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Charley’s Note About Identifying and Acting Against Property & Assets of Self-Employed and Unemployed Individuals

December 31, 2010

A Note From Charley’s Desk

Child Support. Collections. Contempt. Criminal Non-Support. It all makes my head spin, especially given the fact that my ex-husband owed me over $45,288 as of 2002, and that figure having doubled through a 1o% simple interest accruing over eight (8) years, I cannot for the life of me understand how and why he is not in jail this very moment. Especially when he was before the court on five separate occasions on Contempt charges for the period 1997 through 2002.

My investment over time actually paid off. As of 2009, child support and alimony accrued mandatory simple interest at the rate of 10 percent per annum. As of April 2009, he owed me about $140,000 in judgment principle still owes me $50,000.

As I navigate through my own child support collection nightmare, I invite you to monitor my progress. I am requesting help from Frederick Maryland State’s Attorney’s  Office of Child Support Enforcement. Let’s see how the office stacks up against the other states as outlined in the report which follows this note.  I was hoping that Channel 7 on Your Side, The Washington Post, and The Frederick News Post would get wind of my story. My tale is true and weaves a mesmerizing web of deception, violence, fraud, corruption, and pain. It certainly is newsworthy.

So, stay tuned, but meanwhile, why not read about what other states have been doing to enforce child support. I give you the U.S. Department of Health & Human Services’ Administration for Children & Families, The Office of Child Support Enforcement’s OCSE Best Practices on how to collect from deadbeat dads. I decided to compare Maryland’s ability to prosecute this case to the fullest extent of the law. Will my State’s attorney have the same gumption and drive to make a criminal conviction and example of this deadbeat dad?

The Office of Child Support Enforcement’s motto is, “Giving Hope and Support to America’s Children.”

Tell that to my dead son, who only a few weeks before committing suicide [by putting a loaded .45 caliper to his head and pulling the trigger], told me,

“Mom — Dad has the money to pay you. I don’t know why he thinks he can go on vacations all the time and have a bastard child with a stripper whore before paying you, and not being responsible for his first four kids. Go get it. Just go get the money, Mom. You definitely know how to find it.”

Before he hung up with me that evening, he told me,

“Mom, I love my Dad. But he has taught me what kind of man NOT to be. I hope you know that. I’m not like him. And, I’ll kill myself before I ever hit a woman.”

My beloved son was 23 years old. He shot himself in the midst of what most adults would call a normal a domestic argument with his younger girlfriend. You see, this was only his second girlfriend ever since kindergarten. The lover’s quarrel alone is not what pushed my son over the brink of sanity to commit such an act. He shot himself at his father’s house — his father who is prohibited under Federal and State domestic violence gun laws to have or possess guns, his father who tried to kill me with his bare hands on Easter Sunday of 1996 — the man who still owes me child support for my dead 23-year-old young son (and his two younger adult sisters) and caused my children to be deeply ashamed of their own father — the father my son wanted to move away from, and the father he no longer wished to work for, and the father who he knew is a liar because he finally grew up and got curious enough to investigate court records on his own. The truth must come out.

I dedicate this article to my son. I love you, Michael.

 

 

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OCSE Best Practices


ENFORCEMENT:  Identifying and Acting Against Property and Assets of

Self-Employed and Unemployed Individuals

Publications Archive

This is a Historical Document


In 1991, Virginia implemented a program targeted at individuals who are self-employed or employed “unofficially.”  The program is called SAFE (Seize Assets for Enforcement) and has been very successful.  The strategy was two fold:

  • to actually seize and sell assets for delinquent child support; and
  • through publicity, to motivate many non-payors to make payments.

For the fiscal year 1992-93, over $394,000 was collected through May 15, 1993.  This represents monies collected through actual sheriff’s sales, as well as lump sum payments and wage withholdings obtained as a direct result of letters of intent and referrals to the sheriff’s offices.  The process involves sending an Intent Notice to obligors who are delinquent in the amount of at least $1000.  This notice advises them of the State’s intent to seize and sell at public auction their personal property to satisfy past-due child support and directs them to contact DSS within ten days to make payment arrangements.

Many contacts are received subsequent to the mailing of the notices.  In addition, a tape match is periodically run with the Department of Motor Vehicles and Game and Inland Fisheries for vehicle and boat ownership information.  Of course, many clients also provide leads, such as an obligor’s owning valuable antiques or an expensive sound system. Contact Julie G. Cooper, Assistant Director, Program Operations at (804) 692-1944.

