LANSING, Mich., April 21, 2020 — State Reps. Sarah Anthony (D-Lansing) and Kara Hope (D-Holt) introduced House Resolutions 246 and 247 to urge the United States Department of Treasury to protect stimulus payments created by the federal CARES Act from private debt collection by banks and garnishment by creditors and debt collectors. Currently, if Americans have outstanding debts with banks, such as overdraft fees or delinquent loans, these institutions can choose to deduct these amounts from stimulus payments.

“The COVID-19 pandemic has had a devastating impact on our economy and pocketbooks,” said Anthony, who notes that consumers had paid more than $34.3 billion in overdraft fees in 2017. “People are relying on these stimulus payments to keep a roof over their heads and food on their tables during this crisis, which is why it’s imperative for us to do everything in our power to protect the integrity of this aid.”

The payments are also able to be garnished by private creditors or other debt collectors, reducing or eliminating the amount available to recipients for paying immediately necessary expenses like mortgages, rent, utilities and groceries.

“Millions of people across the country are depending on these payments to feed their families and keep their housing,” said Hope. “The United States Department of Treasury must ensure these payments end up in the hands of the people who need them and not debt collectors.”

The federal CARES Act, as passed by Congress, provides the U.S. Department of Treasury with the power to issue regulations or guidance necessary to its implementation, including exemptions of stimulus payments from collections, such as those outlined by HRs 246 and 247.