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  1. #1

    Default Bank Took Deceased Account Holder's Social Security Money

    My question involves collection proceedings in the State of: FL

    My grandfather opened a commercial credit card 15 years ago with $15000 limit through his and my grandmother's bank. My grandmother signed nothing as it was to be used primarily for his trucking. Fast forward. Grandpa dies June 2017. Bank is notified. Grandmother is ruled terminal in September 2017. She visits with her lawyer, updates will, appoints POA, updates housing deed, and assigns a beneficiary to her bank account. At that point the bank tells her there's a problem as they still have my grandfather as the primary account holder and when he updated his address for the account, they mistakenly neglected to update her address, too. We got all of that worked out, they issued a new debit card in her name, they sent us a form to fill out to remove my grandfather's name from the account, we did and sent it in.

    Grandma died 11/23/17. I sent an email to the bank letting them know I was no longer POA as grandma died on Thanksgiving, but my cousin was now beneficiary. In FL it takes a good 3 weeks before the death certificates are available but I wanted to let them know that no other debits or checks made after 11/23 should be payable. (Caregiver had access to debit card) On 12/3 I checked the account to make sure Social security had not made any deposits to the account and they had. I called them to make sure they knew she died. They did and it was in process.

    Yesterday I checked her account to make sure they took their money back and they had, but the balance was zero. On 12/6, the bank had taken the whole kit and caboodle ($4500) for what my grandfather owed on the credit card. This was my grandmother's social security money and what we will need for funeral expenses. (She had gotten a lump sum ($3700 and change) for when my grandpa passed and then $1732 for herself) She didn't sign anything stating they could take her social security to pay his debt and they did this with no notice. Also, they withdrew the money from a pay on death account that should have legally become the beneficiaries on 11/23. My cousin is the beneficiary. What should I tell him to do?

  2. #2
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    Default Re: Bank Took Deceased Account Holder's Social Security Money

    Why wasnít your grandfathers debt paid when he died?

    is this a credit union or a bank?

  3. #3

    Default Re: Bank Took Deceased Account Holder's Social Security Money

    Quote Quoting jk
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    Why wasnít your grandfathers debt paid when he died?

    is this a credit union or a bank?
    Credit Union

    His debt wasn't paid when he died because he had nothing. He was surviving on social security, same as my grandma. We didn't even have anything available to do an obituary or funeral. (His ashes are still in their office and we were going to do a double funeral when grandma died.) My grandma got a $4000 life insurance but she had to use that to catch up on home bills for utilities, car payment, etc. There was a deposit the beginning of November of $3700 and change from Social security for what they owed my grandma since my grandpa died. Then another one for $255. Then the regular deposit of $1732.

    I'm now finding out they neglected to remove my grandpa's name from my grandma's account after all the paperwork was filed to do so. We know they received it because they added my cousin as beneficiary and that was on the same form. But they're saying since they never received the paperwork, it was still a joint account and they can take it.

  4. #4
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    Default Re: Bank Took Deceased Account Holder's Social Security Money

    Quote Quoting stubbornandproud1
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    Credit Union

    His debt wasn't paid when he died because he had nothing. He was surviving on social security, same as my grandma. We didn't even have anything available to do an obituary or funeral. (His ashes are still in their office and we were going to do a double funeral when grandma died.) My grandma got a $4000 life insurance but she had to use that to catch up on home bills for utilities, car payment, etc. There was a deposit the beginning of November of $3700 and change from Social security for what they owed my grandma since my grandpa died. Then another one for $255. Then the regular deposit of $1732.

    I'm now finding out they neglected to remove my grandpa's name from my grandma's account after all the paperwork was filed to do so. We know they received it because they added my cousin as beneficiary and that was on the same form. But they're saying since they never received the paperwork, it was still a joint account and they can take it.
    Has anyone pointed out to them that the money is Social Security money? That is not supposed to be able to be taken for consumer debt judgments.

  5. #5
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    Default Re: Bank Took Deceased Account Holder's Social Security Money

    His debt wasn't paid when he died because he had nothing
    How did they owe your grandmother anything after your grandfather died if he had nothing?

    Read all the documents concerning a credit union members account and any associated accounts they hold with the credit union. You will find that they have the right to take from any account associated with that member to pay a debt to the credit union owed by that member.

    I suspect they had all rights to not remove your grandfather from the account since his debt to the credit union was still outstanding. Either both accounts were reconciled and closed or neither would be. Was his estate ever probated? Did he own any real estate or personal property?

    What happened to his trucking business?

    Btw; account statements come in the name of both account holders in a joint account. Did nobody notice grandfathers name was still on the statements?

  6. #6
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    Default Re: Bank Took Deceased Account Holder's Social Security Money

    Quote Quoting jk
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    I suspect they had all rights to not remove your grandfather from the account since his debt to the credit union was still outstanding. Either both accounts were reconciled and closed or neither would be. Was his estate ever probated? Did he own any real estate or personal property?
    They should still not be able to seize Social Security money for commercial debt. Unless grandma's passing triggered some special clause that I am unaware of, they should not be able to do that if it is made known to them that its SS benefits.

    And where did you see that it was a credit union? I have not been able to find that.

  7. #7
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    Default Re: Bank Took Deceased Account Holder's Social Security Money

    Quote Quoting llworking
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    They should still not be able to seize Social Security money for commercial debt. Unless grandma's passing triggered some special clause that I am unaware of, they should not be able to do that if it is made known to them that its SS benefits.

    And where did you see that it was a credit union? I have not been able to find that.
    I asked if it was a commercial debt, such as the company borrowed the money and it was not answered. Other than that possibility everything spoken of involved personal accounts so I’m guessing the loan was also a personal loan (supported by the fact grandmother didn’t co-sign on it since it was for MOSTLY the trucking business).

    Post 3 states it is a credit union

  8. #8
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    Default Re: Bank Took Deceased Account Holder's Social Security Money

    Quote Quoting stubbornandproud1
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    I sent an email to the bank letting them know I was no longer POA as grandma died on Thanksgiving, but my cousin was now beneficiary.
    Are you stating that the bank account had a pay on death provision, identifying your cousin as the beneficiary of the account upon the death of the account holder?

    Quote Quoting stubbornandproud1
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    I'm now finding out they neglected to remove my grandpa's name from my grandma's account after all the paperwork was filed to do so.
    Wasn't that apparent from the bank statements subsequently issued for the account?

  9. #9
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    Default Re: Bank Took Deceased Account Holder's Social Security Money

    Social Security money is exempt from judgment.

    I don't think it's exempt from the Right of Set Off present in all bank accounts and credit card accounts.

    I can't say one way or the other if the bank did anything wrong.

    But for anybody to do anything about it, somebody is going to have to open probate for grandmother's estate and be appointed representative of the estate in order to address the issue if the bank stands fast.

  10. #10
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    Default Re: Bank Took Deceased Account Holder's Social Security Money

    Quote Quoting stubbornandproud1
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    There was a deposit the beginning of November of $3700 and change from Social security for what they owed my grandma since my grandpa died. Then another one for $255. Then the regular deposit of $1732.
    Quote Quoting jk
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    How did they owe your grandmother anything after your grandfather died if he had nothing?
    In all probability, grandma was getting 1/2 the grandpa's social security. When the grandpa died, grandma would have then started to collect grandpa's full benefit rather than the 1/2 she had been getting before. That's where the extra money from social security would have come from along with the $255 death benefit.

    From the first post, grandpa died in June, and the money was paid in Nov. That's 4 to 5 months at roughly and extra 1732/2 = $3,464 to $4,330 which isn't too far off from the $3,700 that actually got credited.

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