Banks Threaten To Steal Stimulus Checks While Millions Struggle

Via America’s Lawyer: Provisions in the Coronavirus relief bill allow for banks and private lenders to snatch stimulus checks from people with outstanding loans. Mike Papantonio and Farron Cousins discuss.

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*This transcript was generated by a third-party transcription software company, so please excuse any typos.

Millions of Americans are struggling to get their stimulus checks, but even if they can get through the IRS website, they could still have banks steal their money. Joining me to talk about this is Farron Cousins, editor of the national trial lawyer magazine. This, this story again, it's no surprise, right? This whole little, the whole nature of this legislation was to put money in hands of people so they could eat. So they could pay their rent. Now all of a sudden we see the threat of banks saying what?

Well, the banks are saying, hey, you have overdraft fees from a couple of years ago. Oh, you're behind on this payment that, you know, this debt that we hold for you, we're going to steal your money. And the worst part about this is not just the fact that the banks are doing this, it's that this was intentional. This was intentionally put into this piece of legislation because they wrote in a provision, Congress did as part of the stimulus package here, that the federal government cannot seize any of this if you owe the government any money with the exception of child support. But they didn't include that provision for banks. Instead, the rule says we're going to leave it up to the treasury run by Steve Mnuchin, the banker. He'll decide if banks are allowed to take your money and of course Mnuchin did the very predictable thing, which was to say, absolutely banks, if somebody owes you money, this stimulus check is going right into their account at your bank. You can go ahead and keep it. That is what they explicitly told the banks, Ronda Kent.

Exactly. Let me give you the backstory a little bit more. Treasury department is having this massive webinar telephone conference with banks all over the, all over the US and they say, by the way, is it okay if we take this money that comes to us, the $1,200 check, and if they owe us money on overcharges, or they owe us money on delinquent payment on a loan that we can take that money and then real cutesy, she says, well, you know, there's nothing explicit that says you can't. In other words, you're right. They understood this when they went into it. Mnuchin understands that he's looking out for the banks. The whole concept of this is A, put money in hands of people who have to pay for things like food and rent or whatever they might, their needs. B, what that does is it empowers the economy. Okay. You got what, $350 billion worth of money flowing through here? Is that this?

This was the half billion.

The half billion.

So it's about half a billion.

Okay, so the money's flowing through, but I'm talking about the total money that's flowing through the entire process.

Right, right, right.

So, the money's flowing through and the notion of it is brilliant for the first time because it is saying we don't really want to worry about trickle down. Trickle down doesn't work. It's a lie. When a corporation gets their money, they buy their shares back, none of that money goes into the economy. And now maybe they've embraced the notion because they've been forced to that trickle up makes a lot more sense. If you put hand, money in the hands of somebody who's going to go buy something, really is going to engage with the economy. That's what boosts the economy. Not these folks at the top, this corporate elite at the top. They don't, they're not gonna buy anything. They, you know, how many Bentleys can they have? I mean, how many shares can they own in their corporation? So, the point is this actually had a good idea behind it. The idea was empower the bottom, let them pay for food, let them pay for rent or whatever, and that money trickles back into the economy. Right?

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