Are Americans Arrested and Jailed for Owing Money?

I want to be very clear here. The answer is an unequivocal resounding NO!

A couple of months ago, the ACLU came out with a report which asserted,   “….Thousands are arrested and jailed each year because they owe money.”

Oh, please! I am pushing the BS button on this one. “There is not one consumer in this country that was put in jail for the failure to pay a debt. Our court system simply does not work that way.”  You don’t have to take my word for it.  The above statement is a direct quote from the National Creditors Bar Association’s response to the ACLU report.

The ACLU’s assertion that thousands of consumers are arrested and jailed each year because they owe money is displayed prominently in the first paragraph of their 97 page report. Later they actually get to the truth by writing, and I quote, “Laws in states and federal rules of civil and bankruptcy procedure expressly authorize debtors to be arrested and incarcerated for contempt of court.”  Wait, what? It’s not because they owe a debt, but because they were in contempt of court? BIG DIFFERENCE!

In the National Creditors Bar Association’s response, they said, “The ACLU’s report was not only factually inaccurate but was conveniently lacking in relevant truisms in an attempt to sensationalize unfortunate circumstances for individuals who fail to comply with court orders.” Yada, yada, yada…”Members of the NCBA as well as attorneys across this country know that in order for a court to send someone to jail in a civil matter, as opposed to a criminal matter, a complete and utter disregard for a court’s order must have occurred. Judges use this power sparingly otherwise the penalty for contempt would become superfluous.

Litigation is the path of last resort for a creditor.  The process is expensive and time consuming and results in a judgment only and not necessarily the payment of the debt. However, what the ACLU fails to recognize is that the courthouse can be the safest place for consumers if consumers chose to avail themselves of the ability to participate in the system. In court, a judge can supervise the conduct of an attorney and also ensure that the consumer, especially a self-represented consumer, has the required access to the protections the court can provide.”

Do you know what’s funny, ironic even, about the ACLU’s assertion that if you don’t pay your debt you will go to jail? If I said it I would be breaking the law!  That’s right, the Fair Debt Collection Practices Act (FDCPA) that was approved way back in 1977 explicitly prohibits debt collectors from making any threat that the nonpayment of a debt can result in arrest or jail.  Why? Because it is not true!

Each quarter our sister company, United Credit Service, Inc., puts out a newsletter. The 2018 1st quarter newsletter (vol. 6 issue 1) that went out in March was entitled: Fake News or News facts. Can you tell the difference? In it we discussed urban myths and false news stories, and how they pertain to us in the collection industry. As stated in the newsletter, some urban myths and false news stories are told to be entertaining, others are cautionary tales and still others are meant to control a narrative. Which category do you think the ACLU’s report falls into?

I think the NCBA said it best, ”The ACLU’s lack of understanding of the legal debt collection process including its failure to acknowledge federal and state laws which govern debt collection activity, court rules of procedure and the regulations imposed both at the state and federal level result in a report that lacked fundamental credibility, but more importantly hampers the ability of legitimate debt collectors to communicate with consumers to fairly and efficiently resolve their financial obligations.”

A. Alliance Collection Agency, Inc. is a full service, licensed accounts receivable management and debt collection agency providing highly effective, customized one on one management and recovery solutions for our business partners.  Founded in northern Illinois in 2005, we have been proudly improving the bottom-line on behalf of our business partners in and around Chicagoland for over 12 years.

image provided by: CC: Pierre Lecourt

 

Debit Cards: Friend or Foe

I remember when debit cards first came out in the mid-1990s. Our bank mailed my husband and I each a card and we were on our way.

At first we thought it was great. Well, to be clear, it was my husband who thought it was great. You see I was in possession of the checkbook, so I already had access to the money in our checking account whenever I wanted it. But now, with his new debit card in hand, my husband now had immediate access to the funds in our joint-checking just like I did.  Perfect, right?!  Well, not so much.

Let me explain. Whenever I went shopping or wrote a check for cash, I immediately wrote the debit in the register and subtracted it from our balance.  You gotta remember back then there was no internet banking, so there was no way to know exactly what your balance was until your bank statement came in the mail at the end of your cycle—unless, of course, you kept meticulous records by tracking every debit. But here’s the thing, my husband, knowing perfectly well how these things worked saved each and every receipt whenever he used his debit card so he could give them to me to put in the register.  The problem was, he didn’t always hand them over in a timely fashion.  That led to a couple of overdraft charges from our bank and merchants alike—yikes! Don’t you hate double-dipping!  It didn’t take long for us to put a kibosh on the debit card thing.

