Payday lenders have created a modern debtors' prison for many Americans.

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.

But most of them don't end up in jail. So 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. "And I couldn't use a bail bondsman to get out,” Shaw recalled.
The Bill of Rights in the Missouri constitution declares that “no person shall be imprisoned for debt, except for nonpayment of fines and penalties imposed by law.” Still, people do go to jail over private debt. It's a regular occurrence in metro St. Louis, on both sides of the Mississippi River.

Here's how it happens: A creditor gets a civil judgment against the debtor. Then the creditor's lawyer calls the debtor to an “examination” in civil court, where they are asked about bank accounts and other assets the creditor might seize.

If the debtor doesn't show, the creditor asks the court for a “body attachment.” That's an order to arrest the debtor and hold him or her until a court hearing, or until the debtor posts bond.
The practice draws fire from legal aid attorneys and some politicians. They call it modern-day debtors prison, a way to squeeze money out of people with little legal knowledge.

Debtors are sometimes summoned to court repeatedly, increasing chances that they'll miss a date and be arrested. Critics note that judges often set the debtor's release bond at the amount of the debt and turn the bond money over to the creditor -- essentially turning publicly financed police and court employees into private debt collectors for predatory lenders.

“You wouldn't want to be spending taxpayer money to collect $400 and $500 debts. Don't the county police have something better to do?” asks Rob Swearingen, attorney for Legal Services.

Creditors' lawyers say body attachments are necessary to get debtors to obey the courts. To avoid jail, they simply have to show up when told.

In Illinois, Gov. Pat Quinn's administration and Attorney General Lisa Madigan have joined the chorus of critics. The result was a new law, signed by Quinn last month, restricting body attachments for civil debt.
http://www.stltoday.com/business/local/payday-lenders-use-courts-to-create-modern-debtor-s-prison/article_f56ca6aa-e880-11e1-b154-0019bb30f31a.html