Its been a while since these were around and its actually quiet shocking, though predictable, that they've began to return.The last known debtors' prison to close was in 1833, the United States abolished federal imprisonment for unpaid debts, and most states outlawed the practice around the same time. Before then, the use of debtors' prisons was widespread; signatories to the Declaration of Independence, James Wilson and Robert Morris were both later incarcerated, as were 2,000 New Yorkers annually by 1816.
Six states (Arkansas, Arizona, Illinois, Indiana, Minnesota, and Washington)
still allow debt collectors to seek arrest warrants for debtors in default if
all other collection methods have failed. Whether a debtor will
actually be prosecuted or not varies from state to state, county to
county, and town to town.Other states like Tennessee and Oklahoma have ruled it unconstitutional and done away with it unless the court finds that the debtor actually possesses the means to pay—except in the case of child support obligations.
Most state constitutions, including Minnesota's, have clauses dating
to the 1850s that expressly prohibit the jailing of people for their
debts. Some people
make the claim that it is unconstitutional in the United States to
incarcerate someone solely for failing to pay a debt. However, there is
little settled law on this matter and plenty of precedent for de facto
debtors' prisons.
More than a third of U.S. states allow borrowers to be jailed for non payment of debts. Judges have signed off on more than 5,000 such warrants since the start of 2010 in nine counties.Because of sloppy, incomplete or even false documentation, many
borrowers facing jail time don’t even know they’re being sued by
creditors.