Fast-forward a couple of decades and we both are back to having debit cards (and yes, I’m still writing my debits in the checking register) but internet banking has given us the ability to keep better tabs on money coming and going. But that’s not always the case for a lot of people.  I read an old New York Times article by Ron Lieber and Andrew Martin called “Overspending on Debit Cards Is a Boon for Banks” that talks about how lucrative debit cards are for banks.

You see banking institutions have their debit cards set up with a nifty feature they market as “overdraft protection”.  In an effort to save you, the consumer, from embarrassment by having a debit card rejected, let’s say, while you’re out on a dinner date, they will pay the debit (oftentimes ‘floating’ you money from your own savings account!) while charging you a fairly steep fee for the convenience.

The NYT article tells a story about a bank customer that was stunned when his bank charged him seven $34.00 fees to cover seven purchases he didn’t have cash in his account to cover. For example, they charged him $34.00 to cover his $4.11 Starbucks purchase, and didn’t notify him of the problem until after they covered these seven expenditures at $34.00 a pop.

The fees generated from the marketed overdraft protection have become an important source of income for the banking industry. In fact, according to that article, banks make more covering overdrafts than they do on penalty fees from credit cards.

“Banks will let you overspend on your debit card in a way that is much, much more expensive than almost any credit card,” said Eric Halperin, director of the Washington office of the Center for Responsible Lending.

There have even been claims of banking institutions manipulating the order in which they pay purchases, running larger purchases first so more fees are incurred.

Federal regulators have acknowledged problems since 2001, they have done little to curb the explosive growth of overdraft fees.

In 2017 alone, Americans paid $34 billion in overdraft fees.

The sad truth is that people need to qualify to get a credit card, but are handed a debit card when they open a checking account.  What we all need to understand is that the convenience of having a debit card comes with responsibility.

Please stay on top of your accounts. You’ve worked hard for your money, don’t let your bank ‘protect’ it with their overdraft fees.

A. Alliance Collection Agency, Inc. is a full service, licensed accounts receivable management and debt collection agency providing highly effective, customized one on one management and recovery solutions for our business partners.  Founded in northern Illinois in 2005, we have been proudly improving the bottom-line on behalf of our business partners in and around Chicagoland for over 14 years.

Image provided by: wikimedia.org

3019 AD

I just read an article “on-line” that excited me!  I’ve thought about this for many years, what with cellular phones becoming smaller and smaller while gaining in power and the ability to control aspects of our lives that wouldn’t have even been considered 5,10 or 20 years past. 

Elon Musk just announced he has successfully created a (micro) “chip” to enable a “brain-computer interface”, and he has had success in having a monkey control a computer with its brain.  Yes, you read this right! 

For many years, I’ve thought as cellphones have gotten smaller, easier to use with voice commands, etc.  why not just take that “chip” inside the phone and implant it behind the ear?  The only reason a cellphone has to be “hand hold-able” is because you can’t take the chip and have a viewable display for the obvious reasons.  But, if you could use voice commands, such as: “Hey Siri” to access an APP, or, “Call Angela”, to communicate with a friend, you wouldn’t need any hand held device, just the ability to use a voice command or possibly a “thought” (brain) command.  I’m no engineer so this would be way, way outside my realm of producing and programming such a “chip” with APPs that could or would replace the current hand held cellphone.

Elon and I can’t be the only two persons thinking down this path…I have to believe that “we” can do this with today’s technology, and this technology is advancing at such a rapid pace that before you know it, deciding on the “size” of your cellular device won’t be a second thought, because it has to fit in your pocket or bag or whatever.  You won’t have to worry that you will forget it on the table in a restaurant, or leave it on the shelf in your closet and 15 minutes later forget where you left it.  How many times have you had to “ping” your phone to locate it?  If it was stored, say, behind your ear under your skin it would never get lost…Also, you’d not have to worry if you fell or jumped into a pool or lake and had your cellphone “on you” that it would be ruined from the moisture.  Heck, even if you didn’t submerse the cellphone, moisture getting into your cellphone can still be a problem for you to deal with.  Implantation under your skin would keep it safe in any situation such as these.  I can’t think of a more “moisture proof” container than your epidermis.

