The majority of the island’s residents are set to receive their COVID-19 stimulus checks issued by the federal government, most likely next month.
The question is: Can your bank garnish your stimulus check if you owe them money?
Under current laws, banks are legally allowed to withhold funds that go into accounts that have negative balances and no specific provision in the CARES Act, the $2 trillion relief package that authorized the stimulus payments, prevents banks from taking customers’ stimulus money to cover debts.
But according to The New York Times, U.S. Treasury Secretary Steven Mnuchin has been fielding calls from U.S. senators urging him to ensure that relief money isn’t garnished.
In addition, more than two dozen State Attorneys General had also requested Mnuchin to reverse the garnishment policy.
Here on Guam, Speaker Tina Muña Barnes has reached out to the Guam Bankers Association (GBA) in anticipation of federal stimulus payments, which local residents are in dire need of during this time of economic downturn.
Speaker Muña Barnes reached out to First Hawaiian Bank’s Ed Untalan, president of the GBA, to ask that banks forego garnishments as residents struggle to put food on the table and pay rent.
According to the Speaker’s Office, Untalan has already responded to the Speaker and stated that “the Guam Bankers Association stands together with the Island in the face of this pandemic and the economic impact it has had on our residents and businesses.”
According to the Speaker, the Guam Bankers Association has committed to not offset or garnish any stimulus checks to cover past due or delinquent loans or credit card payments, including any outstanding charges customers may have.
However, garnishments that are mandated by the courts are not included in this policy.
The Guam Bankers Association is comprised of the following banks: ANZ, Bank of Guam, Bank of Hawaii, Bank Pacific, First Commercial Bank, and First Hawaiian Bank
“Guam is a community where the sense of Inafa’Maolek still lives on. During times like these, it is refreshing to see our community come together for our fellow Guamanians. I would like to thank the Guam Bankers Association for their continued stewardship of our Island Community. We will overcome this together,” the Speaker said.