couple of options, depending on how and where the financial institutions are doing business. Financial institutions that do business within only one state must make their agreement with that state. Multi-state financial institutions may either enter into an agreement with the state or with the federal Office of Child Support Enforcement. State-specific agreements are available to financial institutions on the Alliance Information for Financial Institutions side of the web site.
What happens if a financial institution is unwilling to reach an agreement with the State IV-D agency?
The federal statute requires financial institutions to coordinate with state IV-D agencies. The state is required to have in place whatever procedures or laws are necessary to meet the requirements of section 466(a)(17) of the Act. Should a state fail to do so, federal IV-D funding and possibly federal TANF funding could be at risk. To encourage cooperation, the statute does allow State IV-D agencies to pay a reasonable fee, not to exceed the actual costs incurred by such financial institutions, to financial institutions for conducting the data matches. In addition, states may include penalties in their state laws. OCSE will be able to provide technical assistance to state IV-D agencies and financial institutions that want our help in negotiating the agreements.
What financial institutions must participate in the data match program?
Banks and savings and loans, federal and state credit unions, benefit associations, insurance companies, safe deposit companies, money-market mutual funds, and similar institutions. The types of financial institutions that are required to participate in data matching may vary from state to state. To see your state's specific list, go to the State Information page and select your state to see the specific types listed in your state's law.
What types of accounts are subject to the data match program?
Demand deposit accounts, checking accounts or negotiable withdrawal order account, savings accounts, time deposit accounts, money-market mutual fund accounts. The types of accounts targeted for data matching may vary from state to state. To see your state's specific list go to the State Information page and select your state to see the specific types listed in your state's law.
How often must the data match be conducted?
It must be performed each calendar quarter. Financial institutions may choose which week in the quarter they will perform the match when they sign up with the state.
What data are returned to the state's child support for use in collecting delinquent child support obligations?
Financial Institutions are required to provide the name, record address, social security number or other taxpayer identification number, and other identifying information for each match. It is a format similar to the federal 1099 reporting requirement.
What is the methodology of performing the data match?
Part of the purpose of the FIDM Alliance is to standardize the reporting requirements for both the states and the financial institutions. The record layout used conforms to the federal data-reporting format used by multi-state financial institutions. The record layout is contained in the Data Specifications Handbook (latest edition. Most Alliance states offer two reporting methods to financial institutions:
Method One (the all accounts method) and Method Two (the matched accounts method). You may download the latest version of the Data Specifications Handbook on this website. (click here
How does Method 1, the All Accounts Method, work?
Financial Institutions submit a file identifying all open accounts to Informatix on magnetic media, or downloaded through the FIDM Alliance secure website. Informatix then conducts an internal match against delinquent obligors supplied by the state's child support program. Some Alliance states may require only one All Accounts submission annually, followed by quarterly updates of accounts opened or closed. To see your state's specific requirements, go to the Financial Institutions information page and check-in.
How does Method 2, the Matched Accounts Method work?
Informatix submits the state's child support program inquiry file, containing delinquent obligor's, to the financial institution. The financial institution conducts an internal match against its open accounts.
The financial institution returns a file to Informatix on either electronic media or downloaded through the FIDM Alliance website that contains information on all accounts maintained by individuals on the inquiry to the child support program reporting file.
The match report must be returned to the State within 30-45 days of receipt of the inquiry file. The child support program may issue liens and levies to attach and seize the asset(s) of the delinquent obligor.
How are the data exchanged?
Financial institutions in Alliance states, using either Method 1 or Method 2, may elect to exchange data in several ways. Data may be physically exchanged on paper or electronic media and sent to Informatix for processing. Or it can be downloaded to or from Informatix's FIDM Alliance secure website for quick, easy processing. Informatix has worked out protocols for all the data formats and maintains testing software so that the exchange process can be tested off-line prior to live exchange.
Must states pay a fee to financial institutions for conducting the data match?
State law determines whether a State will pay a fee or not. Fees must not exceed the actual costs of conducting the match. Federal Financial Participation (FFP) is available to partially reimburse the states for the cost of "reasonable" fees paid to the financial institution for the data match.
Can a financial institution be held liable for the release of account information relating to the FIDM program and the levies that may result?
No. Both federal and state laws protect financial institutions from liability if they are in good faith compliance with FIDM reporting requirements.
Section 466(a)(17)(C) of the Social Security Act establishes that a financial institution shall not be liable under any federal or state law to any person for any disclosure of information to the State IV-D agency under section 466(a)(17)(A)(i) of the Act.
Similarly, financial institutions shall not be liable under any federal or state law for encumbering or surrendering any assets they hold in response to a notice of lien or levy issued by the IV-D agency.
Financial institutions will not be held liable for any other action taken in good faith to comply with the requirements of section 466(a)(17)(A) of the Act.