NC Attorney General hopes to block debt collectors from stimulus checks

The IRS this week began funneling money from the CARES Act, the stimulus package approved by Congress because of the COVID-19 outbreak, into the bank accounts of those who qualify. Most deposits ranged from $1,200 for single people to $2,400 for couples and an additional $500 per child.

Unfortunately for some Americans, banks are required by court orders to garnish deposits.

North Carolina Attorney General Josh Stein is one of several attorneys general hoping to protect those stimulus funds.

"People need money in order to put food on their table, to pay their bills. The $1,200 is meant to help people. It’s not to go to some creditor," Stein said.

Stein and others signed a letter calling on U.S. Treasury Secretary Steve Mnuchin to block collectors from accessing those emergency funds.

"Obviously, the creditors should get repaid, but not from this source of funds. This source of funds is about helping people get by for the next few weeks," Stein said.

Banks must abide by court orders to garnish unprotected funds, but a spokeswoman for Wells Fargo told WRAL that the bank is trying to help the needy in other ways.

"Wells Fargo is pausing for 30 days the collection of negative balances existing at the time when stimulus payments are deposited," she said. Other institutions, including Bank of America and USAA, say they’re taking similar pauses.

In unprecedented times, Stein wants all creditors to take a step back.

"We’re asking anyone who’s owed money, do what you can to give your folks breathing space," he said.