Senators Propose CARES Act Stimulus Protections

ACA continues to educate lawmakers about the industry’s role in helping consumers resolve financial issues while ensuring them that stimulus funds are not identified or targeted by debt collectors.

5/28/2020 11:00 AM

AdvocacyNewsCOVID-19
Senators Propose CARES Act Stimulus Protections

A bipartisan proposal to prevent garnishment of stimulus payments issued to consumers under the Coronavirus Aid, Relief, and Economic Security (CARES) Act—a practice that would be extremely rare as part of debt collectors’ work with consumers—is circulating in the U.S. Senate.

On May 22, U.S. Sens. Sherrod Brown, D-Ohio, ranking member of the Senate

Committee on Banking, Housing, and Urban Affairs; Chuck Grassley, R-Iowa, chair of the Senate Finance Committee; Ron Wyden, D-Ore., ranking member of the finance committee; and Tim Scott, R-S.C., “introduced a bill to protect recovery payments provided in the recent CARES Act pandemic response legislation from garnishment by private debt collectors,” according to a news release.

Proposals in the bill include:

  • “For any electronic payments, such as direct deposit, the bill directs the Treasury Department to encode payments so that banks can identify and protect these payments from being garnished by debt collectors;
  • For other payments, such as checks, the bill allows individuals to request that their banks or other financial institution protect the payments from being garnished by debt collectors and authorizes the financial institutions to do so.”

ACA has been working closely with Senate staff to educate them that the debt collection industry is not actively targeting stimulus checks. The press surrounding this issue also continues to conflate legal terms such as bank levies versus wage garnishments.

Educating Congress about the work ACA members are doing will continue next week at the Washington Insights Livestream June 3.

Specific to misconceptions about the garnishment process, ACA submitted a letter to the U.S. Department of Treasury Secretary Steven Mnuchin addressing claims from consumer advocacy organizations that debt collectors are seeking to target stimulus fund checks issued under the CARES Act.

ACA maintains it is important that policies provide consumers with more options that will allow them to access credit and services while placing financial decisions into the hands of consumers—which is achieved through communication. ACA members are trained to work with consumers and to access hardship programs to help consumers make arrangements that best suit their unique financial situation, including implementing temporary suspension of collections for consumers directly impacted by the coronavirus.

Meanwhile, Senate Majority Leader Mitch McConnell, R-Ky., said another coronavirus relief bill is “likely” to surface on Capitol Hill, The Hill reports.

In a 208-199 vote on May 15, the House passed the $3 trillion HEROES Act, which includes some provisions that will have a significant impact on the ARM industry. ACA’s advocacy continues to educate Congress about troublesome provisions in the bill. The Senate is not expected to take up the full package from the House, and there will continue to be opportunities for Congress to remove the problematic provisions as it moves through both chambers.

Read more on the HEROES Act and concerns for the industry on ACA’s website here.

There is still time to register for the Washington Insights Livestream June 3 and learn more about legislative and regulatory activity at the state and federal level and get involved in advocacy.


Follow ACA International on Twitter @ACAIntl and @acacollector, Facebook and request to join our LinkedIn group for news and event updates. ACA International members are welcome to submit news items for possible publication to comm@acainternational.org. Visit our publications page for news submission guidelines and subscriptions to ACA Daily, Collector magazine and Pulse.

Advertising is available for companies wishing to promote their products or services. Be sure to visit the ACA Events Calendar on the Education and Training page to view our listing of upcoming CORE Curriculum and Hot Topic seminars featuring critical educational opportunities for your company.


Subscribe to ACA Daily NEWSROOM

Senators Propose CARES Act Stimulus Protections

A bipartisan proposal to prevent garnishment of stimulus payments issued to consumers under the Coronavirus Aid, Relief, and Economic Security (CARES) Act—a practice that would be extremely rare as part of debt collectors’ work with consumers—is circulating in the U.S. Senate.

On May 22, U.S. Sens. Sherrod Brown, D-Ohio, ranking member of the Senate

Committee on Banking, Housing, and Urban Affairs; Chuck Grassley, R-Iowa, chair of the Senate Finance Committee; Ron Wyden, D-Ore., ranking member of the finance committee; and Tim Scott, R-S.C., “introduced a bill to protect recovery payments provided in the recent CARES Act pandemic response legislation from garnishment by private debt collectors,” according to a news release.

Proposals in the bill include:

  • “For any electronic payments, such as direct deposit, the bill directs the Treasury Department to encode payments so that banks can identify and protect these payments from being garnished by debt collectors;
  • For other payments, such as checks, the bill allows individuals to request that their banks or other financial institution protect the payments from being garnished by debt collectors and authorizes the financial institutions to do so.”

ACA has been working closely with Senate staff to educate them that the debt collection industry is not actively targeting stimulus checks. The press surrounding this issue also continues to conflate legal terms such as bank levies versus wage garnishments.

Educating Congress about the work ACA members are doing will continue next week at the Washington Insights Livestream June 3.

Specific to misconceptions about the garnishment process, ACA submitted a letter to the U.S. Department of Treasury Secretary Steven Mnuchin addressing claims from consumer advocacy organizations that debt collectors are seeking to target stimulus fund checks issued under the CARES Act.

ACA maintains it is important that policies provide consumers with more options that will allow them to access credit and services while placing financial decisions into the hands of consumers—which is achieved through communication. ACA members are trained to work with consumers and to access hardship programs to help consumers make arrangements that best suit their unique financial situation, including implementing temporary suspension of collections for consumers directly impacted by the coronavirus.

Meanwhile, Senate Majority Leader Mitch McConnell, R-Ky., said another coronavirus relief bill is “likely” to surface on Capitol Hill, The Hill reports.

In a 208-199 vote on May 15, the House passed the $3 trillion HEROES Act, which includes some provisions that will have a significant impact on the ARM industry. ACA’s advocacy continues to educate Congress about troublesome provisions in the bill. The Senate is not expected to take up the full package from the House, and there will continue to be opportunities for Congress to remove the problematic provisions as it moves through both chambers.

Read more on the HEROES Act and concerns for the industry on ACA’s website here.

There is still time to register for the Washington Insights Livestream June 3 and learn more about legislative and regulatory activity at the state and federal level and get involved in advocacy.


Follow ACA International on Twitter @ACAIntl and @acacollector, Facebook and request to join our LinkedIn group for news and event updates. ACA International members are welcome to submit news items for possible publication to comm@acainternational.org. Visit our publications page for news submission guidelines and subscriptions to ACA Daily, Collector magazine and Pulse.

Advertising is available for companies wishing to promote their products or services. Be sure to visit the ACA Events Calendar on the Education and Training page to view our listing of upcoming CORE Curriculum and Hot Topic seminars featuring critical educational opportunities for your company.


Subscribe to ACA Daily NEWSROOM

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