The Connecticut Parent Locator and Capias Unit uses the resources of the Departments of Labor and Revenue Services in locating self-employed obligors’ sources of income. The state child support agency just entered into an agreement with the State Department of Revenue Services to provide access to obligor’s tax returns.  Additionally, the agency and local magistrates use computers to match obligors with state lottery winnings, motor vehicle registrations, mortgages, etc. Contact Paul Burns, Supervisor, State Parent Locator & Capias Unit at (203) 566-7075.

A portion of the obligors in Alaska are self-employed fishermen who hold state issued permits to allow them to fish within Alaska waters. Each fishing boat must have a permit holder on board while fishing and only permit holders may sell to processors.  The Child Support Enforcement Division (CSED) computer matches the obligor database with the State Commercial Fisheries Entry Commission’s database of permit holders and a mass order for income withholding is produced.  The mass order is:

  • served on all processors, brokers and individuals authorized to purchase fish from permit holders;
  • valid for 13 months; and
  • is replaced annually.

It contains the name, permit number and arrears of each obligor.

Purchasers of fish are required to withhold 50 percent of the sale, not to exceed the arrearage, from the proceeds going to the permit holder.  State law holds an employer (processor/buyer) responsible for the entire child support debt if they fail to withhold from the fishing proceeds.  Processors and fishermen are encouraged to work with the case officers to ensure payment of child support.

Alaska has over 400 fishermen owing more than $10 million in arrears.  This is the fourth year of the mass withholding program and collections increased over 200 percent from 1990 to 1993, from $190,000 to $598,000.  This is the only effective method to collect on these cases in an industry that is primarily a cash business.

Contact Carroll Schmidt, Enforcement Manager, at (907) 263-6900.

The Circuit Court of Escambia County, Florida has implemented the “Pay or Appear” Program, designed to encourage obligors to make timely child support payments. It is aimed specifically at NCPs who: are self-employed; quit jobs when faced with income deduction or change jobs frequently; or who make lump sum payments of arrears to avoid court appearances.

The defendant is issued a “Pay or Appear” Order to pay weekly by a set date. If payments are not received by that date, the defendant must appear before a hearing officer (HO) the following day to show cause why he or she should not be held in contempt.  The defendant is also required to conduct a job search every time he is unemployed or unable to make the required payments.  If the HO does not feel adequate reason has been provided for failure to pay, the case is heard by a Circuit judge that morning.  If the defendant fails to appear for the hearing, an arrest order is issued.

As of July, 1993, 183 NCPs were involved in the program.  Of these, 88 (48 percent) were paying regularly.  Between December 1992 and July 1993, 53 arrest orders were issued, 18 NCPs were arrested, nine of whom paid immediately, nine who were incarcerated.  During that period, eight NCPs were incarcerated directly from the courtroom.  All paid immediately.

Contact Walter Steigleman, Contract Attorney, at (904) 244-5678.

Arizona utilizes several types of actions to enforce child support orders of self-employed obligors.  These include:

  • Order of Assignment, which has been surprisingly effective in the collection of current child support and arrears, even though the obligor is self-employed;
  • In-office stipulated judgment and order, in which the obligor voluntarily comes to the office to stipulate to a money judgment on the arrears. The judgment is recorded with the County Recorders and attaches to the obligor’s property.  Obligors often pay off these judgments, especially when they desire to refinance property at the current interest rates;
  • Civil contempt, in which the obligor is required to appear before the court for a determination of whether he/she is in contempt of court.  These actions are especially effective when the self-employed obligor holds a professional license.  Arizona statutes allow the child support agency to refer the nonpaying obligor to his/her professional licensing board.
  • If the obligor continues to Criminal complaints, several of which have been filed against self-employed obligors based on continuous avoidance of the duty to pay.
  • Credit bureau reports, motor vehicle ownership and past wage histories have been used in these cases to provide proof of the ability to pay.  Generally, the publicity generated by these cases encourages other self-employed obligors to meet their obligations.

Contact Kim D. Gillespie, Dep’t of Economic Security, Phoenix at (602) 274-7646.

