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Fraudulent Check in Social Security Direct Deposit

Answered by: 

Question: 
We have a customer that has deposited a fraudulent check to an account that only receives Social Security direct deposit. Do we have the right to charge the check back to that account?
Answer: 

I'm assuming your concern is that, as a federal benefit payment, the proceeds of the SSA payments the account receives are exempt from levy or garnishment.

When you debit the return item back to the account, you are not levying or garnishing the account. You are revoking a provisional credit that you gave when the fraudulent item was deposited. The prohibition does not apply.

First published on BankersOnline.com 10/17/11

First published on 10/17/2011

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