Cal. Code Regs. Tit. 9, § 784.32 - Safeguards for Clients' Monies and Valuables

(a) Each mental health rehabilitation center to whom a clients' monies or valuables have been entrusted shall comply with the following:

(1) No licensee shall commingle clients' monies or valuables with that of the licensee or the mental health rehabilitation center. Clients' monies and valuables shall be maintained separately, intact and free from any liability that the licensee incurs in the use of the licensee's or the mental health rehabilitation center's funds. The provisions of this section shall not be interpreted to preclude prosecution for the fraudulent appropriation of clients' monies or valuables as theft, as defined by Section 484 of the Penal Code.

(2) Each licensee shall maintain safeguards and accurate records of clients' monies and valuables entrusted to the licensee's care including the maintenance of a detailed inventory and at least a quarterly accounting of financial transactions made on clients' behalf.

(A) Records of clients' monies which are maintained as a drawing account shall include a control account for all receipts and expenditures, supporting vouchers and receipts for all expenditures of monies and valuables entrusted to the licensee, an account for each client and supporting vouchers filed in chronological order. Each account shall be kept current with columns for debits, credits and balance. All of these records shall be maintained at the mental health rehabilitation center for a minimum of three years from the date of transaction. At no time may the balance in a client's drawing account be less than zero.

(B) Records of clients' monies and other valuables entrusted to the licensee for safekeeping shall include a copy of the receipt furnished to the client or to the client's authorized representative. Each item of client property entrusted to the licensee shall be clearly identified as belonging to that client.

(3) Clients' monies not kept in the mental health rehabilitation center shall be deposited in a demand trust account in a local bank authorized to do business in California, the deposits which are insured by the Federal Deposit Insurance Corporation, or in a federally insured bank or savings and loan association under a plan approved by the Department. If a facility is operated by a county, such funds may be deposited with the county treasurer. All banking records related to these funds, including but not limited to deposit slips, checks, cancelled checks, statements and check registers, shall be maintained in the mental health rehabilitation center for a minimum of three years from the date of transaction. Identification as a client trust fund account shall be clearly printed on each client's trust account checks and bank statements.

(4) A separate list shall be maintained for all checks from client funds which are, or have been, outstanding for 45 days or more as reflected on the most recent bank statement. Bank statements shall be reconciled monthly with copies of the reconciliation maintained by the mental health rehabilitation center. Any checks on such accounts written off or uncashed shall result in an addition to the appropriate client's account.

(5) Expenditures, for a particular client, from the client fund account as specified in (3) above may not exceed the drawing right that the client has in the account. Expenditures from the client fund account shall only be for the immediate benefit of that particular client. No more than one month's advance payment for care may be received from a client's account.

(6) A person, firm, partnership, association or corporation which is licensed to operate more than one mental health rehabilitation center shall maintain a separate demand trust account as specified in (3) above for each such mental health rehabilitation center. Records relating to these accounts shall be maintained at each mental health rehabilitation center as specified in (2) above. Client funds from one mental health rehabilitation center shall not be mingled with funds from another mental health rehabilitation center.

(7) When the amount of clients' money entrusted to a licensee exceeds $500, all money in excess of $500 shall be deposited in a demand trust account as specified in (3) above unless the licensee provides a fireproof safe and the licensee desires the protection accorded by Section 1860 of the Civil Code.

(8) Upon discharge of the client, all money and valuables of that client which have been entrusted to the licensee and kept within the mental health rehabilitation center shall be surrendered to the client or authorized representative in exchange for a signed receipt. Monies in a demand trust account or with the county treasurer shall be surrendered to the client or authorized representative in exchange for a signed receipt. Monies in a demand trust account or with the county treasurer shall be made available within three (3) normal banking days. Upon discharge, the client or authorized representative shall be given a detailed list of personal property and a current copy of the debits and credits of the client's monies.

(9) Within 30 days following the death of a client, except in a coroner or medical examiner case, all money and valuables of that client which have been entrusted to the licensee shall be surrendered to the person responsible for the client or to the executor or the administrator of the estate in exchange for a signed receipt. Whenever a client without known heirs dies, immediate notice, shall be given by the facility to the public administrator of the county as specified by Section 7600.5 of the California Probate Code and documentation of this notice shall be available in the mental health rehabilitation center for review by the Department.

(10) Upon change of ownership of a mental health rehabilitation center, there shall be a written verification by a certified public accountant of all clients' monies which are being transferred to the custody of the owner(s). A signed receipt for the amount of funds in the client's trust account shall be given by the new owner to the previous owner.