In Oregon, the family support division’s first approach to the self-employed obligor is to do a judgment debtor examination (JDE). A review of the past three years tax returns, business records and invoices can produce a great deal of information.  Bank garnishments of business and personal bank accounts may be the next step.  Garnishments can also be sent to prospective contractors (individuals for whom bids are in to do jobs, repeat accounts, etc.). The JDE may be continued on a monthly basis with the obligor to report in with business and financial statements and a payment at each visit.

If these procedures do not bring results, the division initiates a contempt of court proceeding. Oregon sentences vary but can include probation for several months with terms and conditions to be a monthly payment of current plus a specified amount toward arrears, to be paid during the monthly report date.  Generally, a sentence includes possible incarceration which is executed when failure to comply occurs.  Failure to cooperate and comply results in probation violation action.

Contact Carol Anne McFarland, Deputy District Attorney, Oregon City, (503) 655-8469.

In any case where income withholding is ineffective due to the obligor’s method of obtaining income, the court shall order the obligor to identify a child support deposit account owned solely by the obligor, or to establish an account, in a financial institution located in Minnesota for the purpose of depositing court-ordered child support payments.

The court shall order the obligor to execute an agreement with the appropriate public authority authorizing transfers from the obligor’s child support deposit account payable to an account of the public authority responsible for child support enforcement and to disclose to the court all deposit accounts owned by the obligor in whole or in part in any financial institution.

The court may order the obligor to disclose to the court the opening or closing of any deposit account owned in whole or in part by the obligor within 30 days of doing so and to execute an agreement with the appropriate public authority authorizing transfers from any deposit account owned in whole or in part by the obligor to the obligor’s child support deposit account if necessary to satisfy court-ordered child support payments.

The court may order a financial institution to disclose to the court the account  number and any other account identification information regarding accounts owned in whole or in part by the obligor.

An obligor, who fails to comply with this section, fails to deposit funds in at least one deposit account sufficient to pay court-ordered child support, or stops payment or revokes authorization of any transfer is subject to contempt of court.

Cite: 518.611, subd.2a.

Contact Jim Olsen, Minnesota Department of Human Services at (612) 296-2538.

In determining income of self-employed individuals, Colorado uses the Schedule C form normally filed with the individual’s personal tax returns. A review of this Schedule will give an indication of the individual’s personal income for purposes of child support evaluation. Line 31 “Net profit (or loss)” represents the income from personal business. This line is carried forward to the form 1040 personal tax return with any other sources of income an individual may have.  The amount on line 31 is really the amount of income one should begin with as the individual’s income, rather than an amount the person may give as his or her “salary or draw” from the business.  The amount on line 31 is the individual’s income for tax and social security purposes. Even so, there are some possible variations of this amount that should be considered when evaluating income for child support calculation.

These exceptions and variations are listed with the corresponding line number from the Schedule C for reference. The Colorado Child Support Guideline (CCSG) specifically excludes “the accelerated component of depreciation” and investment tax credits”.

The CCSG also requires that “expenses … should be counted as income if they are significant and reduce personal living expenses.” The last requirement is somewhat less objective.  The Colorado Modification Project compiled a list of some expense items on the Profit or Loss from Businesses, Schedule C tax return, which might fall into the area of “reducing personal living expenses,” and thus should be reviewed more closely.

Contact Vikki Schwartz-Williams, Policy Studies, Inc., at (303) 863-0900.

Tax returns of self-employed persons often show a gross income reduced to minimal levels by business deductions.  On the other hand, persons who apply for loans never underreport their income or deflate the value of assets. If anything, income is accurately reported, and all assets are disclosed and their value exaggerated.

Subpoenaed mortgage applications from institutions to which self-employed obligors have made application are a gold mine, because they often disclose secreted assets and are a fertile ground for contradicting tax returns, for proving income, adducing testimony about assets, and for impeachment.

From the Delaware Deputy Attorneys General’s Conference. Contact Pete Feliceangeli at (302) 577-2760.

It is often useful to subpoena information on bank loans for homes, farms, automobiles, boats, etc. As previously stated, the income reported for loan applications is often higher than the income alleged for support orders, so even the threat of subpoenaing information can be helpful.

Obligors do not want their banker to know that they are behind in their arrears, or that they may have a child support order that they did not report.  This threat may force an obligor to come to the child support agency and make arrangement to fulfill his or her obligation.

Contact Thomas Malier, Corporation Counsel, State of Wisconsin at (715) 524-3181.

