New law keeps debt collectors from accessing stimulus funds

As $600 economic support payments begin hitting Virginians’ bank accounts and mailboxes, a new law in the Commonwealth is aimed at keeping debt collectors from using the funds as collateral. The bill was passed in this year’s special legislative session after it was discovered that the initial round of $1,200 support payments issued by Congress as part of the CARES Act was left vulnerable to seizure or garnishment.

In the 2020 COVID and Criminal Justice Reform Special Session, the General Assembly passed HB5068 with bipartisan support. The bill exempts state and federal emergency relief payments from garnishment, attachment, and other legal creditor process seizures. It included an emergency clause ensuring it went into effect immediately upon Gov. Northam’s signature.

If anyone believes their economic relief payment has been unlawfully garnished or seized, they should assert their rights under “§ 34-28.3. Emergency relief payments exempt.” directly with the relevant collections agency or financial institution. Virginians can also reach out to Attorney General Herring’s Consumer Protection Section for additional information and assistance if they believe their payment has been illegally garnished.

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