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lbnetti9 · Jul 6, 2007, 12:05 PM

I reside in New York state and receive child support from the state's support enforcement unit. Is it true that they actually earn interest somehow on my money? If yes, how can that be legal? It is my money, so any interest earned on it should go to me!!

ScottGem · Jul 6, 2007, 12:27 PM

I don't know if its true, but it certainly possible. It has to do with a banking concept call float. From the time money is received until the time its disbursed, it can be earnng interest. For example, You may write a check on 7/1 and mail it that day. Its not received by the merchant until 7/5 and not presented to your bank until 7/6, so there is a float of 5 days. During that time you continue to earn interest.

This may be what's you've been told is happening. The enforcement unit receives support payments in a batch. They immediately deposit the funds, then have to process who gets paid from that deposit. Between the time they get the funds and the time its deposited in your bank, they earn interest on it. This is not illegal.

s_cianci · Jul 6, 2007, 01:36 PM

Originally Posted by lbnetti9

I reside in New York state and receive child support from the state's support enforcement unit. Is it true that they actually earn interest somehow on my money? If yes, how can that be legal? It is my money, so any interest earned on it should go to me!!!!!

Actually, it's not your money, it's your child's money. You are essentially a trustee in that the funds are disbursed to you but with the presumption that they will go for the child's living expenses. Either way, as Scott explained to you, the agency which collects and distributes child support payments may be earning some interest on the float.

excon · Jul 6, 2007, 01:44 PM

Hello l:

I don't know if they earn interest off your money. But, if they do, so what? They ARE providing a pretty good service for you. If it wasn't for them, you wouldn't be getting a dime.

IF they are collecting interest illegally off the money, what are you going to do about it? You DO know, that if you file a complaint against them, they could LOSE your file...

I just don't know if I would bite the hand that's feeding your child. Look, I HATE government. But those people seem to be doing a pretty good job for you. No?

excon