Expert: Creditwrench - 6/30/2009

Question
QUESTION: Hello, I`m in Oklahoma. I understand social security benefits are exempt from a debt collector attempting to garnish or a bank freezing bank assets. I am in the process of helping my Mother file the Exempt Income Protection paperwork to her bank in case they overlook her direct deposited Social Security check regarding a debt collector attempting to collect for a past debt. What I`m curious about, I`ve read somewhere they can only freeze an amount over $1700 in a bank account. Does that mean if she does not have the exempted income paperwork filed yet and she has less than $1700 in her bank account, they will not touch any of her money even if they get a judgement? It hasn`t gone to court and hoping they don`t go that far.
Thank you!

ANSWER: As you probably know, I'm in Oklahoma too. OKC. Where did you come up with the idea of the Exempt income protection stuff? That isn't going to do your mother any good. It will prove to be nothing but a waste of time and money. The real truth is that so long as money is in a bank it can be garnished even though federal law says it is exempt. The reason that is so is because the law which says it can't be garnished has no teeth. There are no penalties for violating it. Although there are no penalties for violating that law, there are remedies. So if your mother's SSI check is garnished she can sue in federal court for violation of FDCPA. So one law makes garnishment of pension funds illegal it takes another to enforce it but the pensioner must take his own legal action because no governmental agency will do so that I know of. Furthermore, they can get a judgment and then force her into an assets hearing and force her to bring her bank records into court so they can review them to see if there have been any funds other than SSI deposited into the account. If so, then they can go after the whole thing. If a family member gave your mother some money for whatever purpose, even for her birthday or a christmas present they can the use that as an excuse to grab all of her money. So she must be very careful not to deposit any money whatever into that account. Savings accounts can be grabbed too. So if they freeze her money she can be in very bad shape until she can go after them in federal court and that can take a long time. Up to a year or more. In the meantime, she can be in real hardship. The way to prevent all that misery is to learn about FDCPA and FCRA and how to sue them in federal court before they ever get that far. Stop it before it happens. Catching a debt collector breaking the law is easy to do and learning how to sue them in federal court and win without lawyers isn't hard either. So I'd say that if you want to help her then you need to get started learning how to do things the right way instead of messing with theories that sound good but aren't worth the time and effort to try to make them work.


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QUESTION: One last note,
I guess I came up with "Exempt income protection stuff" and "messing around with theories" because of a few links I found on the web pertaining to it. That`s why I thought I would attempt to clarify it by asking you about it. I didn`t know for sure if that applied to this situation or not or even if it really existed. I know the following link is in NYC, that`s why I was attempting to check it out with you. I have been reading how to do things the right way, was just checking the theory in the link.  
http://www.nedap.org/hotline/exempt.html

Answer
The law it refers to is a NY law and NY law has no bearing or effect on what happens or what is available in Oklahoma or anywhere else. Trying to work this problem out by yourself without help will most certainly lead to disaster for you and do so very quickly.