Review all property settlement documents from divorce cases to discover whether any important assets were transferred to the obligor.

Run credit bureau checks on all supposedly unemployed obligors.  Cull out those that reveal significant bank loans, car loans, mortgages, etc.

Run a credit bureau check on the obligor’s new spouse if nothing is revealed under the obligor’s name but the obligor appears affluent.

From the Maryland Prosecutors Seminar, May 1993.

Contact Amy Bernstein Robertson, Special Counsel, Prince George’s County at (301) 952-4823.

Income may be available in checking and savings accounts, inheritances and trusts, interest and dividend income, individual retirement accounts, rental income, royalties, life insurance  benefits, scholarships and grants, sales of  property, gambling winnings, prizes, lottery, awards, cash in registers, and property held by the business.

Oregon child support agencies use the Oregon wage guide to see what the average pay would be for a particular occupation.  Banks, credit unions, county records, subpoenas for bookkeeping records, tax records, till taps on registers, and most importantly, the CP are all excellent resources for obtaining the asset information.

Contact Christine Nelson at (503) 776-6043.

In Wisconsin, the best source to locate information about self-employed obligors is tax records, which may be obtained through the state department of revenue. On a limited basis, the Bureau of Child Support is permitted to examine tax records to obtain income information.

The bureau must submit the obligor’s name and social security number via IRS Project 1099 for a check of wages and unearned income. The drawback is that there is no way to determine if the information has been correctly reported.

The agency also has direct access to the Wisconsin Department of Industry, Labor and Human Relations files to determine if the obligor is receiving unemployment benefits, how much the grant is and where the check is sent.

The agency can also determine if the obligor is employed, by whom and what his or her reported quarterly earnings.

Contact Mary L. Southwick, Director, Bureau of Child Support at (608) 266-9909.

In Adams County, Washington, the first paternity, support and reimbursement for expenses (i.e., retroactive support) action was recently litigated wherein the obligor was currently receiving workers’ compensation time-loss payments. Time-loss payments are for earnings lost because of an injury. The CP was non-assistance and the retroactive support was solely for the CP.  The back support amount requested exceeded $11,000. The claims manager testified at trial that it was more likely that the claimant would be determined to either be employable or need vocational training. Based on the claimant’s injury, medical record of treatment and surgeries, a cash settlement would be awarded. The court granted the request for retroactive support and ordered the Department of Labor and Industries to notify the Adams County Prosecutor’s Office of Support Enforcement when the obligor’s workers’ compensation claim was resolved.

In another paternity and retroactive support case in which the claim was already resolved but the settlement was still pending, the judge ordered the retroactive support amount requested, and  specified that this amount should be paid from the pending award. An interagency lien between Labor and Industries and the Office of Support Enforcement was entered on the pending award.

Contact Cecilia K. Cervantes, Deputy Prosecutor, Adams County at (509) 488-2064

In a recent case in Illinois, the appellate court approved the use of the guidelines for allocating a workers’ compensation settlement. In 1987 an obligor received a net award of over $108,000.  The obligee filed a petition asking the court to allocate part of the worker’s compensation settlement for current child support. The trial court held that since the obligor had converted his right to receive periodic payments to receive a lump sum payment, the settlement was “income” and subject to apportionment for child support. The trial court ordered him to pay a percentage of the net award for current child support.

He appealed the issue of whether the settlement was “income” subject to child support award. The appellate court affirmed the decision and held that the lump sum settlement was income under the child support guidelines.

Cite: In re: Marriage of Dodds, 222 Ill. App. 3d 99, 583 N.E.2d 608 (2nd Dist. 1991), cert. den., 591 N.E.2d 20 (1992).

Contact Aprille Cooke McKay, Assistant State’s Attorney, Kane County at (708) 232-3500.

Upon learning that an obligor was to receive a large settlement from a worker’s compensation claim, the Petersburg, Virginia child support office initiated an Order to Withhold and Deliver.  A check for $12,600 was sent promptly.  Every penny went to the family.

Contact Victor Taylor, Enforcement Specialist, at (804) 862-6134

Benefits available through Title II of the Social Security Act (not SSI) inuring to child support obligors are specifically listed as being subject to attachment. Such benefits include, but are not limited to, disability income (SSDI), retirement income and widows’ benefits (including lump sums). To attach benefits, one may serve, by certified or registered mail, the garnishment or income withholding order on the office manager at any Department of Health and Human Services (DHHS) district or branch office regardless of the location of the support debtor.

