Q Can a credit union charge a fee for costs related to garnishment orders involving federal benefit payments?
A It depends. The interim final rule on the garnishment of federal payments prohibits a credit union from charging a garnishment fee against protected funds in an account.
Protected payments under the rule include Social Security benefits, Supplemental Security Income benefits, Veterans Administration benefits, Federal Railroad Retirement benefits, and Federal Employee Retirement System benefits.
The credit union can’t charge a fee for garnishment processing if the only funds available in an account are from protected payments.
But the rule doesn’t prohibit the credit union from processing a fee against the unprotected funds that are in the account at the time.
For more information, visit CUNA’s e-Guide to Federal Laws and Regulations.