Doing Time for Owing Money

Posted July 26, 2010 in Creditor/Debtor by Arthur Buono

Charles Dickens must be turning in his grave. The author of literary classics like "Nicholas Nickleby" wrote about the injustice of debtors’ prisons 150 years ago. The Great Depression passed without them. But now in the 21st century courts often jail persons on debt-related charges.

  • Persons jailed for contempt of court in garnishment and other debt cases
  • Big business of bad debts behind abuse of court system
  • Federal Trade Commission acts on debt collection complaints
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More People Jailed for Unpaid Debts

You can add the threat of prison to what the FTC calls a "broken" debt collection system. There’s a subtle difference but little distinction from the debtor’s prisons of yore. You don’t go to jail just because you owe and can’t pay. You go to jail on contempt charges, for things like missing a court appearance or a court-ordered payment.

The system for proving a debt in court can be manipulated already by the unscrupulous. Observers of the system in Minnesota and elsewhere say the courts can be abused in the same ways to put jail and the bail system to work for unethical debt collectors. They chalk it up to what’s become the big business of buying bad debt.

If you owe money you can’t pay, you have some protections against heavy-handed or illegal attempts to collect it. The Federal Trade Commission says it gets more complaints about debt collection than anything else. The Fair Debt Collection Practices Act prohibits a number of debt-collection practices. It also provides you with a remedy if your rights are violated.

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