Fees, Fines, and Debt: How Governments and Companies are Jailing Poor People to Make a Buck

This week’s St. Louis Patch dispatch reported this story:

Wakita Shaw’s troubles started with a $425 payday loan, the kind of high-interest, short-term debt that seldom ends well for the borrower . . .  Shaw was surprised in May of last year to hear that the St. Louis County police were looking for her. She and her mother went to the police station. They arrested her on the spot. They told her the bail was $1,250… People do go to jail over private debt. It’s a regular occurrence in metro St. Louis, on both sides of the Mississippi River.”

Last week, a San Diego paper covered how motorists given speeding tickets for $35, actually end up owing the state $235 (including a criminal conviction fee, state court construction charge, and DNA identification fee).
Similarly, Ricardo Graham was incarcerated in Rhode Island for 40 days because he couldn’t pay court fees. He was jailed and held for a bail of $745 – while the state paid $4,000 to incarcerate him – and lost his job due to his imprisonment.
Across the country, states and local governments are raising and aggressively collecting criminal fees and fines (including court fees, jail stay fees, and even public defender fees). Often, failing to pay these fees lands people in jail. Courts are supposed to hold hearings to determine whether a person has the means to pay before punishing them for nonpayment. Instead, courts are bypassing this key constitutional safeguard and simply jailing those who can’t pay their fees.

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The Return Of Debtor’s Prisons: Thousands Of Americans Jailed For Not Paying Their Bills

Federal imprisonment for unpaid debt has been illegal in the U.S. since 1833. It’s a practice people associate more with the age of Dickens than modern-day America. But as more Americans struggle to pay their bills in the wake of the recession, collection agencies are using harsher methods to get their money, ushering in the return of debtor’s prisons.

NPR reports that it’s becoming increasingly common for people to serve jail time as a result of their debt. Because of “sloppy, incomplete or even false documentation,” many borrowers facing jail time don’t even know they’re being sued by creditors:

Take, for example, what happened to Robin Sanders in Illinois. She was driving home when an officer pulled her over for having a loud muffler. But instead of sending her off with a warning, the officer arrested Sanders, and she was taken right to jail.And I didn’t know what it was about.” Sanders owed $730 on a medical bill. She says she didn’t even know a collection agency had filed a lawsuit against her. [...]

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Jail Time for a $14 Bounced Check? How Private Debt Collectors Cash in Posing as the Government

By Mosi Secret, ProPublica. Posted March 12, 2009.

American Corrective Counseling Services uses threats and coercion to cash in on consumers on behalf of district attorneys.

With the seal of Santa Barbara County’s district attorney on its cover, the envelope caught Jennifer Osborn’s attention immediately. And when she opened it, Osborn read something startling: She was being accused of a crime.

Osborn, the letter alleged, had "violated criminal statutes by issuing a bad check." She faced as much as a year in jail and a $2,500 fine unless she made good, paid an additional $215 in fees and spent a Saturday at a "financial accountability class."

The letter stunned the 20-year-old college sophomore. Osborn was unaware that a $92 check she’d written to her school bookstore had bounced, the result of a mix-up with her mom, she said. "Failure to pay in full and schedule class within TEN DAYS from the date of this Notice may result in your case being forwarded for criminal prosecution," the letter threatened.

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Are Students the New Indentured Servants?

By Jeffrey J. Williams, Dissent Magazine. Posted February 5, 2009.

College student-loan debt has revived the spirit of indenture for a sizable proportion of contemporary Americans.

When we think of the founding of the early colonies, we usually think of the journey to freedom, in particular of the Puritans fleeing religious persecution to settle the Massachusetts Bay Colony. But it was not so for a majority of the first Europeans who emigrated to these shores. "Between one-half and two-thirds of all white immigrants to the British colonies arrived under indenture,” according to the economic historian David W. Galenson, a total of three hundred thousand to four hundred thousand people. Indenture was not an isolated practice but a dominant aspect of labor and life in early America.

Rather than Plymouth, Jamestown was a more typical example of colonial settlement, founded in 1607 as a mercantile venture under the auspices of the Virginia Company, a prototype of "joint-stock” corporations and venture capitalism. The first colonists fared badly because, coming primarily from gentry, they had little practical skill at farming and were ravaged by starvation and disease. In 1620, the Virginia Company shifted to a policy of indentured servitude to draw labor fit to work the tobacco colonies. Indenture had been a common practice in England, but its terms were relatively short, typically a year, and closely regulated by law. The innovation of the Virginia Company was to extend the practice of indenture to America, but at a much higher obligation, of four to seven years, because of the added cost of transit, and also because of the added cost of the brokerage system that arose around it. In England, contracts of indenture were directly between the landowner and servant, whereas now merchants or brokers in England’s ports signed prospective workers, then sold the contracts to shippers or to colonial landowners upon the servants’ arrival in America, who in turn could re-sell the contracts.

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