Can I sue a bank or the state for conducting paperless transactions?

[lenrely]

I’d like to know if there is a legal course I can take if a creditor is not providing me with written records or the records are incorrect. Let’s say the NC dept. of revenue is drawing money from my bank account “under the table”, meaning I receive no warning or notice and once it is paid there is no bank record of the transaction. It’s an intimidation technique that is not “officially” a collection. The NCDOR representative told me I had been notified in advance while I was holding their most recent letter dated 2 days ago with “30 days to comply”. It’s an ordinary billing statement. When I asked how would I know from reading this what a “bank garnishment” is, she said my bank was named in the letter as if this was an answer. My bank received a legal indenture which apparently the customer never sees, and charged me a $100 legal fee. I was shown a general purpose agreement which says in one sentence “We charge a $100 legal fee”, but does not tell the customer that bank garnishments exist; strictly speaking it ISN’T a garnishment policy. I was forced to resolve this without knowing what my own rights are, and a bank representative told me there was nothing in my file to show a transaction had taken place. I was sent a copy of the legal indenture they received by mail; it is only the same billing statement addressed to me. I don’t know how the bank knows from reading this what they are instructed to do.
I work at a tax office myself and no one there even knew what “bank garnishment” is called, and I perceive a lot of ignorance and fear. I’m not informed enough to challenge it as one would in any normal dispute. My question is very simple: If I am even considering going to court I have the right to demand a notice that has the date and amount of the transactions on it, and if they cannot provide this or cite a greater policy or exemption that is in writing they are in contempt. Am I right?

 

[xylene]

Ok, without being coy or nebulous, do you in fact owe money to North Carolina?

 

[lenrely]

I guess the fact that I owe them and the amount is just whatever they say it is. For example they want $1000 of unemployment I received from another state in 2009 as if that was mine to give, and I have already paid $1000 in interest. So if the bank knows that I owe them from a simple billing statement, I would ask "How do you actually know than those numbers are correct?".

 

[Zigner]

The bank isn't going to warn you ahead of time about the garnishment...that would defeat the purpose. Contact the folks that you owe the money to and ask them for an accounting..

(No, you can't successfully sue the bank or the state.)

 

[lenrely]

That's not much of an answer so let me rephrase. When someone is holding me to a policy I like to be able to hold them to a policy, and if I'm required to give facts I also like to receive them. I described a good-old-boy system and you gave a good-old-boy non-technical answer. I don’t know what laws or exemptions allow them to get by with this; it's a serious question. I should have said even in a non-successful lawsuit if I am in a situation with enforcers that aren't too bright or paperwork mistakes, you are saying it's impossible that they will "blow it"? If I perceive incompetence common sense tells me I should be taking notes because it might benefit me; I'm not asking them for an accounting for my own peace of mind.
PS- I don't want to start a preferential debate. "That would defeat the purpose" and "you owe them money" is not the perspective of a citizen who wants to be informed so he can pursue his own ends; if we were resigned to spend our lives paying whatever we are told to pay it wouldn't be very realistic. If I couldn't hold banks accountable enough to say "that doesn't look right", what good would they be?

 

[adjusterjack]

Of course, it doesn't "look right" to you. And thank you for not wanting a "preferential debate." We don't want one either.

Unfortunately, you're being told that you won't win a lawsuit against the state or the bank. If you aren't happy with that comment, then you are welcome to hire an attorney and go from there.

 

[Taxing Matters]

The details of exactly what it is that the NCDOR was collecting matters. There are rules for how these things are done but without those details I cannot tell you exactly what process the government agencies involved had to do. One thing that is very common, however, is that when a bank levy or garnishment is going to be done the agency serving the levy or garnishment will not tell you that before it is served on the bank because typically no law requires them to do that. The reason for that is pretty straightforward: if you had advance warning that a levy/garnishment was about to hit your bank account, you'd pull all your money out and the agency would get nothing.

As to your specific question, you asked:

My question is very simple: If I am even considering going to court I have the right to demand a notice that has the date and amount of the transactions on it, and if they cannot provide this or cite a greater policy or exemption that is in writing they are in contempt. Am I right?

No, you are not correct. It is important to understand that the term contempt when used in court refers to contempt of court. As the term itself implies, contempt of court means that a person has violated a court order without good cause, for which the court may sanction the person.

If you sue, you are entitled to seek discovery from the defendant of copies of records in the defendant’s possession that are (1) relevant to the lawsuit, (2) that may be admissible as evidence or may lead to admissible evidence, and (3) that are not otherwise privileged. If you seek discovery from the defendant that you are entitled to get and the defendant refuses to provide it, you file a motion with the court to compel the discovery. If the court grants that motion and the defendant does not comply with the court order then you file a motion with the court for contempt. It is the violation of that court order that gives rise to possible sanctions for contempt of court.

