CITIBANK WAGE GARNISHMENT STOPPED
Citibank is one of the largest banks in the country and pursues a heavy
collection policy for their consumer credit card debt division. They often
directly sue clients for debt owed and sometimes will sell the debt to
debt buyers if they do not believe that it is worth pursuing the debtor,
especially if they do not believe that the debtor has any assets or property.
In this case, our client was sued directly by Citibank through Rubin and
Rothman, a debt collection law firm that handles Citibank collection cases
frequently. Our client never received service of the summons and complaint
having moved around quite a bit. Citibank was able to obtain a default
judgment against him for that reason. He only learned of the judgment
when he received a wage garnishment letter from his job telling him that
he had 20 days to resolve the situation before garnishment would begin.
Citibank likely chose to sue our client instead of selling the debt to
a debt buyer because they knew where he worked and thought it would be
easy to garnish his wages. Rubin and Rothman did find his job easily when
attempting to enforce the judgment because our client works for New York
City, an easy target. In New York, Citibank is able to garnish approximately
10% of the gross wages of a consumer. There would also be 9% judgment
interest accruing on the total amount while the garnishment proceeds leading
to a much higher total amount to be repaid. Although it is more difficult
to defend against an original creditor like Citibank in court because
they likely have promissory notes and a history of statements to prove
that the debt is proper, vacating an improper judgment is still necessary
as it reopens the case and keeps the burden on Rubin and Rothman to litigate
the substantive issues. Citibank rarely wants to go through the lengthy
process of litigation due to the cost involved which is why Rubin and
Rothman contacted us in this matter to negotiate a settlement that reduced
our client’s total balance by over 60% and allowed them to pay the
settlement over 12 interest free months.