Treasury reviewing garnishment info collection

Collection of information related to garnishment of accounts containing federal benefit payments is under review by the Treasury, with comments due by March 6. The review is part of Treasury’s routine “paperwork and respondent burden” reduction review. According to the Jan. 3 Federal Register, financial institutions must follow particular procedures when a garnishment order is received for an account into which federal benefit payments have been directly deposited; those that comply with the required procedures are given a safe harbor under the rule. The regulations require a financial institution to review the account, to determine if any exempt benefit payments have been directly deposited within the 60 calendar days prior to the receipt of the garnishment order, and, if so, requires the financial institution to ensure that the account holder has access to a protected amount of funds in the account. Once the account review is completed the financial institution must notify the accountholder of the receipt of the garnishment order and provide certain additional information. In addition, a financial institution must maintain certain records of account activity and actions taken in response to garnishment orders sufficient to demonstrate compliance with the regulations.

FR notice/garnishment info collection

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