State Treasurer Steven Grossman has launched an internal investigation after an error by his office delayed benefits payments to about 53,000 retired teachers.
The problem, which affected 92 percent of retired educators whose Massachusetts Teachers’ Retirement System benefits are electronically deposited into their bank accounts, has been rectified, but the deposits may not go through until Friday, Grossman said.
“Normally what happens is we at Treasury send a file to our bank, Sovereign Bank, toward the end of the month giving them plenty of time to process the payments, and the money lands in [the retiree’s] bank account on the last day of the month,” he said in a phone interview. “This month, because of human error, that did not happen.”
Grossman said his office became aware of the problem Thursday morning, when several retired teachers called to inquire about the whereabouts of their benefit payments. He said the file was immediately sent to Sovereign Bank upon learning of the error.
In a recorded message on its phone system, the Massachusetts Teachers’ Retirement System said the problem has been corrected.
“Be advised that the May direct deposits were delayed,” the message said. “The state Treasury has resolved the issue and assured us that all MTRS benefit recipients’ direct deposits will be made by 1 p.m. on Friday, June 1.”
Grossman said he has asked his agency’s in-house auditor and other senior officials to “look into every aspect of this and why it broke down. . . . If there is any discipline that needs to be taken, we will consider that when and if it is appropriate.”
Grossman said his office will work with the teachers’ retirement system to reimburse any retiree hit with a bank fee because of the problem.
“We do not want a single retiree to spend a dime out of their pocket that they should not have spent but for our error,” he said.
The glitch irked some former educators.
“It wouldn’t have mattered to me that much, but we have things planned for the weekend,” Stephen Graham, who retired from Tyngsborough public schools in 2001 after teaching for 35 years, said Thursday. “I planned to go to the bank today to withdraw some money, but I wasn’t able to do that.”
Retired teachers who receive a check for their monthly benefits and teachers who are also part of the State Employees Retirement System were not affected by the issue, officials said.
The Massachusetts Teachers’ Retirement System provides “retirement, disability, and survivor benefits to more than 88,000 active educators and 55,000 retirees and survivors,” according to its website.