They Loan You Money. Then They Get A Warrant For Your Arrest.

High-interest loan companies are using Utah’s small claims courts to arrest borrowers and take their bail money. Technically, the warrants are issued for missing court hearings. For many, that’s a distinction without a difference.

News Story (Utah)

Anjali Tsui
December 3, 2019

Tags: Debt Collection

Organizations mentioned/involved: National Consumer Law Center (NCLC)


Limas and Greer say they went to court planning to speak to a judge. After addressing their case with Stauffer, they asked her if they were “good to go.” When she said yes, according to Greer, they took that to mean that they had fulfilled their obligations at the courthouse. Limas and Greer left. They were absent when their case was heard before a judge an hour later.

These hallway negotiations between payday lenders and borrowers are ubiquitous in small claims courts across Utah. They raise red flags, according to consumer advocates. Borrowers are typically unfamiliar with the courts and can’t afford to hire lawyers; collectors deal with dozens of cases every month. Consumers might not understand that they are meeting with a representative from a payday loan company rather than a court-appointed official, said April Kuehnhoff, an attorney at the National Consumer Law Center. They might not understand that they have a right to a hearing before a judge or that government benefits like Social Security and disability are exempt from collection. “The settlement agreement just gets rubber-stamped by the court and people get railroaded through this process,” she said.