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A Proffessional Corporation est 1980

Cities hiring private firms to collect upon court judgments

In one particular eastern state, unpaid court fines and fees owed to cities has accumulated to as much as $246 million.  Many municipalities in that state are now turning to collection agencies in hopes of recouping some of that debt.

That particular state has resorted to passing laws that allow private firms to track down individuals that owe such debts.  There have been at least 45 cities that have taken advantage of the law in order to put into place a collection program run by private collection companies.  Part of the problem is that court systems and cities often do not have the legal authority that will allow for them to track down the debts or collect upon judgments.

The circumstances there are probably somewhat different from what cities in California would face when such debts are owed.  Obviously, every state has its own set of rules for the collection of judgments and court fees owed.  But the lesson that can be learned is that hiring attorneys, law firms and other private businesses to collect on debts is often more efficient than if government officials are appointed to accomplish the same thing.

One individual was skeptical concerning the effectiveness of private agencies to take on such tasks.  This person felt that court orders and warrants did not scare the debtors, so she doubted that any private company would be able to motivate individuals to pay back their debts.  

It is certainly true that not every agency knows how to best go about collecting the debts, but those experienced in such matters and dedicated only to specific clients have a much better chance for success.

Source: Sentinel, "Town seek to recoup $246M in local court fees," by Keith Heumiller, June 19, 2013