Archive Links

Consumer Archive
CU System Archive
Market Archive
Products Archive
Washington Archive

News Now

Washington
Treasury issues new garnishment procedures
WASHINGTON (2/28/11)--The U.S. Treasury and several other federal agencies have published for public comment an interim rule that establishes procedures that credit unions must follow when they receive a garnishment order against an account holder who receives certain federal benefit payments by direct deposit. The Office of Personnel Management, the Railroad Retirement Board, the Social Security Administration, and the Department of Veteran Affairs are also listed on the joint release. The rule prohibits the garnishment of certain “protected” benefits, but does not impact garnishments obtained by the United States and child support garnishment orders. Credit unions will still be allowed to process the garnishment against protected funds in these cases. Under the rule, credit unions will need to provide notification to the account holder when a garnishment order is received. The credit union will also need to briefly outline what a garnishment order is and explain the account holder’s rights with regard to garnishment in this notification. The notice will not be required if the account balance is zero or reflects a negative balance on the date of account review. Once they have received the garnishment order, credit unions will generally have two days to perform an account review. This account review must determine the amount of federal benefit payments that have been deposited to the member’s account within the last two months. Credit unions must then ensure that the member has access to this so called “protected” amount or the current balance of the account, whichever is lower. Credit unions may not charge garnishment fee against these protected funds and are prohibited from charging a fee after the date of the account review. However, credit unions may levy garnishment fees against any unprotected funds in the account. The rule is scheduled to come into effect on May 1, and comments will be accepted until May 24. For the proposal, as published in the Federal Register, use the resource link.
Other Resources

RSS print
News Now LiveWire
#FreeGasFriday courtesy of @tvfcu, TN #creditunions http://t.co/wDRFYJVlpz
13 hours ago
If you were unable to watch or attend @cuna 's @thehill Hill forum on Wed., you can now watch the archived version: http://t.co/FhUnp7HbU8
15 hours ago
Time is running out. If you haven't taken the #NewsNow readership survey, please click here now: http://t.co/4Gp6C2Wa4o
15 hours ago
African financial inclusion possible with mobile money: @IMFNews study http://t.co/0V5DTQToxY
16 hours ago
Louise Herring's birthday is Saturday. 105 years later, her legacy lives on through her kids http://t.co/oMqGADmo0d http://t.co/T3NmS9NqEY
16 hours ago