Last week, the Permanent Fund Dividend Division passed out payments to Alaskans totaling hundreds of millions of dollars.
This week, they’re reaching into some of their bank accounts and taking parts of it back.
Division Director Debbie Bitney said they overpaid about 5,500 dividend recipients who should have had some or all of their dividends taken for unpaid bills.
“We are working with the banks to make sure the process is as seamless as possible,” she said.
The payments made in error were less than 1 percent of the total dividends paid, and only a small portion of the total garnisheed payments as well, Bitney said.
At AlaskaUSA Federal Credit Union, which had some of the 3,600 improper direct deposits, they’re trying to recover the money, said spokesman Dan McCue.
“The state has come back on 1,300 accounts for us and have reversed that deposit,” he said.
They’re treating it as an error in a deposit, a not entirely unheard of occurrence, he said.
The issue becomes more complicated when recipients quickly withdraw the money, or check their balance online and may overdraw their account when they wind up having less in it than they thought.
“Those are the ones that we have to deal with on a case-by-case basis, there’s no set answer,” he said.
McCue said AlaskaUSA is trying to help the state recover the improperly paid money, but also doesn’t want an account holder to pay for something they couldn’t have expected. It is willing to waive overdraft fees, he said.
Bitney said the division discovered the errors Monday and announced it to the public Thursday; McCue said AlaskaUSA was notified of the problem Wednesday afternoon by the division.
The solution may be more complicated for 1,900 paper checks that were mailed out. The Dividend Division has placed stop-payment orders on the checks, and had provided banks with lists of all the numbers of the improperly paid checks to help them stop payment.
“It’s all or nothing,” she said, as it is not possible to place a partial stop-payment order on a check.
A list of check numbers will be placed on the division’s website so applicants can check as well, she said.
“We will be figuring out what amount, if any, will be owed to the applicants,” she said, and then cutting new checks.
In some cases entire dividends are seized, in other cases only portions were, she said.
Total amount of the overpayments is not known. The maximum amount of the overpayment, if all 5,500 applicants had their full $1,174 dividend taken, would be about $7 million, Bitney said.
There is no estimate yet of what, if anything the division’s error will cost the state.
• Contact reporter Pat Forgey at 523-2250 or at patrick.forgey@juneauempire.com.
Comments (40)
Add commentok people
check your bank accounts.. the news is saying checks were taken back out last night.. some may wake to MINUS funds in their accounts.... hurry and get something in, or you will be charged fees and fines graciously from the State Of Alaska...
Theft?
This is a perfect case for a class action.I can't believe the state can take money out of someone's account without a court order!!
Not theft, a mistake
If the state had accidentally made a typo in the deposit and given you $11,740 instead of $1,174, would you think you rightfully had that money coming?
If your PFD was being garnished for fines or child support or whatever, you already knew you were being garnished, so you had no right to expect the full dividend. No difference.
Don't like it? Pay your bills. Be a responsible citizen. Stop blaming the state for not getting all the free money you think you're entitled to.
No explanation
The article doesnt state why these recipients were not entitled to the whole amount. Although i can guess the reasons, it should have been stated in the article
So what do you expect from
So what do you expect from the failed banker who runs Perm Fund
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agree with Latitude58.....
on this one. It is certainly a very difficult and demanding process, getting the PFDs approved and out. Keeping up with all the garnishments. Trying to find and weed out the cheats. Snagger, when you are perfect 100% of the time, you can gripe. I won't hold my breath.
PFDs can be garnished for all kinds of things - child support, city fines (i.e. you leave a junked car somewhere...the city can collect on the ticket for that) incarceration, and small claims court. I took an uninsured motorist who caused an accident with me to small claims and garnished her PFD - took me 5 years to get it because there were so many other people in line. But I finally did.
Well said Latitude58.
I agree. These people with garnishments know they have them and know they aren't entitled to some or all of their PFDs. Pay your dues and you'll get your PFD.
PFD Mistake
The problem is people didn't know about some of the garnishments, only what was listed on the PFD website or what was sent in a letter. Apparently, not all garnishments were listed on either place, for some people. So people didn't know about the garnishments and spent the money they thought was theirs.
Go on take the money and run
Yeah yeah yeah
@ snagger
The state of Alaska doesn't need a court order- state statute gives them the authority to Levy a bank account.
Notification of Garnishment
Trister: Your comment about not knowing does not make sense. If you have payments garnished, there is a legal process that occurs that makes you fully aware of what is going on and why. It is like saying, "I didn't know my license was suspended!" Sure you did. DMV sent you a registered letter after the cop took it from you. The creditor and the courts notify you that funds will be garnished so there are no surprises.
Bean is correct. And AK Mom
Bean is correct. And AK Mom is also correct; just because someone owes money doesn't mean they're not responsible; as in her case, some events are costly beyond our control and means to pay them.
What do you expect....
"So what do you expect from the failed banker who runs Perm Fund"
What comment do you expect from someone who clearly doesn't understand that the Permanent Fund Corporation and the Permanent Fund Dividend Divison of the Department of Revenue are NOT the same entity?