Although up to 65 percent of the periodic benefit is subject to attachment, one should exercise discretion when attaching Title II benefits. The Title II benefit is, in many cases, the only income the obligor may have. Often, a separate benefit will be paid directly to the child by the Social Security Administration. Some states will allow the obligor a credit on current support owed for these payments. In such cases, collection activity is primarily focused on arrearage collection and nominal monthly attachments of $30 to $50 may be appropriate.

A useful case is Mariche v. Mariche, 243 Kan. 397, 758 P.2d 746 (1988), which supports the position that Social Security disability benefits paid in a lump sum and deposited in a bank account are subject to garnishment and the percentage limitations of the consumer credit protection act do not apply to limit the amount attachable.

Cites:

  • Authority for attachment of income inuring to support obligors from the U.S. Government: 42 U.S.C. 659, further explained at 5 C.F.R. 581.103, which lists types of income subject to  attachment;
  • Periodic benefits, as defined in section 428(h)(93) of Title 42 of the United States Code, Title II of the Social Security Act (not SSI) specifically listed as being subject to attachment: 5 C.F.R. 581.103(c)(1); and
  • Service of garnishment or income withholding process on DHHS district or branch office: 5 C.F.R. 581, Appendix A.

Contact Audrey B. Magana, Court Trustee, Geary County, Kansas at (913) 762-5348

If the obligor is a partner in a business, the partnership’s assets are not directly available for satisfaction of the judgment or order, usually not even the obligor’s share or interest in the assets, until that interest is segregated as money that can be distributed to the partner as “profits.” A fairly elaborate procedure must be followed to get at the support obligor’s interest in the partnership.

In California, partnership asset attachment is done pursuant to a noticed motion for a charging order. Each of the partners must be served with the notice of motion which enables each partner to protect his or her own interests and creates a lien on the support obligor’s interest in the partnership.  The effect of a charging order will be to transfer the interest of the support obligor to a receiver.

The court can then direct the receiver to do a variety of things to satisfy the support obligation, including receive funds or assets which would otherwise have been distributed to the support obligor by the partnership, and sell the interest of the support obligor in the partnership. At any time before the foreclosure sale of the support obligor’s partnership interest, the partnership may redeem that interest.  If the business of the self-employed support obligor is in corporate form, then a number of steps can be taken.  Many may be taken concurrently.  A wage garnishment order should be served on the corporation.

In California, the effect of serving the garnishment on the corporation is to create a lien on the corporation’s assets to the extent that the corporation does not comply with the garnishment. In the likely event of non-compliance with the wage garnishment, an independent action against the corporation to foreclose the lien created by service of the garnishment should be commenced within a few months after serving the garnishment, if not sooner.  The lien on the corporation’s assets expires after one year, but the amount of the lien is determined by the amount of earnings which the corporation should have withheld but did not withhold. Depending on the amount of arrearage and the earnings level of the support obligor, you may want to file quickly or you may want to let the amount of the lien grow.

In California, one should seek a turnover order from the court directing the support obligor to turn his share certificates over to the levying officer, who can then be instructed to sell them at an execution sale. At the same time as application for a turnover order, a restraining order should be sought from the court directing the corporation not to transfer its assets other than in the ordinary course of business, nor to transfer funds to the support obligor other than by payment of earnings paid in compliance with the previously served wages/garnishment.

The object is to try to preserve the assets of the corporation whose shares are to be sold in the execution sale, and prevent conversion or fraudulent conveyances. In most cases it is appropriate to seek an ex parte temporary restraining order to add to the support obligee’s protection until a hearing can be held on the request for a turnover order and other relief.

One may seek an order appointing a receiver to administer the assets and revenues of the corporation and may wish to join the corporation as a joint obligor.  Since the joinder of a support obligor’s private or closely held corporation is often necessary to the enforcement of a support judgment, the court has the power to join the corporation and make appropriate orders in aid of execution.

One may want to file a fraudulent conveyance action against the corporation, naming the support obligor and the corporation as well as any other persons who participate in the process of using the corporation to shield the assets of the support obligor. Conspiracy and other tort counts are often appropriate.

Contacts: Dennis A. Cohen, Center for Enforcement of Family Support, Los Angeles at (310) 399-6776, AND Keith M. Clemens, Court Commissioner, L.A. Superior Court at (213) 974-5598.

