Washington Post On Garnishment Of Social Security Benefits

From the Washington Post:

... [I]n some cases, the actions of the financial institutions in carrying out court [garnishment] orders are of questionable legality, according to a new report by the Social Security Administration's Office of the Inspector General.

The inspector general found that some financial institutions are apparently violating federal law by garnishing accounts that receive electronic deposits of old age, survivors and disability insurance, and/or supplemental security income payments. These funds are supposed to be protected from creditors except under certain conditions. ...

During a 12-month period beginning September 2006, the 12 largest banks took $1 million from accounts that held only government benefits. An additional $29 million was taken from accounts that held government benefits money mixed with cash from other sources, according to the report. The inspector general also found in some cases that banks were charging legal processing fees, overdraft charges or insufficient-funds charges as the result of a garnishment.

Although the sample size in this investigation was relatively small, the inspector general's report concluded that if all financial institutions followed the pattern of those investigated, as much as $177.7 million in garnishments could be attributable to beneficiaries receiving direct deposit of Social Security benefits.

And here is a link to the Inspector General report.