Illinois Supreme Court Enters Order Providing Crucial Relief to Low-Income Residents with Frozen Bank Accounts

***PRESS RELEASE***

FOR IMMEDIATE RELEASE
Contact: Caroline Manley, Center for Disability & Elder Law
cmanley@cdelaw.org

Chicago, Ill. April 27, 2020 – On April 24, 2020, the Illinois Supreme Court entered an Emergency Order allowing Illinoisans access to critically needed funds in bank accounts that have been frozen while courts throughout the State are closed due to COVID-19.  Issued in response to a proposal jointly submitted by the Center for Disability & Elder Law (CDEL), other consumer advocates, and creditors’ attorneys, the Emergency Order automatically applies a $4,000 exemption to funds held in a bank account from which a creditor is seeking to collect a judgment entered against a consumer.

“We are grateful that the Illinois Supreme Court addressed the needs of Illinois residents to access their money and their stimulus payments,” said Caroline Manley, Executive Director at CDEL.  “We know that low-income and working class people are disproportionally impacted by COVID-19, and this Order will help them with their most basic needs.” 

After a judgment is entered, the plaintiff can issue a garnishment summons or citation to a bank that freezes all funds in the consumer’s bank account until a hearing can take place at which the consumer is able to assert exemptions and other defenses to the proceeding.  Thousands of Illinoisans have been left in limbo since courts closed, and hearings have been postponed, due to COVID-19.  Bank accounts holding funds needed to pay for food, housing, medicine, and other necessities—including accounts in which CARES Act stimulus payments and tax refunds will be deposited—have been tied up without consumers having any recourse.

Recognizing this crisis, a group of consumer advocates joined forces to draft an initial proposal.  “Every person has a right to a $4,000 wildcard exemption that can be asserted during a hearing,” explained Ashlee Highland, a Supervising Attorney at CARPLS Legal Aid.  “But because many courts do not currently have a process for emergency hearings on bank citations, some consumers would not be able to access their funds for months.” 

The consumer advocates worked together with creditors’ attorneys to refine the original proposal.  Steven F. Pflaum, a partner at Neal, Gerber & Eisenberg LLP, assisted the groups with drafting the proposed Supreme Court Order.  “In times of crisis, it’s wonderful to see groups that are usually adversaries come together to find fair and workable solutions,” Pflaum stated.

The Supreme Court Order, In re: Illinois Courts Response to COVID-19 Emergency/Impact on Post-Judgment Proceedings, M.R. 30370, automatically applies the $4,000 wildcard exemption to all personal bank accounts.  The Order requires a bank to release all funds in accounts holding less than $4,000.  Banks with accounts holding more than $4,000 are ordered to release the wildcard amount while freezing additional funds. 

CDEL encourages consumers with frozen bank accounts holding more than $4,000 to seek an attorney to help them negotiate the release of additional funds.  The Supreme Court Order facilitates such arrangements by specifically instructing financial institutions to accept a letter from creditors in the absence of a court order. 

The duration of the Emergency Order is tied to the Governor’s Executive Order 2020-25, which suspends the service of garnishment summonses and citations while the Gubernatorial Disaster Proclamation remains in effect.

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Center for Disability & Elder Law - In its 36-year history, more than 30,000 people with disabilities and senior citizens have received free legal services from CDEL. CDEL provides the majority of its services in the communities where its clients live, and engages the Chicagoland pro bono community in all of its programming. 

List of Consumer-Advocate Organizations that Requested Issuance of the Supreme Court Order:

CARPLS Legal Aid
Center for Disability & Elder Law
Chicago Jobs Council
Chicago Lawyers’ Committee for Civil Rights
Chicago Legal Aid Society of Metropolitan Family Services
Chicago Urban League
Chicago Volunteer Legal Services
Community Organizing and Family Issues (COFI)/Power-PAC IL
Heartland Alliance for Human Needs & Human Rights
Housing Action Illinois
Illinois Asset Building Group
Illinois Chapter of NACA
Illinois Legal Aid Online
Illinois PIRG
Land of Lincoln Legal Aid
Legal Aid Chicago
Mujeres Latinas en Accion
National Association of Consumer Advocates (NACA)
National Consumer Law Center
Partners in Community Building
Prairie State Legal Services
Shriver Center on Poverty Law
Woodstock Institute
YWCA Metropolitan Chicago