The defendant only has to provide in discovery those records that it actually has in its possession. If the defendant does not have some record that you believe it should have had, the failure to have that record is not contempt of court nor a violation of discovery. One cannot provide what one does not have.

If the law required the defendant to have provided some particular document to you in the course of collecting what the defendant asserted was due and that document was not provided there may be remedies for that provided in the law, but the failure to provide it to you would not be contempt because it was not the violation of a court order. It was a violation of whatever law governed the collection of that debt and that does not give rise to contempt of court.

If a defendant deliberately destroys records after it knows that those records may be evidence in a forthcoming legal proceeding that act of destruction is known as spoliation. Defendants can be sanctioned several different ways for having engaged in spoliation.

When it comes to collection of debts by government agencies, you will have some kind of right of due process to contest the debt. Exactly what that process is depends on the exact debt owed and to whom it is owed. For example, at the federal level the rules are different for recovering a federal income tax liability than for collecting a federal student loan debt. The same sort of differences occur at the state level, too. If the debt originated from another state, then you have to consider the laws of both states.

 

[LdiJ]

That's not much of an answer so let me rephrase. When someone is holding me to a policy I like to be able to hold them to a policy, and if I'm required to give facts I also like to receive them. I described a good-old-boy system and you gave a good-old-boy non-technical answer. I don’t know what laws or exemptions allow them to get by with this; it's a serious question. I should have said even in a non-successful lawsuit if I am in a situation with enforcers that aren't too bright or paperwork mistakes, you are saying it's impossible that they will "blow it"? If I perceive incompetence common sense tells me I should be taking notes because it might benefit me; I'm not asking them for an accounting for my own peace of mind.
PS- I don't want to start a preferential debate. "That would defeat the purpose" and "you owe them money" is not the perspective of a citizen who wants to be informed so he can pursue his own ends; if we were resigned to spend our lives paying whatever we are told to pay it wouldn't be very realistic. If I couldn't hold banks accountable enough to say "that doesn't look right", what good would they be?

Ok, I am going to try. States have a lot of authority (just like the IRS does, but states are generally more ruthless) to collect taxes that are due to them.

If you have not filed tax returns or have not paid taxes due on tax returns that either they have filed on your behalf or you have filed, then yes, they will either levy your bank account or garnish your wages, or both.

If they filed a tax return on your behalf that is not accurate, and that would be something that happens often, then you first step would be to file an accurate tax return for the year in question. If there are any other years for which you have not filed a tax return, it would also be critical to get those years filed as well.

Once all accurate tax returns are filed, your next step would be to get on a payment plan with them. Once those steps are taken they will leave your bank account and your paycheck alone.

If the overall amount of money that you end up owing is beyond your ability to pay, even on an installment plan, then you would probably want a consult with a tax attorney. However, that would not be useful until you have at least prepared accurate returns for any years that you have not filed.

 

[Taxing Matters]

Ok, I am going to try. States have a lot of authority (just like the IRS does, but states are generally more ruthless) to collect taxes that are due to them.

It is not clear to me that this involves a tax obligation. State revenue departments in some states do a lot more than just collect tax; indeed even the IRS collects some debts other than just federal tax (and by collect I mean doing more than just refund offsets), though that is a tiny part of what the IRS does. The OP made a reference to some kind of unemployment obligation, apparently due from some other state. It was not entirely clear to me if that was just an example or whether that is the particular debt that was the subject of the garnishment. In any event, more details on the debt are needed to sort out what process the government had to use to collect what it says was owed. While from its web site it appears the NC Department of Revenue is largely dedicated to collection of state tax, it might, like the IRS, nevertheless do some other things, too.

 

[LdiJ]

It is not clear to me that this involves a tax obligation. State revenue departments in some states do a lot more than just collect tax; indeed even the IRS collects some debts other than just federal tax (and by collect I mean doing more than just refund offsets), though that is a tiny part of what the IRS does. The OP made a reference to some kind of unemployment obligation, apparently due from some other state. It was not entirely clear to me if that was just an example or whether that is the particular debt that was the subject of the garnishment. In any event, more details on the debt are needed to sort out what process the government had to use to collect what it says was owed. While from its web site it appears the NC Department of Revenue is largely dedicated to collection of state tax, it might, like the IRS, nevertheless do some other things, too.

Okay, then the OP will hopefully come back and clarify.

 

[Dandy Don]

Have you figured out who you owe money to--is it a creditor to whom you owe unpaid income taxes, alimony, child support, unpaid student loans, payment for ambulance services?

What you may be dealing with is a bank levy.

Go online and do a search on "North Carolina wage garnishment" or "North Carolina collection laws" and you may find an answer to your question.

There is most likely a way for you to find out who the creditor is who is doing the garnishment to find out details about the debt. Don't blame the bank.