In Washington, when the agency determines that an obligor is unemployed, it sends a withholding order immediately, regardless of whether the obligor has begun to receive compensation.

The agency will also try to determine where an obligor has his or her bank accounts or where he or she has applied for loans (usually by requesting a credit check) and then place a lien or withholding order on those assets.

Contact Bob Withrow at (206) 586-3318

In California, if an obligor’s proprietorship is a retail-type business, one effective remedy is a till tap. To carry out a till tap, the levying officer comes into the business and literally cleans out the cash register.  The till tap not only collects money owed to the judgment creditor, it tends to bring the seriousness of the support obligation to the attention of the support obligor in a dramatic fashion.

A related process is to have the levying officer install a keeper who collects and opens the mail and takes the checks payable to the business.  A keeper can be installed for a limited period (e.g., 8 hours or 24 hours) or indefinitely.  Instructions can be given that if the judgment is not satisfied after a specified time period (typically three days), the keeper is to take the inventory and/or equipment of the business into his possession and sell it at auction to satisfy the support judgment.

To levy on an account receivable or other general intangible, one needs to know the name and address of the account debtor. The levying officer then serves a copy of the writ of execution and a notice of levy on the account debtor.

Contacts: Dennis A. Cohen, Center for Enforcement of Family Support, Los Angeles at (310) 399-6776; Keith M. Clemens, Court Commissioner, L.A. Superior Court at (213) 974-5598.

A useful way to intercept money from self-employed obligors in Washington is by going through their safety deposit boxes at their banks.  If there is reason to believe that the obligor has some jewelry or important papers that might lead in the right direction, a subpoena to the bank will open the box.  It costs the office $150 to open and replace the key.

Contact Paul C. Stevens, Support Enforcement Officer at (206) 696-6391

The February 1993 edition of the Child Support Report features several articles on review and adjustment topics. They include a discussion of the federal regulation effective October 13, 1993; information on how to identify assets, including those of self-employed parents; research findings; recent court cases concerning “change in circumstances” related to State guidelines and a reading list on order adjustment.

Copies are available from OCSE’s National Training Center at (202) 401-9383.


Actions Against Property, Assets, Etc.


In Connecticut, the Department of Revenue uses a list of lottery annuitant winners to search for obligors owing child support. For all cases with a match, the process is used to place liens on the winnings.  Each quarter, an updated list of lottery annuitant (million dollar) winners is matched against the files of obligors owing child support.  The State currently has six such liens in place, and collected $14,000 during State FY 1992.

Contact Maria Giaconia at (203) 566-1830

Since the Florida lottery began in 1988, prize winners of $600 or more have been checked against the names of parents who owe child support. Matches are verified and delinquencies are certified.  The winner is advised of the certification and that the prize will be forwarded to the State comptroller for processing.  The comptroller pays the winner any balance beyond the child support owed.  After complying with administrative hearing requirements (s)he forwards the prize or certified portion to the Child Support Enforcement Program.  In State fiscal year 1992, lottery intercept collections totaled $157,638. (PA: $84,768; Non PA: $72,871).

Contact Reeta Das at (904) 922-9582

Effective July 1991, Vermont legislation enables the IV-D agency to intercept lottery winnings.  The IV-D agency manually matches a computer listing of delinquent payers against the lottery agency’s winners listing.  In the two years the Lottery Intercept has been in effect, over $30,000 been collected.

Cite: 15 VSA 792.

Contact Tom Rotella at (802) 241-2938

A 1992 California law authorized a program to test the effectiveness of the Franchise Tax Board (FTB) in collecting delinquent child support payments in the same manner that the FTB collects delinquent personal income taxes. The FTB, the California Department of Social Services (DSS) and six county district attorneys are cooperating in designing, testing, and implementing the program.  The counties will refer child support cases that are at least 30 days in arrears to the FTB for collection.  FTB collection actions such as attachment, execution, and assignment will be used.

Thus far, progress has been good.  The DSS and FTB have signed an interagency agreement defining roles and responsibilities.  Recently the FTB completed a test run of 1,100 cases.  Total collections resulting from that test has reached $250,000. (See  California Pilots Enforcement Using Tax Authority” in the Child Support Report, April 1993.)

