A federal court of appeals has held that crime victims may garnish a criminal’s retirement funds in order to enforce certain restitution orders under the Mandatory Victims Restitution Act (MVRA) of 1996 (U.S. v. Novak, 476 F.3d 1041 (CA-9, 2007)). The court ruled that the MVRA overrode the Employee Retirement Income Security Act (ERISA) of 1974—despite the anti-alienation provisions under the latter. The court noted that a recent IRS private letter ruling, as well as several federal district courts’ decisions, came to the same conclusion on the issue. Since the U.S. Supreme Court has broadly interpreted ERISA’s anti-alienation provisions, experts expect the Novak case to eventually be considered by the high court. Please contact a member of Somerset's Litigation & Valuation Team for your litigation support needs.
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