I am a Judgment Broker, not a lawyer, and this article is my opinion, please consult with a lawyer if you need legal advice. A new law, 31 C.F.R. Section 212.5 (A Federal law) gives banks two days to respond to a Sheriff levy, a change from the previous same day response they were required to perform.

During the two days, the judgment debtor has full access to their bank account and can take out all the money, if the bank lets them know about the levy before it takes effect (which unfortunately happens more than occasionally).

Do banks tell their best customers about levy attempts? Most judgment enforcers say yes, it has happened to them. They say sometimes banks openly and regularly hold up freezing accounts until they notify their depositors about the levy, so they can withdraw funds before the bank freezes the account.

One way to look at the new law is the system is well represented by the courts with judges who can make logical decisions based upon careful review of the facts.

The law was very much needed. There are lots of amateur judgment enforcers who take the position: “I will grab what I can, disrupt the debtor however possible, and it will be his problem.” Even though the protected funds listed in this CFR laws are, in some cases, exempt without making a claim; which means that the debtor should be protected, it does not always work out that way.

This law was an obvious fix that was needed in order to ensure such exempt funds were not taken (nor frozen), and that the banks would not incur liability for a reasonable delay in determination thereof.

Many levies fail due to legitimate claims of exemption. However, this legislation does nothing to protect the rights of those that have legitimate claims against funds held by bank with no such exemptions. It helps banks protect their customers.

If the funds are not exempt, and they disappear before the two days are up, there should be some recourse. Why should the funds not be frozen during this period? That would assure both sides of an equitable outcome. The law protects one side (the debtors) without thinking of the other side’s (the creditors)interests.

Another way to look at this law is that 31 C.F.R. Section 212.5 was written too broadly. It offers balance to all, perfection to none. If a bank warns their account holder, and the account holder withdraws the funds and then the bank reports to the Sheriff there were no funds at the time of the levy, and that is outright fraud.

Now banks have two days to mess up your levy. This law is nonsense, and is unneeded legislation as it is not the bank’s nor the government’s problem. Under the old law or 31 C.F.R. Section 212.5, the debtor could always object to the levy and if any of the funds were exempt, the judge could rule accordingly.