Debt Collection Improvement Act of 1996:

Major Data Sources Inadequate for Implementing the Debtor Bar Provision

GAO-02-462: Published: Mar 29, 2002. Publicly Released: Apr 29, 2002.

Additional Materials:


Gary T. Engel
(202) 512-8815


Office of Public Affairs
(202) 512-4800

The Debt Collection Improvement Act of 1996 seeks to maximize collections of delinquent nontax debt owed to the federal government. However, the act also seeks to reduce losses by requiring proper screening of potential borrowers and information sharing within and among federal agencies. The major information sources of data on delinquent federal debtors are credit bureau reports, the Department of Housing and Urban Development's Credit Alert Interactive Voice Response System (CAIVRS), and the Financial Management Service's (FMS) Treasury Offset Program's (TOP) database. There is no effective mechanism for federal implementation of the act's debtor bar provision. Although credit bureau reports, CAIVRS, and FMS's TOP database each contain some information on delinquent federal nontax debtors, none provides all-inclusive, timely data or maintains them long enough to serve as an adequate data source for successfully barring future financial assistance to currently delinquent debtors or those who did not meet their past obligations. The TOP database, with modifications, now provides an adequate reference point for identifying delinquent debtors to deny them additional financial assistance. Maximizing the TOP database as a delinquency reporting tool would require several changes, such as improving agencies' delinquent debt referral practices and enhancing or supplementing information in the TOP database.

Recommendation for Executive Action

  1. Status: Closed - Not Implemented

    Comments: As of March 2008, an FMS official informed GAO that FMS does not concur with the recommendation because taking the recommended action would (1) require significant changes to the Debt Check system and FMS's current data collection methods; (2) divert valuable resources from other automation efforts; and 3) raise questions over whether using data for other than its original intended purposes would impair FMS ability to comply with the Privacy Act and the Computer Matching Act. Further, FMS may not have authority to require agencies to report to it additional information not needed for offset. Although FMS considers this recommendation closed and has no plans for any corrective action in this area, GAO continues to believe the recommended enhancements are necessary to maximize the effectiveness of the Debt Check program.

    Recommendation: To assist federal agencies in identifying delinquent debtors for the purpose of complying with DCIA's debtor bar provision, GAO recommends that the Commissioner of FMS pursue maximizing the effectiveness of the Barring Delinquent Debtors Program by enhancing or supplementing information from the TOP database that will be made available for the program. Specifically, such enhancements should include data on (1) discharged debts that do not meet the criteria for debt resolution, (2) debt delinquent more than 10 years, and (3) debt normally excluded from TOP referral but delinquent for purposes of denying additional federal financial assistance (e.g., foreclosures)

    Agency Affected: Department of the Treasury: Financial Management Service


Explore the full database of GAO's Open Recommendations »

Sep 10, 2020

Sep 9, 2020

Aug 25, 2020

Aug 6, 2020

Jun 17, 2020

Jun 10, 2020

Jun 8, 2020

May 21, 2020

Mar 31, 2020

Looking for more? Browse all our products here