As consumers spend away for the holidays, many people are using their credit cards to buy gifts. That means that come January or shortly thereafter, those bills will become due. If you don't pay at least a portion of what you owe, you may soon get a call from the dreaded debt collector.
Debt collection agencies have employed various tactics through the years, including intimidation and straight-out lies, to get you to fork over what you owe — plus any added fees.
One tactic that has become especially effective — and is generally illegal — is the threat of jail time.
The Federal Trade Commission (FTC), whose job it is to enforce the Fair Debt Collection Practices Act, documents a case in which the National Check Registry, based out of New York, was routinely violating consumers' rights by allegedly using "outrageous" methods to scare people into paying their debts.
Can you really go to jail for not paying a debt?
When it comes to debt collectors, those who threaten to have you arrested and put into jail are themselves running afoul of the law, according to the the Fair Debt Collection Practices Act. There are, however two instances in which debt can land you in the slammer.
The first debt that you can indeed be prosecuted and put behind bars for is failure to pay taxes, better known as tax evasion or, in the words of the IRS, tax fraud. It can take many forms, including not reporting income, claiming expenses for work not actually performed or owed, or simply not paying taxes.
In 2016, the IRS launched nearly 3,400 investigations related to tax fraud, resulting in 2,672 convictions that yielded an average of 41 months behind bars. That's some serious time!
The other unpaid debt that can result in handcuffs, steel bars and "three hots and a cot" is failure to pay child support. The most common method that municipalities use to lock deadbeats up is to prosecute them for "contempt of court," meaning that the deadbeat disobeyed a court order.
Contempt of court related to unpaid child support is some serious stuff, and it could get compounded, depending on the complexities of the case. Other related charges could be levied as well, like desertion or child abandonment — all for not paying the debt.