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iCompliance Challengei covers benefit garnishments
WASHINGTON (3/24/11)—In this month’s Compliance Challenge, the Credit Union National Association (CUNA) notes that most, but not all federal benefits are exempt from garnishment. The U.S. Treasury, in conjunction with four other federal agencies, has issued an interim final rule which protects the following benefits payments from garnishments and claims of judgment creditors: social security payments, supplemental security income, veterans administration benefits, federal railroad retirement benefits, and federal employees retirement system benefits. The other agencies on the rule are, not surprisingly, the Social Security Administration, the Department of Veteran Affairs, the Railroad Retirement Board, and the Office of Personnel Management. CUNA notes, though, that the final rule provides that garnishment orders obtained by the U.S. and child support orders (for child support programs administered under Title IV-D of the Social Security Act) can be processed against these benefits. Credit unions may follow their normal procedures for garnishment orders in these instances. Credit unions generally must review a member’s account within two days of receiving any garnishment order, and must examine two months of recent account activity during this review. However, account reviews are not required if the garnishment order is obtained by the U.S. or is a child support-related order. Garnishment fees may not be charged against protected funds. However, garnishment fees may be charged against any petty cash that is in a given account at the time of a garnishment order review. For more of this month’s Compliance Challenge, use the resource link.


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