We joined other leading consumer groups in signing on to testimony by the National Consumer Law Center before the Senate Finance Committee yesterday. The hearing concerned whether banks are failing to protect Social Security recipients from illegal and improper seizure of their exempt benefits. The issue has grown in importance as more and more consumers receive benefits electronically. Excerpt from testimony by Margot Saunders of NCLC:

We estimate that on a monthly basis thousands of low income recipients of Social Security, SSI and other federal payments whose benefits are entirely exempt from claims of judgment creditors are left temporarily destitute when banks allow attachments and garnishments to freeze their only assets. As was illustrated in a recent Wall Street Journal article ("The Debt Collector vs. The Widow -- Viola Sue Kell thought her Social Security benefits were safe in the bank. She was wrong."), when a bank applies an attachment 14 or garnishment order to the exempt funds in a low income recipient's bank account, the consequences are generally devastating. There is no money for food or medicine. Checks written for rent or the mortgage are bounced. People go hungry. They get sick or sicker. They suffer anxiety. They are forced to pay steep bank fees and fees to merchants because the checks they wrote when they had money in the bank now bounce.

The banks (backed by their captive regulators, at least until yesterday's hearing), of course, use the first part of the Bart Simpson defense: "it's not my fault, I wasn't there, I didn't do it." More from our joint NCLC testimony: