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Flashcards in Garnishments Deck (13):

T or F

Generally, federal payments are protected from garnishments.



Prior to taking any action related to a garnishment order, and no later than _____ following the receipt of the order, the institution must determine if the _________________ has attached a Notice of Right to Garnish Federal Benefits.

* two business days

* Federal Government or a State Child Support Enforcement Agency


When the Notice of Right to Garnish Federal Benefits is not included, the institution must perform an account review of the preceding ______ within _______.

* two months

* two business days (can be negotiated with the creditor if needed)


When the account lookback determines that no federal benefits were deposited into the account, what garnishment procedures should be followed?

the usual procedures established by the institution


When the account lookback determines that federal benefits were deposited into the account, what garnishment procedures should be followed?

The institution must act to protect those benefit payments


T or F

The institution must perform separate reviews for each account in the name of the account holder that is subject to the garnishment action.



What constitutes the protected amount for garnishment lookbacks?

the lesser of

* the sum of all benefit payments posted to an account during the lookback period OR

* the balance in the account when the review is performed


Protected amounts for garnishment lookbacks as calculated by the institution are considered to be conclusively:

exempt from garnishment.


The institution must provide a notice to the account holder named in a garnishment order within _____ from account review and include:

* 3 business days

* the protected amount and any excess funds

* notice of the garnishment

* forms pertaining to the order


Institutions may not charge or collect a fee against the protected amount but may collect a garnishment fee up to ________ after the review if additional available funds are deposited into the account.

five business days


Institutions must retain records to demonstrate compliance for a period of _______ from the date of garnishment order receipt.

two years


Penalties for violations of garnishment rules can be up to:

*$7500 per day for general violations

* $37,500 per day for safety and soundness violations

* $1,425,000 per day for knowingly or recklessly causing substantial losses


T or F

Garnishment rules apply to accounts where federal benefits are paid by treasury checks.


the garnishment rules only apply to benefits paid electronically