This “neurotechnology” is being advanced by Musk and colleagues at his company called Neuralink.  I’ve never heard of this company, and I suspect this is because of the nature of implanting “brain micro-chips” in people’s brains is not yet considered a “mainstream” idea.  What’s next, will Big Brother start sending you subconscious thoughts?  This most definitely is on the line of “robotic behavior”, in my opinion.  Consider this:  What would you need schooling for if you could simply implant a “chip” that controls your brain?  Could you make the dumbest person in the world “smart” with such a “chip”?  Could you change human behaviors?  For people who “think” they receive subconscious thoughts now, could you actually send subconscious thoughts to counteract what they “think” they are receiving, which could conceivably “fix” their problem?   Could you teach a monkey to be more than just a chimp with a “chip”?  WOW, talk about receiving subconscious thoughts…

My (conscious) thought is, YES it is very possible that anything goes in the realm of tomorrow’s Orwellian world.  What would this mean for collectors and the collection industry?  Could all of our “communications” be “electronic” in nature, and could it be so simple that a “monkey” could send it?  What a concept!  A chimp with a “chip” that could collect the “chips”!  Unfortunately, I won’t be here to see this idea become a reality as I’ve already been around long enough to see what a “computer” can do to change the collection industry.  Artificial Intelligence (AI) has only begun to effect the collection industry, and there are some forward thinkers out there who are looking for ways to make us better and more effective at our jobs as debt collectors using AI (Artificial Intelligence for you non-thinkers).

You can’t become the next “billionaire” by thinking “inside the box”.  The “Elon’s” of our world are thinking and dreaming of other worlds.  Their “outside the box” thoughts and ideas, as crazy as they may seem today, will become a reality in a future world.  Maybe that future world will have colonies (of earthlings) living on another planet or galaxy…WOW again, more subconscious thoughts!  I can’t fathom such ideas based on my reality of watching “Leave it to Beaver”.

So, what IF earthlings lived abroad?  Abroad the vast solar system that is!  Would collectors need to do the same?  What would the “collection agency of 3019” be like?  My guess is it would be nothing like the collection agency of 2019.  How would we collect?  WHAT would we collect?  We’re talking “crypto” currency now, but that hasn’t become mainstream by any means.  My thought is that our “green backs” will not exist and we won’t need wallets to carry ID.  Heck, we may not need ID if we live on MARS!  (There are no BARS on MARS!) Crypto currency may even become a flash in the past before 3019 arrives.  Since the beginning of time, we’ve gone from coins to paper and soon to “cryptos”?  How do you hold “cryptos” in your hand?  Will they fit in my pocket, or wallet…with my “crypto credit cards”? I’m not sure I like where this is going…Until then, I’ll just sit back and dream…dream of the good ole days when debtors with “green backs” actually walked into my office and used those “green backs” to pay a debt.  I’ll dream of placing a telephone call…where I had to “dial” the (rotary) phone number and wait…and I’d speak to a live voice, leave a message with a live person who had to search for a pencil and paper to write down my name and number.  And guess what, every one of them called me back!  WOW again, more subconscious thoughts! 

Today, we still collect in basically the same fashion as we did forever (at least my forever).  Some days I wish for the past and future to become the present.  Doesn’t this sound crazy?  What does the future hold and what has the past already provided us?  I can’t answer this in the here and now, but I can say that the present is just a Nano-second from the future. And, the only certainty in the future is Change, and I’m not talking about those metal coins that used to jangle in your pant pocket.  The past always “feels” better with age, kind of like a fine wine.  We need to remember the past so as to make wise choices in the future, so think about it.  Our present will be optimized when we combine past experience with future expectation.  Now, does that make sense?  (More subconscious thoughts!)

Every human (and I’m only speaking from my personal experience here, so don’t quote me) wants a better future with a fond and memorable past.  We can use this tidbit of information in our collection industry today (the present).  We simply need to treat others as we wish to be treated in return.  This is one concept that has remained the same since the beginning of time. This is what my philosophy is and the one I’ve passed on to my coworkers.

Elon Musk lives in a “fish bowl” with all types of naysayers looking at his every move.  Heck, the guy has built a new car industry (Tesla) and is shooting for the stars (SpaceX).  I wouldn’t expect any less than teaching a monkey to think or even collect debts!  Sounds crazy to me, but it just might work in 3019.

Jim Cox is co-owner of A. Alliance Collection Agency.

A. Alliance Collection Agency, Inc. is a full service, licensed accounts receivable management and debt collection agency providing highly effective, customized one on one management and recovery solutions for our business partners.  Founded innorthern Illinois in 2005, we have been proudly improving the bottom-line on behalf of our business partners in and around Chicagoland for over 14 years.

Image provided by: Wikimedia Commons