Contact Royce Briggs at (916) 657-2038

In Washington, the Child Support Enforcement Program has collected over $1.8 million through property seizures or threat of seizure. Of that total, over $1.6 million was derived from a combination of liens and warning letters.  In 54 cases where liens and earnings did not prompt payment, over $252,000 was collected by selling seized property (e.g. cars, boats, motorcycles).  It has become more apparent that the true collection potential of the program is not in the seizure and sale of individual assets, but in the combined of a vehicle lien and a warning letter. In 1992, the state filed 1002 liens; the previous year they had filed 219 liens.  Using a lien and a Certificate of Title, the child support agency becomes listed as the legal owner (secondary, if a primary legal owner with a vested financial interest is indicated).

The Department of Licensing issues a cancellation of title letter to both the responsible parent and the primary lienholder if one is listed.  This letter lets the interested parties know that the Office of Support Enforcement now has an interest in the asset. (See “Seize and Sell in Washington” in the Child Support Report, August 1991.)

Contact David Orr at (206) 586-3283

The Child Support Enforcement Division unit in Escambia County, Alabama garnished a NCP’s Individual Retirement Account worth over $16,000, which was used to apply to both AFDC and non-ADC arrears. Alabama’s State Parent Locator Service had discovered that the NCP had an IRA life insurance benefit in a local bank.  This came from a 1099 search request to the IRS.  Several steps were necessary to garnish this account:

  • In Alabama, it is necessary to reduce arrearages to judgment before depriving the NCP of property so a judgment for over $25,000 was filed against him in Circuit Court;
  • A district attorney’s subpoena was issued to the bank;
  • A Circuit Court Judge signed a judgment directing the bank to send the court the sum they presently held to satisfy a portion of the plaintiff’s judgment; and
  • The sheriff served the order and notice on the garnishee, while the NCP was notified by regular mail at his last known address.  Neither the bank nor the NCP attempted to establish any defenses.

Contact Mike Godwin, District Attorney, Escambia County at (205) 867-0239

*In Pima County, Arizona, money raised by selling cars and other property helps pay child support to CPs. Initially, the Office of Child Support Services goes to court and obtains a money judgment for child support arrears.  Then a writ of execution is issued for the Sheriff’s Department to seize the property.  A vehicle worth $1,500 or less is exempt from seizure, but, if the parent owns more than one vehicle, the second can be taken no matter what the value.

Other exempt items include homes worth $100,000 or less, televisios, stereos, refrigerators and most furniture, although things like satellite dishes and VCRs have been taken.  A vehicle is easy to seize and sell.  The department evaluates how much the seized items will likely yield, deducting the cost of the sale to determine whether a forced sale is worthwhile. Selling someone’s car for child support payment is a last resort measure.  Usually, after an obligor’s property is seized, the obligor pays the arrearage and gets the property back by borrowing money or taking a second mortgage on the house. The idea is to let parents know that the State is serious about child support enforcement.

Contact Gayle Eskay, Pima County at (602) 622-7000

*The child support agency discovered that an obligor owned a house in Manatee County, Florida, free and clear of any mortgage. After the agency recorded a certified copy of the judgment and obtained a lien on the property, the obligor to the office and made an agreement to pay off the judgment.  After he failed to follow through with the agreement, the agency filed an execution and instructions for levy against his property with the sheriff’s department. After proper notice, the sheriff sold the property for $31,000.  The judgment was paid off, including interest. The balance from the sale was paid to the registry of the court because the sheriff was unable to locate the obligor.

Finally, the agency filed a motion and was granted a continuing writ of garnishment to pay both an arrearage that had accrued since the judgment and future child support.

Contact Barbara J. Ingram, Director, Child Support Enforcement Division, Manatee County at (813) 749-7160 ext 4356

In New Jersey, liens are automatically placed against any real or personal property and assets of the delinquent obligor to secure child support arrears beginning on  the date the payment is due and unpaid, and thus becoming a judgment by operation of law. The judgments are automatically referred to the Clerk of the Superior Court for docketing.  All liens are filed centrally in the Superior Court Clerk’s Office in Trenton which makes the information accessible for title searchers and real estate attorneys throughout the State.

Once a judgment is identified, the county probation division enforcing the case certifies the final payoff figure (which may include post-judgment interest if requested by the custodial parent (CP) in non-AFDC cases or a county welfare agency in AFDC cases) and processes the payment. Once the judgment has been satisfied, the county probation division requests a warrant of satisfaction certifying that the judgment has been satisfied from either the CP or the county welfare agency.  Any payments received on a judgment are not disbursed until the warrant is signed and filed with the probation division.

