Debt Collectors and District Attorneys Collude to Deceive Debtors

Picture: Artist unknown (PD)

The New York Times has a story on the ongoing unethical collusion between debt-collectors and prosecuting attorney’s offices:

The letters are sent by the thousands to people across the country who have written bad checks, threatening them with jail if they do not pay up.

They bear the seal and signature of the local district attorney’s office. But there is a catch: the letters are from debt-collection companies, which the prosecutors allow to use their letterhead. In return, the companies try to collect not only the unpaid check, but also high fees from debtors for a class on budgeting and financial responsibility, some of which goes back to the district attorneys’ offices.

So here’s the deal, it’s a crime to write a bad check if you know that the bank isn’t going to honor the instrument. But in most states, in order to be convicted the State has to prove that you knew the check was going to bounce when you wrote it. That’s hard which is as it should be, because the crime here is not owing a debt, it’s fraud. We don’t do debtors prisons anymore, and for good reason. Bankruptcy law is explicitly mandated by the Constitution because it has long been understood that not all debts are equal, and sometimes it’s for the best in our society if we just let people off the hook and give them a clean financial slate to start over.

This, of course, drives the vampires of the collection industry, who make money by buying debts for pennies on the dollar and then brutalizing the people who owe those debts who can’t afford to pay them, and in the meantime making all manner of threats and coercive promises to keep those debtors out of bankruptcy so that the vampires can continue to feed.

This, though, is beyond the pale and is a mindboggling breach of professional ethics. It is also, unfortunately, widespread among prosecutors offices across the country. The bar associations across the country often lament the low opinion most people have of our profession. I suggest that this sort of abuse of government power in service of powerful private interests using the imprimatur of the state in service of pure capital extraction is prima facie evidence that disliking lawyers is a rational bit of self-preservation.

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  • http://buzzcoastin.posterous.com BuzzCoastin

    the court system in the US is are for profit business
    the industry directly employes ~3 million people
    and employes several million more in the cop/prison business, also for profit
    besides making money, their primary role is to insure the rule of the elites
    how come most Americans don’t know this?
    a good edumacation and great TV

     

  • Haystack

    A generation ago Americans produced and exported consumer goods to the rest of the world, now we mostly just collect and trade each other’s debts. 

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