Garnishment Fraud
Having your wages garnished is no doubt an indignity most people would like to avoid. Unfortunately, situations arise that require legal steps be taken for creditors to receive the money they are due. Failure to be financially responsible can cause embarrassment, discomfort and anxiety. But, once a legal remedy has been decided on, attempting to defraud that decision by the court can cause even greater problems. Fraud is a crime.
Other People Are Reading
-
Garnishments Defined
-
Garnishment of wages is a legal procedure that mandates that an employer withhold a portion of a person's earnings to help pay a debt or obligation (such as child support payments). The process involves three parties: an employee, the creditor, and the employer. Employers are responsible to make the correct deductions from an employee's paycheck and forward those payments to the creditor(s). The garnishment programs begins with a warning, which is a judgment from the court sent to the garnishee (employer) that states that it must withhold wages and hold them in trust until there is a conclusion to the plaintiff's suit. This ensures the plaintiff will recover at least this small amount should they win their case.
Employer's Responsibilities
-
According to Title III of the Consumer Credit Protection Act (CCPA), employers are prohibited from discharging an employee because they have become subject to garnishment. Penalties for violating this law can result in a fine of not more than $1,000 or imprisonment for up to one year.
-
Stopping Garnishment When Due to Credit Card Fraud
-
If your wages are being garnished but you were never served a summons for a lawsuit and a default judgment was entered against you, it's possible to have the judgment withdrawn and possibly recover your money. It will require you to petition for an equitable review. This is a fairly technical process and will require the assistance of a competent attorney.
Defrauding the Garnishment System
-
In most states you can only be subject to one wage garnishment at any one time. Typically, the first one to request a garnishment is the one to receive it. Those attempting to avoid a real garnishment demand will create a phony one with the help of a co-conspirator. The partner in fraud enters the complaint in court (prior to the legitimate one) and receives the judgment first. He then collects the garnishment and returns the money to the employee so that the employee essentially loses nothing other than what he pays his partner. This effectively blocks the legal garnishment. This is an interstate criminal conspiracy to defraud and will result in the FBI arresting those involved. For this fraudulent garnishment to work, all involved must use their real names and addresses, which are filed in court, making the arresting officer's job easily done. The scheme is extremely transparent and rarely works for any length of time.
Maximum Allowable garnishment
-
According to law, the maximum part of a person's earnings for a work week subject to garnishment may not be more than 25 percent. If earnings are calculated differently than a weekly basis, the regulation prescribes that it will be calculated according to a multiple of the federal minimum hourly wage that results in the equivalent amount.
-
References
Resources
- Photo Credit dollars image by Alexey Klementiev from Fotolia.com
