Friday, September 21, 2012

Left Side of the Aisle #74 - Part 1

Outrage of the Week: DAs and debt collectors

A little while back, a California woman named Angela Yartz wrote a check to Walmart for $47.95.

She later found out the check had bounced. She found out when she got a letter signed by the district attorney of Alameda County, California threatening her with a year in prison if she didn’t pay up plus pay penalties plus pay an additional $180 for a "financial accountability" class; a total of over $280.

Here's the thing: There was no actual charge against Ms. Yartz. There wasn't even an actual legal investigation of Ms. Yartz. The letter didn't even actually come from the DA's office. It came from a collection agency that was allowed to use the DA's official letterhead to send the threatening letter.

This truly offensive practice is now being used in more than 300 prosecutors' offices nationwide. More than 300 prosecutors' offices nationwide are allowing their official stationery to be used by a private corporation to make false threats about non-existent legal investigations in order to intimidate those companies' targets. What makes this worse - if it can be worse - is that the DAs' offices are either paid for this or receive a share of the money collected. How that doesn't amount to at least malfeasance if not an outright kickback scheme, I don't understand.

Debt collection is a $12 billion-a-year business, and 30 million people are now targeted by bill collectors, a number that has gone up as the economy has gone down and for the same reason. Debt collectors frequently turn to strong-arm tactics and threats, often enough illegal ones. Last year, the Federal Trade Commission received just under 181,000 complaints about the debt recovery business.

And now, district attorneys' office around the country are enabling, in fact becoming partners in, bogus threats and crude intimidation including making quite probably illegal demands for payment for these "financial accountability" classes as a cost of settlement.

Hey, what do you know: The state working in cooperation with corporations to go after ordinary individuals facing financial struggles. I guess that's no surprise - but it is still an outrage, the Outage of the Week.


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