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One state AG says debt collectors are abusing laws to detriment of debtors, P 1

The idea of "debtor's prison" was abolished in the United States generations ago. The federal government abolished the concept back in 1833, and Ohio abolished debtor's prisons before the feds. NPR recently ran a disturbing story about a recent trend in the debt collection industry that seems to skirt the ban on debtor's prison.

This blog has previously discussed the practice of collection agencies to file lawsuits in an effort to collect on a debt. Cincinnati bankruptcy and wage garnishment lawyers know that once the creditor receives a judgment they frequently seek an order to collect money from the debtor through wage garnishment. But some bill collectors are using that civil court lawsuit as a means to find another way to attempt to squeeze money from a debtor. And the trend uses jail.

NPR recounts the story of one woman who was pulled over in a Midwestern state for having a loud muffler. The police officer took the woman into custody on a warrant for her arrest. She later learned that a judge issued the warrant after she had allegedly failed to appear for the debt collection lawsuit. The judge set bail on the warrant for $500.

It took her four days, while she sat in jail, to raise the money. Her father worked to amass the bail money to get her out of jail. When he finally gave the money to the court, the cash was turned over to the bill collector and the woman was freed. Similar stories have arisen in other state, including in Ohio's neighbor, Indiana, according to NPR. However, the news outlet does not reference any stories in Ohio.

In the next post, this blog will continue the discussion of the trend in using civil court proceedings to lock up alleged debtors and what one attorney general thinks about the abusive process.

Source: NPR, "Unpaid Bills Land Some Debtors Behind Bars," Susie An from WBEZ, Dec. 12, 2011

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