Wage Garnishments can be suspended

Illinois announces new protections for residents receiving federal stimulus checks

April 14, 20203:11 pm

Andrew CarriganCORONAVIRUS,ILLINOIS NEWS,TOP STORIES

CHICAGO (WREX) — Illinois Governor JB Pritzker announced new measures to help ensure residents receiving a stimulus check will be able to use it on essential needs.
The governor announced the state is suspending laws that permit the service of a garnishment summons, wage deduction summons, or a citation to discover assets as part of consumer debt collection proceedings.
These protections are being put in place to help ensure the checks are being used on food, shelter and transportation, according to the state.
The Illinois Department of Financial and Professional Regulation also issued Best Practices to Illinois licensed lenders encouraging them to work with struggling borrowers during the pandemic to extend the time for payment, waive late charges, and defer collection measures.

“These measures are intended to assist those impacted by this emergency and in need of temporary financial assistance,” said Deborah Hagan, Secretary of the Department of Financial and Professional Regulation.

The state says residents can also take temporary measures to protect their household income for family essentials by considering stopping automatic loan payments and rescinding wage assignments.

Above is from:  https://wrex.com/2020/04/14/illinois-announces-new-protections-for-residents-receiving-federal-stimulus-checks/

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Debt Collectors Can Seize Your $1,200 Coronavirus Relief Check

Luke Darby

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GQ•April 14, 2020

By Wednesday, some 80 million Americans should receive a one-time $1,200 check from the federal government. It's part of the CARES Act, Congress's emergency coronavirus package meant to keep the country going through lockdowns and social distancing measures that states are implementing to slow the spread of the virus. Last week, a group of Democratic senators—Sherrod Brown of Ohio, Ron Wyden of Oregon, and Elizabeth Warren of Massachusetts—wrote to treasury secretary Steve Mnuchin to fix a glaring hole in the legislation. Missouri Republican senator Josh Hawley also joined Brown to reiterate the request. As written, none of the $1,200 can be garnished for any debt held by state or federal agencies. But the CARES Act specifically leaves out privately held debt, meaning that debt collectors can grab the relief payment before it even gets to the people who need it.

Despite 25 Democrat and Republican state attorneys general joining the senators, Mnuchin made no moves to protect people from debt collectors. In fact, according to the magazine Prospect, the Treasury Department informed banks that they were free to seize the money straight from people's checking accounts:

The Treasury Department effectively blessed this activity on a webinar with banking officials last week. In audio obtained by the Prospect, Ronda Kent, chief disbursing officer with Treasury’s Bureau of the Fiscal Service, can be heard explaining that banks had posed questions to her about "whether these payments could be subject to collection from the bank to which the money is deposited, if the payee owes an outstanding loan or other payments to the bank." She responded—twice—that "there’s nothing in the law that precludes that action," while counseling that the banks’ compliance officers should consult with their legal offices about what policies their banks will implement. "You will want to know for your bank what your bank has decided to do," Kent said.

Before joining the Trump administration, Mnuchin, a former Goldman Sachs executive, made his fortune by acquiring California’s IndyMac bank during the 2008 financial crisis and aggressively foreclosing on more than 36,000 properties, kicking elderly people and active-duty veterans out of their homes. Worth an estimated $400 million according to Forbes, Mnuchin is a tireless promoter of tax cuts for the rich, claiming as recently as February that "the trillion and a half dollars of tax cuts we have made will pay for themselves."

Mnuchin's belief that tax cuts for the wealthy are a panacea for any economic problem is widely held among GOP officials. According to a new report from the Joint Committee on Taxation, a nonpartisan congressional group, more than 80 percent of the tax breaks Senate Republicans included in the coronavirus relief package go to people making more than $1 million per year. This extra support for the already-rich—who currently pay 79 percent less in taxes than they did 40 years ago—is expected to cost $90 billion for 2020 alone.

Meanwhile, millions of Americans couldn't afford an emergency $1,000 expense—that was before the coronavirus outbreak caused more than 16 million people to file for unemployment in less than a month. And the unprecedented 16 million jobless claims is likely an undercount, since many states' unemployment websites crashed due to heavy traffic. So far most of the people who have gotten their relief payments have spent it on food, according to the Washington Post. The relief money, after all, is supposed to help working people survive and put some money back into the economy—not go straight into the accounts of debt collectors and bank executives. Daniel Ruffner, a cook in upstate New York who works at a restaurant that's not closed, received his check last Friday and told the Post, "I’ve just been stocking up on food and paying all of the bills. It’s nice to finally be able to see my bills go to zero." He reportedly spent the entire $1,200 check on groceries, Internet, heating, and rent.

Above is from:  https://finance.yahoo.com/news/debt-collectors-seize-1-200-202613979.html