Consumer Law

Debt Collectors Causing Consumers to be Arrested

By Sam Glover

http://www.flickr.com/photos/75905404@N00/2164920292/

This Sunday, the StarTribune reported that hundreds of debtors are locked up every year because they did not pay their debts. Reporter Chris Serres even named names. Here are the top five debt collectors who are jailing Minnesotans for not paying debts.

• Unifund CCR Partners (247)
• Portfolio Recovery Associates (130)
• Debt Equities LLC (92)
• Capitol One Bank (53)
• Lakes Gas Co. (41)

(In parentheses are the number of arrest warrants they obtained from 2005-09.)

Some familiar names are on that list. Portfolio Recovery Associates recently settled a class action for using a dead witness’s name on affidavits. Last year, Debt Equities was ordered to pay nearly $32,000 in a lawsuit in which our client was wrongfully tossed in jail. And Unifund has not had much luck collecting from our clients, either.

As the Strib article points out, debtors are technically going to jail for violating a court order to disclose their assets. But technically, many of the creditors and debt collectors who request those court orders have no right to get them in the first place. But as Washington consumer rights lawyer Michael Kinkley pointed out:

The law enforcement system has unwittingly become a tool of the debt collectors. The debt collectors are abusing the system and intimidating people, and law enforcement is going along with it.

In Jail for Being in Debt & Is jailing debtors the same as debtors jail? | StarTribune (premium subscribers only)

Full post as published by Caveat Emptor on June 07, 2010 (boomark / email).