New hope for centralized bank levies in California:
Governor Brown Signs AB 2364 into Law, Centralizing the Location for Service of Levies, Attachments and Garnishments on Financial Institutions. The Consumer Financial Services Committee (“CFSC”) is pleased to report that an Affirmative Legislative Proposal on service of levies and other process on financial institutions that was sponsored by the CFSC has now become law. This will require large banks, and permit smaller banks, to designate a central location where judgment creditors must serve levies, attachments and garnishments on deposit accounts and safe deposit boxes.
The advantage for plaintiffs such as tort victims suing underinsured or uninsured motorists, as well as debt collectors, is that they no longer will have to serve the correct branch of the bank holding the account, a requirement that was a vestige of the pre-computer era. Identifying the right branch bank for service of levies, attachments and garnishments has necessitated the costly use of orders of examination of the debtor and other procedures, and enforcement of money judgments could be frustrated by the judgment debtor’s moving money around. The advantage of the legislation for financial institutions lies in both the efficiency of centralizing this function and the reduced risk of errors by branch bank staff.
The Department of Financial Institutions is required to create a procedure for banks to designate their central locations for service, and to establish a website where judgment creditors can obtain this information. The law goes into effect January 1, 2013.
For the text of the Bill, click here: http://www.leginfo.ca.gov/pub/11-12/bill/asm/ab_2351-2400/ab_2364_bill_20120911_enrolled.pdf
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