If your employer received a Valley Servicing wage assignment notice, it almost certainly came from a loan you took out with an online lender affiliated with the Oglala Sioux Tribe. It is not a court-ordered garnishment. It is a voluntary payroll authorization that, under federal law, you have the right to cancel in writing at any time.
Who Valley Servicing Is
Valley Servicing describes itself as a “Tribal licensed third-party servicer” that handles voluntary and revocable earnings assignments authorized by borrowers. It operates as a subsidiary of Wakpamni Lake Community Corporation, an arm of the Oglala Sioux Tribe, and says it works under federal and tribal law rather than state law.
In day-to-day practice, Valley Servicing is the collection arm for tribal-affiliated online lenders. When a borrower takes a high-interest loan whose paperwork includes a wage assignment clause, Valley Servicing is the entity that contacts the borrower’s employer and asks payroll to start sending part of each paycheck directly to the lender.
Wage Assignment, Not Wage Garnishment
This difference drives everything else. A wage garnishment is a court-ordered procedure that forces an employer to withhold pay for a debt, with a judge involved and a chance for the worker to raise defenses first. A voluntary wage assignment is a contract term in which the borrower pre-authorizes direct payroll deductions, no court required.
The U.S. Department of Labor draws the line plainly: “Wage garnishments do not include voluntary wage assignments — that is, situations in which employees voluntarily agree that their employers may turn over some specified amount of their earnings to a creditor or creditors.”1U.S. Department of Labor. Fact Sheet 30 – Wage Garnishment Protections of the Consumer Credit Protection Act Tribal lenders rely on exactly this framing to skip the court system. A Valley Servicing notice is not backed by a judge’s order; it is a request that your employer honor the authorization you signed when you took the loan.
The FTC confirmed the point when it settled with payday lenders who used tribal affiliations to pull wages: “debt collectors cannot garnish consumers’ wages without a court order, and they cannot sue consumers in a tribal court that doesn’t have jurisdiction over their cases.”2Federal Trade Commission. Payday Lenders That Used Tribal Affiliation to Illegally Garnish Wages Settle with FTC A tribal court order generally has to be validated by a state or federal court before it can compel action off tribal land. Without that, enforcement depends on whether your employer voluntarily complies and whether your state recognizes the assignment at all. Many states regulate or prohibit wage assignments tied to payday-style lending.
You Can Revoke It — Federal Law Says So
The FTC Credit Practices Rule, at 16 CFR § 444.2(a)(3), makes it an unfair practice for a lender to take a wage assignment from a consumer unless one of three things is true:
- The assignment is revocable at the borrower’s will.
- It is a preauthorized payment plan starting when the loan is made.
- It applies only to wages already earned at the time of signing.
Anything outside those categories is prohibited.3eCFR. 16 CFR Part 444 – Credit Practices Valley Servicing itself describes the assignments it services as “voluntary and revocable.” So even if the loan paperwork tells you the assignment is permanent, that term is unenforceable under federal law. The FTC can sue violators in federal court, with civil penalties of up to roughly $54,540 per violation.4Federal Trade Commission. Complying with the Credit Practices Rule
How to Revoke a Valley Servicing Wage Assignment
The process is simple, but documentation matters.
Write a short revocation letter stating that you revoke all authorization for wage deductions related to the loan. Send it to Valley Servicing by certified mail or another method that creates a delivery record. Send a copy to your employer’s payroll department the same way. Keep proof of mailing and delivery.
Once your employer has a valid revocation in hand, deductions should stop. Continuing to withhold wages after a revocation can expose the employer to liability for unauthorized deductions, which is a strong reason most payroll departments will act on a clearly worded letter.
Before anything is deducted at all, it’s worth confirming what Valley Servicing actually sent. Ask your employer for a copy of the notice. Pull your loan agreement and check whether you signed a wage assignment authorization and what it says about cancellation.
What Revoking Does and Doesn’t Do
Revoking the assignment stops the direct pull from your paycheck. It does not erase the underlying debt. The lender can still try to collect through other channels, including filing a lawsuit, and interest may keep accruing on the balance. What revocation does is force the lender into proper legal channels, where you get notice, a chance to raise defenses, and room to negotiate.
If You’re the Employer
Employers often aren’t sure what to do with these notices. A Valley Servicing wage assignment is not a court order. It is a request to honor a voluntary authorization the employee allegedly signed, and unlike a garnishment order, non-compliance does not carry the same legal consequences under state law.
Before deducting anything, verify that the employee actually signed the authorization, confirm the assignment is revocable, and check your state’s wage-payment laws. Many states restrict or prohibit wage assignments for consumer debts, and honoring an invalid one can create liability for improper deductions. If the employee submits a written revocation, stop deductions immediately. Keep copies of the notice, any authorization, the revocation letter, and the deduction history for at least three years as a practical safeguard.
Extra Protection for Service Members
Active-duty military members, their spouses, and dependents are covered by the Military Lending Act. The MLA makes it unlawful for a creditor to require a service member to set up an allotment to repay consumer credit as a condition of the loan.5FDIC.gov. V-13 Military Lending Act A mandatory wage assignment functions as that kind of requirement. If you’re a covered borrower and the tribal lender required the assignment to get the loan, that term is likely void.
Where to File Complaints
If Valley Servicing contacted your employer after you had already revoked authorization, or if you never signed an assignment in the first place, the conduct may violate the Fair Debt Collection Practices Act, which prohibits deceptive and unfair collection practices.6Federal Trade Commission. Fair Debt Collection Practices Act Text
File complaints with the Consumer Financial Protection Bureau and your state attorney general’s office. Several state attorneys general have gone after tribal lending operations that try to work around state consumer protection laws. If wages were pulled without proper authorization or after you revoked it, talk to a consumer protection attorney. These cases can support claims for statutory damages, and many consumer attorneys take them on contingency.
Save everything: the loan agreement, the wage assignment notice your employer received, your revocation letter with the certified mail receipt, pay stubs showing deductions, and any messages or calls from Valley Servicing. That paper trail is what any dispute or lawsuit will rest on.