(11) Upon closure of a mental health rehabilitation center, a written verification by a public accountant of all clients' funds shall be available for review by the Department. Each client's funds shall be transferred with the client.

(b) If property is purchased for use of more than one client, from client trust funds, the mental health rehabilitation center shall secure a written agreement between all clients whose funds are used, or their authorized representatives. The agreement shall expressly acknowledge consent of all parties and shall provide for disposition of the property in the event of disagreements, discharge, transfer or death.

(c) No licensee, owner, program director, employee or their immediate relative or representative of the aforementioned may act as an authorized representative of clients' funds or valuables, unless the client is a relative within the second degree of consanguinity.

(d) The mental health rehabilitation center shall make reasonable efforts to safeguard clients' property and valuables that are in possession of the client.

(e) For purposes of this section, clients' funds maintained in a financial institution shall be deemed to be entrusted to a mental health rehabilitation center if the licensee, or any agent or employee thereof, is an authorized signatory to said account. Records maintained and provided by the financial institution in accordance with a plan which has obtained the written approval of the Department, may fulfill the obligation of the mental health rehabilitation center with regard to the maintenance of records for such funds.

Notes

Cal. Code Regs. Tit. 9, § 784.32

1. New section filed 8-21-95 as an emergency; operative 8-21-95 (Register 95, No. 34). A Certificate of Compliance must be transmitted to OAL by 2-17-95 or emergency language will be repealed by operation of law on the following day.
2. New section refiled 2-9-96 as an emergency; operative 2-9-96 (Register 96, No. 6). A Certificate of Compliance must be transmitted to OAL by 6-8-96 or emergency language will be repealed by operation of law on the following day.
3. New section refiled 6-10-96 as an emergency; operative 6-10-96 (Register 96, No. 24). A Certificate of Compliance must be transmitted to OAL by 10-8-96 or emergency language will be repealed by operation of law on the following day.
4. New section refiled 10-8-96 as an emergency; operative 10-8-96 (Register 96, No. 41). A Certificate of Compliance must be transmitted to OAL by 2-5-97 or emergency language will be repealed by operation of law on the following day.
5. Certificate of Compliance as to 10-8-96 order transmitted to OAL 2-5-97; disapproved by OAL and order of repeal as to 10-8-96 order filed on 3-21-97 (Register 97, No. 12).
6. New section filed 3-21-97 as an emergency; operative 3-21-97 (Register 97, No. 12). A Certificate of Compliance must be transmitted to OAL by 7-21-97 or emergency language will be repealed by operation of law on the following day.
7. Certificate of Compliance as to 3-21-97 order, including renumbering of former section 784.32 to new section 784.33, and renumbering and amendment of former section 784.31 to new section 784.32, transmitted to OAL 7-21-97 and filed 8-21-97 (Register 97, No. 34).

Note: Authority cited: Sections 5675 and 5768, Welfare and Institutions Code. Reference: Sections 5675 and 5768, Welfare and Institutions Code.

1. New section filed 8-21-95 as an emergency; operative 8-21-95 (Register 95, No. 34). A Certificate of Compliance must be transmitted to OAL by 2-17-95 or emergency language will be repealed by operation of law on the following day.
2. New section refiled 2-9-96 as an emergency; operative 2-9-96 (Register 96, No. 6). A Certificate of Compliance must be transmitted to OAL by 6-8-96 or emergency language will be repealed by operation of law on the following day.
3. New section refiled 6-10-96 as an emergency; operative 6-10-96 (Register 96, No. 24). A Certificate of Compliance must be transmitted to OAL by 10-8-96 or emergency language will be repealed by operation of law on the following day.
4. New section refiled 10-8-96 as an emergency; operative 10-8-96 (Register 96, No. 41). A Certificate of Compliance must be transmitted to OAL by 2-5-97 or emergency language will be repealed by operation of law on the following day.
5. Certificate of Compliance as to 10-8-96 order transmitted to OAL 2-5-97; disapproved by OAL and order of repeal as to 10-8-96 order filed on 3-21-97 (Register 97, No. 12).
6. New section filed 3-21-97 as an emergency; operative 3-21-97 (Register 97, No. 12). A Certificate of Compliance must be transmitted to OAL by 7-21-97 or emergency language will be repealed by operation of law on the following day.
7. Certificate of Compliance as to 3-21-97 order, including renumbering of former section 784.32 to new section 784.33, and renumbering and amendment of former section 784.31 to new section 784.32, transmitted to OAL 7-21-97 and filed 8-21-97 (Register 97, No. 34).