32.1105
Assignment of claims
EFT payments do not replace the need for a properly executed assignment of claims, and incorrect EFT information can result in payment suspension.
Overview
FAR 32.1105 clarifies that using Electronic Funds Transfer (EFT) payment methods does not replace the need for a properly executed assignment of claims as outlined in FAR subpart 32.8. If EFT payment instructions direct funds to someone other than the contractor without a valid assignment of claims, this is considered incorrect EFT information. Such errors can trigger payment suspensions under the relevant EFT contract clauses (52.232-33 and 52.232-34). This section ensures that contractors and contracting officers maintain proper documentation and procedures when assigning claims and setting up EFT payments.
Key Rules
- Assignment of Claims Requirement
- EFT payments cannot substitute for a formal assignment of claims; proper documentation per FAR 32.8 is mandatory.
- EFT Information Accuracy
- EFT instructions must accurately reflect the contractor as the recipient unless a valid assignment of claims is in place.
- Suspension of Payment
- Incorrect EFT information may result in payment suspension under the applicable EFT clauses.
Responsibilities
- Contracting Officers: Must verify that any assignment of claims is properly executed and that EFT information matches contract requirements.
- Contractors: Must ensure assignments of claims are properly documented and that EFT payment instructions are accurate and compliant.
- Agencies: Should oversee compliance and address any discrepancies in payment instructions or assignments.
Practical Implications
- This section prevents improper redirection of payments and protects both the government and contractors from unauthorized assignments.
- Contractors must be diligent in updating EFT information and executing assignments of claims to avoid payment delays.
- Common pitfalls include failing to execute assignments properly or submitting EFT information that does not match contract requirements.