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13 senators join Harris letter urging Mnuchin to exempt coronavirus checks from private debt collection

13 senators join Harris letter urging Mnuchin to exempt coronavirus checks from private debt collection
© Greg Nash

A group of Senate Democrats is urging Treasury Secretary Steven MnuchinSteven MnuchinOn The Money: Schumer urges Democrats to stick together on .9T bill | Collins rules out GOP support for Biden relief plan | Powell fights inflation fears Mnuchin expected to launch investment fund seeking backing from Persian Gulf region: report Larry Kudlow debuts to big ratings on Fox Business Network MORE to exempt checks being issued as part of last month's $2.2 trillion coronavirus relief bill from being subjected to garnishment by debt collectors. 

Fourteen senators on Friday sent a letter, spearheaded by Sen. Kamala HarrisKamala HarrisDwayne 'The Rock' Johnson vs. Donald Trump: A serious comparison Exclusive: How Obama went to bat for Warren To unite America, Biden administration must brace for hate MORE (D-Calif.), to Mnuchin urging him to issue regulatory rules that would exempt the stimulus checks from private debt collection. 

"There are concerns that the direct assistance checks that Americans are receiving may be subject to private debt collection, which could potentially deprive Americans of essential assistance that they need in order to pay bills and keep food on the table," the senators wrote to Mnuchin in the letter, a copy of which was obtained by The Hill ahead of its release. 

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"We ask you to act right away to use Treasury’s rulemaking authority to exempt Americans’ direct assistance payments from private debt collection so that American families can receive critical assistance to help them get through this unprecedented crisis," they added. 

In addition to Harris, Sens. Dick DurbinDick DurbinPartisan headwinds threaten Capitol riot commission Murkowski undecided on Tanden as nomination in limbo Democrats ask FBI for plans to address domestic extremism following Capitol attack MORE (D-Ill.), Bernie SandersBernie SandersHouse Democrats pass sweeping .9T COVID-19 relief bill with minimum wage hike House set for tight vote on COVID-19 relief package On The Money: Democrats scramble to save minimum wage hike | Personal incomes rise, inflation stays low after stimulus burst MORE (I-Vt.), Chris MurphyChristopher (Chris) Scott MurphyOvernight Defense: Biden sends message with Syria airstrike | US intel points to Saudi crown prince in Khashoggi killing | Pentagon launches civilian-led sexual assault commission Minimum wage setback revives progressive calls to nix Senate filibuster New rule shakes up Senate Armed Services subcommittees MORE (D-Conn.), Richard Blumenthal (D-Conn.), Chris Van HollenChristopher (Chris) Van HollenMenendez reintroduces corporate diversity bill LIVE COVERAGE: Senate set to consider Garland for AG Plaskett quips male lawmakers 'would not have their wives in one attempt talking to her' during impeachment trial MORE (D-Md.), Jeff MerkleyJeff MerkleyProgressives fume over Senate setbacks Ex-Capitol Police chief did not get FBI report warning of violence on Jan. 6 Democrats want businesses to help get LGBT bill across finish line MORE (D-Ore.), Patty MurrayPatricia (Patty) Lynn MurrayOvernight Health Care: 50 million coronavirus vaccines given | Pfizer news | Biden health nominees Rand Paul criticized for questioning of transgender health nominee Biden health nominee faces first Senate test MORE (D-Wash.), Doug Jones (D-Ala.), Sheldon WhitehouseSheldon WhitehouseBiden nominee previews post-Trump trade agenda Tucker Carlson bashes CNN, claims it's 'more destructive' than QAnon Garland seeks to draw sharp contrast with Trump-era DOJ MORE (D-R.I.), Tammy BaldwinTammy Suzanne BaldwinBiden signs supply chain order after 'positive' meeting with lawmakers Democrats want businesses to help get LGBT bill across finish line Democrats offer resolution denouncing white supremacists ahead of Trump trial MORE (D-Wis.), Amy KlobucharAmy KlobucharOpen-ended antitrust is an innovation killer FBI, DHS and Pentagon officials to testify on Capitol riot Five big takeaways on the Capitol security hearings MORE (D-Minn.) and Tina SmithTina Flint SmithSenator notices mismatching shoes at trial: 'I had a lot on my mind' Overnight Energy: Biden administration delays Trump rollback of migratory bird protections | Democrats seek to block further Arctic drilling | Democratic senator pushes for clean electricity standard Democratic senator pushes for clean electricity standard MORE (D-Minn.) signed the letter. 

The coronavirus legislation passed last month provides $1,200 in direct assistance to individuals who make up to $75,000, with the amount scaled down for higher incomes until reaching an annual gross adjusted income of $99,000, where it phases out altogether. An additional $500 per child is also included. 

The letter comes after The American Prospect published audio this week of Treasury official Ronda Kent discussing with banks how they should handle the coronavirus checks if the account holder had outstanding loans or debt. According to the audio, Kent told banks there is "nothing in the law that precludes" the funds from being garnished and it is up to banks. 

Top banking associations also sent a letter to Sens. Sherrod BrownSherrod Campbell BrownSunday shows preview: 2024 hopefuls gather at CPAC; House passes coronavirus relief; vaccine effort continues Democrats: Minimum wage isn't the only issue facing parliamentarian Menendez reintroduces corporate diversity bill MORE (D-Ohio) and Elizabeth WarrenElizabeth WarrenExclusive: How Obama went to bat for Warren Minimum wage setback revives progressive calls to nix Senate filibuster Democratic strategists start women-run media consulting firm MORE (D-Mass.) noting that under the coronavirus bill, "Congress failed to define these payments as benefits subject to preemption from garnishment."

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"As a result, with regard to any legal garnishment, depository institutions have no discretion and are obligated to comply with applicable state laws and court-ordered garnishments," the groups said, adding that Congress should pass language clarifying future COVID-19 payments.  

The senators noted in their letter to Mnuchin that the coronavirus legislation did not directly exempt the direct cash payments from private debt collection, but that it "belies the intent behind the law."

"Treasury has the rulemaking authority specifically to ensure that as part of its process of implementing the direct payment program, it could ensure that the checks Americans were receiving were exempt from private debt collection," they wrote. 

"We ask you to ensure that direct assistance checks cannot be garnished for private debt collection purposes," they added. 

Harris's letter comes as the first round of stimulus checks went out this week for individuals who have authorized the IRS to make a direct deposit into their bank accounts. Senate Democrats, noting that money is already being sent out, asked Treasury to complete any rulemaking to protect the checks from private debt collection by April 24. 

Brown and Sen. Josh HawleyJoshua (Josh) David HawleySunday shows preview: 2024 hopefuls gather at CPAC; House passes coronavirus relief; vaccine effort continues Texas attorney general hits links with Trump before CPAC appearance The Memo: CPAC fires starting gun on 2024 MORE (R-Mo.) sent their own letter last week to the Treasury Department, urging Mnuchin to use his rulemaking authority to protect the recovery checks from private debt collectors. A group of state attorneys general sent Mnuchin a similar request on Monday.