Your item number 3 is the issue here of course.
According to the communication from a bank and a credit union, just yesterday, direct deposit of social security funds would be attached without hesitation if there was an attachment ordered by a judge; Another words I think what the legal dept of the bank is saying is they do not want to be in contempt or defy a court order.
Of course, I admit, my situation here does go out on a limb somewhat, because it would be a big question if a judge would actually order to seize an account knowing it is non-attachable social security funds.
With a naive social security recipient and a ruthless creditor, who knows how often this may acutally occur, since banks don't seem, in my state anyway, to offer a "check and balance" against illegal attachment of public assistance.
I have also read somewhere, possibly in the state of NY, there is actually such thing as a pre-judgement garnishment. That I found totally bizzarre. A creditor actually attaches someone's property before a court date acually occurs.(taking someones property before guilt or innocence is determined, seems quite off the wall)
To get back to our topic here, it is not the government here I am concerned about. It is the institution called banks which hold government proceeds intended for public assistance; I saw no sign of caution, by a bank yesterday, regarding obeying an order to hold and seize public assistance funds.
Perhaps communication with someone in FDIC might eliminate confusion here for someone like myself and the banks also.
Well I don't mean to answer my own question here, but I just found this on the internet which means the bank people I spoke to yesterday apparently do not know what they are talking about. Here is what I just bumped into:http://www.allsup.com/personal-finance/financial-planning/protecting-ssdi-benefits-from-creditors.aspx
another good source here is:http://www.cleveland.com/business/index.ssf/2011/05/creditors_restricted_on_freezi.html
Protecting SSDI Benefits from Creditors
In most cases, federal law makes it illegal for creditors to touch your Social Security Disability Insurance (SSDI) payments without your permission. This is also true for Social Security retirement benefits, Supplemental Security Income (SSI) and many other federal benefits.
The big exception to this rule is the federal government itself. The government can hold back a portion of your SSDI payments to make up for taxes or other debts you owe to the federal government, as well as unpaid child support or alimony.
What happens if a creditor tries to seize a bank account where I deposit my benefit payments?
If you have defaulted on a debt, your creditor or a debt collector may get a court order to take money from your checking or savings account to pay the debt. This court order is called a garnishment order. Debts can include unpaid credit card bills, utility bills, medical bills or loans.
If you have any Social Security payments in the account, the creditor cannot legally take these funds. Federal rules require that your bank or credit union take some steps to identify and protect the Social Security funds in your account.
Here’s the bottom line: Your bank or credit union must automatically protect any Social Security payments that were electronically deposited into your account during the last 60 calendar days. If you have any Social Security funds in your account beyond that amount, you’ll have to prove it to the court to get the rest of your money back.
Here are the details of what your bank or credit union is required to do:
When your bank or credit union receives the garnishment order, it has to determine if any federal benefit payments were electronically deposited into your account during the last 60 calendar days.
Then, it has to make sure you have access to a “protected amount” of your funds. The protected amount is the sum of the federal benefits deposited into your account during the 60-day window. Or, if your balance is less than the sum of these payments, the protected amount is the remaining balance of your account. You may use these funds as you normally would. The idea is that you should have about two months’ worth of benefits to live on.
If your account contains more money than the sum of the benefits deposited during the 60-day period, these funds are subject to the court order. They may be frozen or turned over to your creditor. If you think that these additional funds are also federal benefit payments, you will have to follow a legal procedure to get this money back.
What is really frustrating and confusing is the legal dept of the banks or credit unions I spoke to, apparently have no clue of the above federal rules and regulations passed in May 2011