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#1146403 - 03/17/09 05:57 PM Restraining Notices in Layman's terms please!!!
ROCCOA65
Unregistered

I am fairly new to my position as Legal Notice Specialist at the bank where I am employed. I'm inquiring to see if SOMEONE out there can "reword" a Restraining Notice so that a layman (woman) such as myself can understand exactly what we are being asked to do!?!?!? I am far from being an attorney, nor do I claim to ever attempt to become one (too old to begin the process!)......I just want to know that I/We can be sure that the laws are being followed! The wording is such that I question if I/We are truly digesting it properly....

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#1146776 - 03/18/09 01:06 PM Re: Restraining Notices in Layman's terms please!!!
edAudit Offline
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edAudit
Joined: Jul 2008
Posts: 4,797
You are here
In NY it is covered by § 5222. Restraining notice. I know reading the actual law is confusing but in this case it is not to bad.

To make ot short it is issued by the court to have the bank place some type of action agent the depositor. Each one is different. From previous experience a good majority of them require the bank to hold the funds for a period or time and then remit the funds to the court. I have not delt with them in a while but in the past we were required to hold double the amount of the funds to be remitted. After the funds were remitted we removed the holds. Usualy the bank collects a fee for this process and would be in banks schedule of fees.

The post New York Civil Practice Law and Rules 5222 - Restraining Notice.
http://law.onecle.com/new-york/civil-practice-law-and-rules/CVP05222_5222.html

is not a bad reference

Be aware that certain fund can not be held
1. Supplemental security income, (SSI);
2. Social security;
3. Public assistance (welfare);
4. Alimony or child support;
5. Unemployment benefits;
6. Disability benefits;
7. Workers' compensation benefits;
8. Public or private pensions; and
9. Veterans benefits.
As I stated above the legal is not a bad reference but you have to follow the notice that is sent to you or you will be in troble.

Best of luck

Ed
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Opinions can be considered as coming from anywhere but my employer.

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#1167460 - 04/21/09 06:59 PM Re: Restraining Notices in Layman's terms please!!!
Compliance Buzz Offline
Gold Star
Joined: Feb 2002
Posts: 319
NJ
Guita, I feel your confusion. As I can best explain it: the restraining notice, like a levy, specifies a judgment amount, but the restraining notice requires the bank place a hold on the customer's account for the entire amount of the judgment - regardless of whether there are enough funds in the account (which could cause a negative balance). The hold remains on the account for up to a year in the hope that more money will come in to the account to satisfy the judgment. The restraining notice must be released, and any 'captured' funds remitted to the server, a year after it's served, but it can be released prior to that time with a court order, or request from the judgment creditor.

In January, the laws were compeletely changed, and NY established standard exemptions from any levy or restraint to protect individuals and allow them to have some money to live on. In addition, they added requirements on servers to provide the bank with certain forms, standardized customer notice, 25 day waiting periods for customer response, etc. We are a NJ bank with a branch in NY, and it has taken me the last three days to understand the revised laws that became effective in January - especially the exemptions. I found this letter from the Banking Department that helped. I created a summary for our deposit operations staff on NY legal judgments which I hope helps a little(**these are NOT procedures and they may not be 100% accurate):

-----------------------------------------------------
TYPES OF JUDGMENT/SEIZURE:

Levies:
Served on the bank in the form of a document titled “Execution with Notice to Garnishee.”

• Requires immediate hold of non-exempt available funds in the named customers’ account(s), up to the amount of the judgment.
• Requires the Bank to provide a copy of the execution, an Exemption Notice and Claim Form to a natural person (personal/sole proprietor’s only) within 2 days of receipt of the levy/execution notice.

Restraining Notices:
Served on the bank in the form of a Restraining Notice to Garnishee or an Information Subpoena with Restraining Notice. Both require the same level of action to the customer’s account, however, when a restraining notice is served with an Information Subpoena, the subpoena must be completed and returned to the serving entity.
• Requires immediate hold of non-exempt funds in the named customers’ account(s) for the entire judgment for a period of no less than one year (unless the judgment is satisfied or otherwise ordered released by the court prior to that time).
• Requires the Bank to provide a copy of the Restraining Notice, an Exemption Notice and Claim Form to a natural person (personal/sole proprietor’s only) within 2 days of receipt of the restraining notice.
• No more than two (2) restraining notices may be served on a natural person’s account in one calendar year.

EXEMPT FUNDS:
Both Levies and Restraining Notices served on a natural persons account(s) are subject to ONE the following exemptions (business accounts are not exempt):

• $2,500 of an account containing direct deposit or electronic payments reasonably identifiable as statutorily exempt payments - which include all sources of state, federal and local government assistance – within the prior 45-day period; OR
• $1,716 in an account, as such amount is deemed to represent exempt wages.

The judgment debtor has 20 days to return an Exempt Claim form, and judgment creditor has 7 days from the date of the postmarked customer exemption claim to protest and notify the Bank. No funds can be transferred to the sheriff or support collection unit for at least twenty-seven (27) days.


----------------------------------------------

What I am really struggling with is what to do in the event that we get a restraining notice where we have to make exempt funds available, but hold an amount that exceeds the available balance. Our system isn't sophisicated enough to allow us to tell it to make available $2,500 but hold $15,000 for a restraining notice. We're talking about creating shadow accounts or only making exempt funds available by check or branch visit (i.e. shutting down debit card). If anyone has a solution or idea for this exemption provision please post.
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#1169367 - 04/23/09 08:40 PM Re: Restraining Notices in Layman's terms please!!! Compliance Buzz
Compliance Buzz Offline
Gold Star
Joined: Feb 2002
Posts: 319
NJ
Here's one more source document from a telephone seminar we listened to back in November regarding the changes: www.cullenanddykman.com/db30/cgi-bin/pubs/EIPA.pdf
_________________________
My opinion is free: sometimes you get what you pay for; sometimes you get lucky.

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