If an obligor is unable to pay the full amount of the arrears, the CP has the option of accepting partial payment and releasing the lien on the specific property being sold or refinanced. However, any unpaid amount would remain due and owing and serve as a lien against any additional real property the obligor may own.  If the obligor refuses to the debt, the property sale or refinance transaction is usually terminated because of the NCP’s inability to get title insurance and the unlikelihood of a lending issuing a mortgage on a property that is encumbered by a child support lien.

In the first three quarters of FY 1993, 438 warrants of satisfaction were processed and a total of $873,665 collected through this process with only minimal staff increases. This method provides a way to collect an arrearage in one lump sum instead of waiting years for installment payments.  The accrued interest also restores the value of the money that has been lost over the years. (See “New Jersey Judiciary Automates Child Support Judgments” in the Child Support Report, June 1993.)

Contact Eileen Coughlin at (609) 588-2385.

*In Virginia, an obligor attempted to refinance his home and found a lien filed by the Department of Child Support Enforcement.  He contacted the child support agency, a child support worker ascertained the correct arrearage and arranged for the obligor to come to the district office to pay the debt of almost $8,500, which he did.  He is currently paying his support through wage withholding.

Contact Carolyn Davis, District Manager, Fairfax Office at (703) 934-0025

*   As a condition of a lien release (i.e., for real property sale) in Maryland, an attorney may demand that security be posted for a certain number of monthly child support payments before agreeing to the release.  It may be necessary to first make a formal motion for the posting of a bond/security if the obligor refuses to do this voluntarily (usually, they agree because they are in a hurry to close the new real estate deal).  From the Maryland Prosecutors’ Seminar, May 1993.

Contact Amy Bernstein Robertson, Special Counsel, Prince George’s County at (301) 952-4823

*   In 1991, the New Jersey Child Support Office learned of a pending suit against US Steel in which 2,400 plaintiffs would be awarded from $800 to $1,800 each, based on the corporation’s alleged discrimination against minority applicants.  Child support workers secured a list of the plaintiffs’ names, addresses and social security numbers to match against a list of delinquent obligors.  The federal court judge cited the injustice of  plaintiffs receiving monetary awards while refusing to support their own children.  320 delinquent obligors were found, owing $2.5 million in arrears.  New Jersey collected $1.2 million from 197 of them.

Contact Eileen Coughlin at (609) 588-2385

*   Recent legislation in Kentucky provides that a father’s obligation to support is not necessarily terminated by his death. The amount of support may be modified, revoked, or commuted to a payment, to the extent just and appropriate in the circumstances.

Contact Steve Veno at (502) 564-2285 ext 404

*   In Maryland, a good standard procedure when notified of a possible inheritance is to get as much information about the decedent and estate as possible.  With a name, date of death and location, the local Register of Wills can be contacted to determine if anything has been filed.  Call the probate office or family of the deceased to verify the obligor’s amount of inheritance and the date the estate will be distributed.     Contact the obligor for an assignment.  If the obligor refuses and is not in compliance with the support order, file a Petition to Cite for Contempt and obtain the assignment in court. If the obligor is in compliance, file a Petition to Reduce Arrears to Judgment. (Check your jurisdiction, in many localities payments become money judgments by operation of law as they come due and you can avoid this last step.)  The judgment acts as a lien against the inheritance.

Contact Amy Bernstein Robertson, Special Counsel, Prince George’s County at (301) 952-4823

*   In Florida, an obligor, who had never paid child support for his five children, was the sole beneficiary of a $4 million spendthrift trust administered by Chase Manhattan Bank in New York.  The division learned about the trust and filed a petition for enforcement. As a result, the division obtained a judgment for the arrears of $97,600.  The court ordered $200 per month current support; $1,000 per month on the arrearages, and an order for income deduction. The income deduction order of $1,200 was forwarded to New York with an interstate wage-withholding request.  Pursuant to New York law, an additional 50 percent of the Florida order amount could be garnished.  New York served the order on Chase Manhattan, the trustee, and Manatee County now receives monthly payments of $1,800.

Contact Karl A. Youngs, Program Attorney, Manatee County at (813) 749-7160 ext 4356

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14 Comments
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