Guest Blog from Tess: Without warning! How government can empty out a bank account and leave you with nothing

I’m a single mother of two boys.  One is living with me. We get help from Ontario Works and live in subsidized housing.  My son who lives with me is in high school full-time. He was born when I was his age and in high school.

I finished high school. I finished two university degrees. I struggle with occasional bouts of depression, chronic fatigue, and pain.

At the beginning of February this year I went to an ATM to make a withdrawal.  Instead of leaving with cash, I left with overwhelming distress.  There was no money for me to take out of my only bank account.  Had I been a victim of technological theft?   Being the beginning of the month, this was especially stressful as I would not receive my child tax credit for another three weeks.  In the meantime, I had to pay for transportation to get my son to and from school, I had feed us, and I needed to meet all the other numerous costs of daily living.

When I checked my account activities to find out what had happened, I was dismayed to find that the National Student Loan Service Centre (NSLSC) had cleared out my account.  I called the NSLSC to find out why they had done this to a social assistance recipient with no notice or authorization.   Didn’t this have to be a mistake?

Upon speaking with an NSLSC representative, I learned that the NSLSC attempted to withdraw an even larger amount of funds.  However, they were unable to do so because I did not have enough money in my account. As a consequence, my bank imposed a $45 NSF (not sufficient funds) charge against me.  On the failure of their first attempt, the NSLSC proceeded to withdraw a smaller amount.  They left me with me with just under $3 in my account.

The NSLSC has never withdrawn money directly from my account before so this event was a great shock to me.   As far as I knew, I had not authorized them to withdraw anything.  In fact, I have no bills whatsoever set up for automatic payment.  So, as far as I knew, I retained complete autonomy and control over the distribution of my funds.  I was wrong.

This incident spawned traumatic feelings of victimization and lack of control, leaving me in a state of terror!  It was as if I had a very personal, yet intangible, invisible bully saying to me in a taunting tone:

“You do not deserve to ever achieve a sense of security.  I have power over you.  Power to drastically alter the quality of your life at any moment.   Without notice.  For any reason.  At my whim, I can go into your personal bank account and take as much money as I want, leaving you totally, utterly, destitute and desperate.”  

Needless to say, the actions of the NSLSC had a drastic impact on me and my son.  However, the NSLSC representative I phoned explained to me that the withdrawal was not random.  Rather, they had the right to take funds out of my bank account because I had submitted my Repayment Assistance application late.

And here is how that subsequent conversation went:

“But you do have my application?”


“So you know I don’t have the money. I need it back!”

“We made no error or mistake so we cannot refund the money we took.”

 “But I have $3 left!!  How are we supposed to live?  How can I feed my son?  Get him to school?  Wash our clothes?  You’ve left me with enough money to get to a food bank, but not enough money to bring the food home!  If you have my application, then you know I’m on social assistance.  How can you do this to someone you know is on assistance, regardless if they’re late?”

 “I’m sorry, we did nothing wrong, so there is nothing for us to correct.  As for your NSF charge, talk to your bank.  Next time, make sure you get your application in on time.  You must do it every six months, like clockwork.  The reason we have not done this in the past is because you have always been on time.”

 “Right, and this time I wasn’t on time because your system locked me out of your website after I put in an incorrect password a couple of times.  So, I called you and you sent me a paper application.  I received it in the crux of the holidays and I have been unwell.  My health has been affecting my ability to work – that is why I am in this situation in the first place!  So while my symptoms are flaring, I lost track of the application for a little while, but a lack of concentration and inability to focus are primary symptoms of my illness!

 You expected me to be well within an unrealistically narrow time frame given my illness.  An illness which you have on record there too!”

“There’s nothing more we can do for you.”

And so I called my Toronto Social Services (TSS) worker and explained what happened and that I had been left with $3.  The conversation with my TSS worker went something like this:

“The Student Loan Centre does do that, but we have nothing to do with them”

 “I understand.  But, might there be any other supports available to my family?  We only have $3.”

 “Well, you’ll be getting your child tax credit.”

 “Yes, in three weeks.  And the bulk of that is already accounted for – to be put towards bills.  In the meantime, we need to eat, Troy (pseudonym) needs to get to school, we need to wash our clothes, and I may be called in for a job interview that I can’t afford to get to.”

 “I can only give you information on food banks.”

I decided to forgo mentioning that I only had enough money to get to a food bank and not enough to bring the food home.  Instead I changed the topic, hoping to solve my problem another way.

“Last month I paid $260 for my son’s college and university applications.  I sent you the receipt.  The cost of that is covered right?”

 “No.  TSS would only cover that expense for the social assistance applicant.  Children’s expenses are to be covered by the child tax credit.”

 “Really?  But my son applied for arts programs.  These programs require him to submit a portfolio of his work to complete the application process.  Submitting the portfolios is another $60 – $80 for each program.  So if he wants to go to university or college in the fall, his child tax credit certainly cannot be used for our living expenses.  Is TSS not invested in Troy’s education so that he will not soon become a social assistance applicant himself?  We need further assistance, if not for the extraordinary circumstance of having my bank account cleared, then at least for Troy’s education! ”

 “I can only give you information on food banks.”

Clearly, these two governmental systems (NSLSC, and TSS) were interacting in my family’s life in ways that were simply not working.  However, rather than pointing blame toward one or the other player, I would like to outline a model of what effective support could have looked like for citizens in my situation.

A Preferred Model

TSS workers communicate with their clients on regular basis.  Unlike representatives of the NSLSC, one worker is assigned to a client to work with them on an ongoing basis.  They already assess much micro-data of their clients’ lives, including detailed transactions made in their bank accounts.  They support clients to access services that are intended to assist clients towards self-sufficiency.

Therefore, TSS workers are in an opportune position to assess the involvement of other systems in clients’ lives, and the needs clients have with respect to navigating these systems, as they already do with respect to the Family Responsibility Office, for example.

When I applied for social assistance, it may have been helpful if I had the option of informing my worker that I had outstanding student loans that I obviously could not pay.  I could have signed just one more, on top of the dozens of forms, consenting that my information be shared by TSS and, in this case, the NSLSC.

Upon doing so, the information that my income source is social assistance could have been shared with NSLSC, allowing time, money, and resources to be saved by automatically extending my Repayment Assistance status, rather than processing additional applications every six months while also informing the banks.  This would not only allow greater efficiency of government resources, but it would allow me to allocate more of my personal resources toward my own development toward self-sufficiency and actualization.  Multiplied by the number of OW and ODSP clients who have outstanding student loans, this could add up to very significant savings for taxpayers.  Additionally, it would mean that children would not go hungry and miss school because of the financial crisis created for their parents.

 Tess: May 19, 2014