PFD office makes a BIG mistake
So my daughter is one of the 5500 people effected by the take back, so we called Mr. Egan office they were kind enough to get some answers to us right away, since PFD was not very forth coming with their information to my daughter this morning...so long story short there was a big mistake in what is going on with the take back....they are hoping to get it fixed by next week or at least have an answer for people next week. the garnishment my daughter had for her student loan was the correct amount but the PFD office still took back the remaining amount that was given too her....wow there must be someone new working in the PFD Office i hope they answer for this BIG mistake
AKGasman shows his ignorance
AKGasman said, "So what do you expect from the failed banker who runs Perm Fund"
MikeyToo and myself are calling AKGasman out for his ignorance. The PFD division and the APFC (Alaska Permanent Fund Corporation) are two separate entities!
I don't know what your personal vendetta against Mike Burns is, but he had absolutely nothing to do with these erroneous payments. Your anger against one man has drawn out your ignorance. If you're going to bad mouth someone about their job, you should at least know what their job is!
If you're going to troll, at least comment on an article that is on topic with your gripe.
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Rules of returning direct deposit payments
Hey folks, I work with direct deposit - listen up and you can learn the banking rules.
When an organization that participates in direct deposit makes that payment, they have five banking days to request a return of the ORIGINAL amount deposited due to an error. By my count, they made the request within that five days, and do not have the ability to ask for only a portion of the deposit. It is all or nothing.
If a bank on the other end see the account doesn't have the funds, they typically reject the request. However, the decision to overdraft the account is up to the bank.
"free money"
@AK_Mom
I don't know why it’s so shocking to anyone. If you owe money and it hasn't been paid for whatever the reason may be. And legal proceedings have taken place to garnish the money, well as much as it sucks that’s just the way it is. If they are taking the "free money" as you put it to pay down the debt you owe maybe you should be thankful. Now if the dividend was say $1000. and you owed $500. and they kept the whole thing and said oh well, then I see a problem. If anyone should be upset maybe it’s the PFD guys that have to go through the hassle of figuring out who's PFD and how much they have to keep to pay peoples bills with.
Those affected didn't pay their bills?
Am I understanding this correctly that the only people affected did not pay their bills and therefore they had their "garnished" debt (or the whole amount) taken out after the PFD erroneously deposited the whole amount?
Well, excuse me, but how embarrassing!
Who waits for the government to garnish wages/money anyway?
That means a collection agency is involved, right?
I'm glad I pay my bills on time and don't cause others to chase me down. I don't feel much sympathy if I am understanding this correctly...
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@fisherwoman and AK_Mom
What I'm hearing is it is true that some of the people who had their direct deposits taken back will not end up getting the entire dividend garnished, and will have what is left over returned. However, I know it is impossible for PFD to take only portions back even if they wanted to. I'm surprised though that banks would allow overdrafts in this situation, as that is typically not how that would go down.
Wow
@ AK_Mom
Sorry I don't take pills for whatever ails me or any other drug for that matter.
Trust me I am not worked up in the least bit. And I don’t believe I used the word complaining a single time in my previous post?
AK Mom...
.....during my court experience with the uninsured motorist, I was told that city, state or federal entities could garnish 100% of the PFD, but private people and companies (i.e. small claims court stuff) could only take 80% of someone's PFD. That didn't make any sense to me - if they owe me and I've proven that in court - I should get all of those funds.
But anyway - I get where you are coming from. if your creditor is a private outfit, it should only be 80%. You might give it a few days and call PFD next week to sort it out. Good Luck.
Not everyone had advance warning
I for one was one of the unlucky people to have the money removed from my account. If I owe someone money then I cannot complain. But not having anything in advance stating this would happen is my complaint. If I knew they were taking my money and who the money was going to then I would have not spent the money. Not telling someone the money will be taken and not knowing who I owe money to is a problem. Not everyone that owes money is just irresponsible. The ones that say that must not have any bills, hardships or bad luck. I do not know who I owe money too. No calls, nothing in mail prior to yesterday finding out they took my money! Not all of us are trying to cheat the system Latitude58!!!!
...
It is truly boggling how self righteous some of you people are. It must be wonderful to be such perfect specimens of humanity. Pray that you don't end up in AK mom's shoes. Pray that you don't end up with a pile of medical bills and have to juggle those with everything else. As some one ssid, "let he who is without sin cast the first stone." The rest of you? I am with mom... Not worth it.
Deal with it
If money is deposited into your account it doesn't mean its yours. If a big windfall appears and you haven't won the lottery, there was a mistake which can be recovered. Don't run off to Vegas, you will have to give it back. If a PFD is garnished, I assume its for just cause and the receiver should be prepared to "buck up".
forensic investigation
Considering how many said they did not know their PFD had been attached, the ACLU or Alaska Legal Services should do forensic investigation and should legislative legal services.
There is also another reason for the State Troopers to investage on another matter. What may have just happened maybe the accidental result of cooking the books trying to conduct a cover up.
About advanced warning
Looks like PFD garnishes dividends off of court orders. If a court order was made, the person the order is against was made aware of it. Or, a reasonable attempt was made to reach them. Hard to say that these individuals didn't have advanced warning.
over drafts
I know of 4 people this morning who were effected by the PFD being taken back. They now have in some case 200.00 in overdraft fees at 75.00 a pop. They didnt touch the PFD, but use their other money to the dime, and when it was taken back, it caused a ripple effect to their accounts. The local news also showed people in Anchorage who are now in the same boat, with massive draft fees.. I know its not right for the PFD to cause Alaskan undue hardship now, ontop of owing other bills from the garnishments. Thus meaning now there will be some very hungry families and children in Alaska for a long time until their are caught up.