California, Crime, Money, New York Times

Blurring the Line Between DAs and Debt Collectors

Over the weekend, the New York Times ran a blood pressure raising article about hundreds of District Attorneys offices that allow debt collectors to use their stationery to chase down folks who write bad checks.

Why does anyone give a damn about prosecutors who help businesses to bully people into ponying up cash under threat of prosecution, before a lawyer ever looks over the case? Well, for starters, the DAs get a little somethin’-somethin’ from the deal, too….

Jessica Silver-Greenberg’s NYT piece is full of juicy soundbites, and it is worth a full perusal. We’ll provide some highlights:

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.

Seems a little harsh, maybe? Well, you gotta be tough on crime! The article reports these programs return millions of dollars each year to retailers like Safeway, Target, and Wal-Mart from bounced or bad checks. Even though that number has decreased as people have used credit cards more often, it would still be way too much volume for prosecutors to deal with in a more normal way.

Let’s meet one of these diabolical, hardened bad check writers:

The practice, which has spread to more than 300 district attorneys’ offices in recent years, shocked Angela Yartz when she was threatened with conviction over a $47.95 check to Walmart. A single mother in San Mateo, Calif., Ms. Yartz said she learned the check had bounced only when she opened a letter in February, signed by the Alameda County district attorney, informing her that unless she paid $280.05 — including $180 for a “financial accountability” class — she could be jailed for up to one year.

“I was so worried driving my kid to and from school that if I failed to signal, they would cart me off to jail,” Ms. Yartz said.

What? That can’t be right. Where are the CRIMINALS? The Leo DiCaprios or the Matt Damons of bad checks? These guys are going after single moms who goof on less than $50 at Wal-Mart? Help us understand, Ken Ryken, of the Alameda County DA:

Debt collectors have come under fire for illegally menacing people behind on their bills with threats of jail. What makes this approach unusual is that the ultimatum comes with the imprimatur of law enforcement itself — though it is made before any prosecutor has determined a crime has been committed.

Prosecutors say that the partnerships allow them to focus on more serious crimes, and that the letters are sent only to check writers who ignore merchants’ demands for payment. The district attorneys receive a payment from the firms or a small part of the fees collected.

“The companies are returning thousands of dollars to merchants that is not coming at taxpayer expense,” said Ken Ryken, deputy district attorney with Alameda County.

Isn’t that some back-assward logic? Great! The DA doesn’t have to spend any money to allow debt agencies to push around single moms who probably just want to buy diapers and school supplies. The attorneys do get a little kickback from the folks who receive the letters — but THANK GOD taxpayers don’t have to foot any bill.

I do understand and appreciate that prosecutors’ offices are overburdened and under-financed. Prosecutors in Contra Costa County, which is adjacent to Alameda, threatened to go on strike this summer.

But, you know, maybe “renting out” prosecutor stationary is not the best way for prosecutors to solve a budget crunch… or an ethical, effective way to do the job:

Consumer lawyers have challenged the debt collectors in courts across the United States, claiming that they lack the authority to threaten prosecution or to ask for fees for classes when no district attorney has reviewed the facts of the cases. The district attorneys are essentially renting out their stationery, the lawyers say, allowing the companies to give the impression that failure to respond could lead to charges, when it rarely does.

“This is guilty until proven innocent,” said Paul Arons, a consumer lawyer in Friday Harbor, Wash., about two hours north of Seattle.

Some attorneys, like Arons, realize the conflict here. Whereas others, mmm, not so much:

“I view it as quite a win-win,” said Baltimore County State’s Attorney Scott D. Shellenberger. “You aren’t criminalizing someone who shouldn’t have a criminal record, and you are getting the merchant his money back.” On its Web site, CorrectiveSolutions says that its classes result in low rates of recidivism.

It’s win-win for who, Scott? Safeway gets its forty bucks back, wonderful. Meanwhile y’all force people to pay 150 bucks for some goofy financial drivers’ ed class — all the while tricking them into thinking if they don’t pay, they’re going to end up not passing go or collecting $200 — but heading straight to jail. Because I’m sure as soon as Yartz got her letter, she stopped whatever she was doing and yelled, “HASHTAG WINNING!”

Not criminalizing someone who isn’t a criminal is not a “win” — it’s just the way things generally work in a democracy.

The article ends with a great, sassy comment from Ms. Yartz, who deserves the last word:

Ms. Yartz also questioned the need for a class on budgeting and financial accountability: “If I meant to bounce this check like a criminal, why do I need a class on budgeting?”

Preach it!

In Prosecutors, Debt Collectors Find a Partner [New York Times]

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