Monthly Archives: February 2016

Will I Go To Jail If I Don’t Pay My Debts?

Quite a few stories lately about people going to jail detroitBANKRUPTCYpetitionPREPARERjailed

for not paying debts.

In America?

Can this be true?

Will I Go To Jail If I Don’t Pay My Debts?

Well, no.  Not technically.

And, as a lawyer, well, I must be technical.

Now, if you do not pay a fine or cost imposed as part of a sentence for a criminal case, you were convicted of a crime, yes, you might be jailed in lieu of paying, or for not paying.

But we are talking civil cases, judgements for not paying credit cards, payday loans, even student loans.

Still, the technical answer is no.

HOWEVER, YOU CAN BE JAILED FOR CONTEMPT OF COURT FOR NOT COMPLYING WITH A COURT ORDER.

In Michigan, a creditor with a judgment against you can get a subpoena, a court order for a creditor exam, for you to appear to answer questions about your finances, to bring copies of tax returns, bank statements, et cetera.

If you do NOT appear, the creditor can get a bench warrant, an order for your arrest from the court, for not appearing.

So, technically, the arrest is NOT for not paying.

Of course, if the debt is paid, there is no reason for the creditor exam.

The distinction is lost on the news media, which reports the incarceration as being for not paying a debt, like the guy with the 30 year old student loan debt jailed in the story linked to above.

Now, two sides to every story.

So, federal debt, U. S. Marshalls go to the guy’s house.

Why it took so long, who knows.

They claim he said he had a gun, and threatened to shoot them, so they called for back up, and the story becomes 7 U. S. Marshalls to to arrest a guy for a 1987 student loan for $1,500.

Akers said he was hauled into court without having his rights read to him, held for an hour and eventually forced to sign a payment plan with a debt collection company. His story went viral online, sparking calls for protests over his arrest.

On the other hand:

But the story is a bit more complex. According to the U.S. Marshals Service, agents had made several attempts to serve Aker an order to appear in federal court, dating to 2012.

“Marshals spoke with Aker by phone and requested he appear in court, but Aker refused,” the U.S. Marshals Service said in a statement. “A federal judge then issued a warrant for Aker’s arrest for failing to appear at a December 14, 2012, hearing.”

After years of trying to serve Aker at various addresses, agents caught up with him on Thursday, according to the agency. Marshals claim that two deputies attempted to arrest him, but Aker resisted, retreated to his home and told the deputies he had a gun.

So, guess what?

FOLLOW COURT ORDERS!!!

Still, I am glad the story went viral, to focus on the student loan issue and the lack of appropriate relief for many student loan borrowers.

 

Digiprove sealCopyright secured by Digiprove © 2016 Kurt O'Keefe

Is Bankruptcy Involuntary Servitude?

Is Bankruptcy Involuntary Servitude? Rapper 50 Cents says yes. Which is curious, as he filed his own bankruptcy case. So it was, well, you know, voluntary. An involuntary bankruptcy case can be filed against a person or company. But you better be right, or you can be ordered to pay the costs of the personContinue Reading

Updates on debt collector abuse:        The Federal Trade Commission (FTC) reports nailing four more abusive debt collectors. Let’s go through some of the specifics these bad guys were nailed for: First, what they had in common: In all four, the company pretended to be someone they were not – a court official, law enforcement,Continue Reading