Police And Banks Find New Ways To Steal From Us

The NY Times has a story today about the common practice that municipalities are using to “charge” people they arrest a “fee”, regardless if those charges are dropped or if the defendant is found not guilty. The article specifically focuses on Ramsey County in Minnesota where a young man had the $46 in his pockets “confiscated” when he was arrested. The charges were later dismissed but the county kept a $25 “booking fee” and returned the remaining $21 on a debit card. Simply converting the debit card to cash, however, cost the man an additional $7.25. First, there was a maintenance charge of $1.50 per week which kicks in 36 hours after the card is issued. Then there was a $2.75 charge of using an ATM to withdraw a portion of the balance on the debit card. Finally there was a $1.50 charge to check the balance on the card and an additional $3 charge to transfer that balance to a bank account. So, an arrest that did not result in a subsequent charge cost the man $32.25, with that many going to the county and an unnamed bank. Such is the presumption of innocence these days in this country.

These kind of fees are not unusual in certain areas of the country. In Colorado, some towns get nearly one-third of their revenue from fees like this. Kentucky charges for the costs of incarceration regardless of whether the case is dropped or the defendant is found guilty. And similar methods added to the anger of residents in Ferguson, Missouri that fueled the riots over Michael Brown’s shooting. These booking and incarceration fees are just another extension of the outrageous use of civil forfeiture, which is also abused by police across the country. Needless to say, these fees provide a healthy incentive for police to abuse their arrest powers and the pressure from municipal governments to ensure and increase this flow of revenue is also intense.

The young man in Ramsey County is fighting these charges all the way to the Supreme Court. As his lawyer says, “Revenue-starved local governments are increasingly turning toward fees like Ramsey County’s in order to bridge their budgetary gaps. But the unilateral decision of a single police officer cannot possibly justify summarily confiscating money. Providing a profit motive to make arrests, gives officers an incentive to make improper arrests.” Unfortunately, lower courts have dismissed his claim that these fees did not violate his right to due process, saying that the fees involved were “relatively modest”. As a dissenting judge pointed out, those modest fees add up to half a day’s work under the current minimum wage and are close to what is allocated to feed a person for a full week under the food stamp program. For many Americans, those fees are hardly modest. According to the brief by Ramsey County, “Municipal services come at a cost.” Indeed they do, and the process for paying those costs is called taxation, something that is an anathema to so many these days. And that taxation is done via consent of the governed, not by extorting innocent citizens who have little resources to defend themselves. As Kevin Drum says, “I’ve heard all the arguments about due process and civil vs. criminal and so forth, and not a single word of it strikes me as anything but an obvious sham. And yet courts—all the way to Supreme Court—and judicial agencies—all the way to the Department of Justice—accept them without blinking.” It is simply a license to steal.

But it is not just the police and the municipalities who are stealing here. It is also the bank who has this sweetheart deal with Ramsey County that potentially allows it to collect over $7 for very debit card issued by the county. It would be nice to know the name of this bank and what kind of process the county went through in order to choose that bank as its debit card issuer. I’m sure there was something in it for both sides. These nickel and dime fees have been a staple among banks for decades and the prime example is the fraud at Wells Fargo which the bank was able to keep hidden for nearly a decade because the fraud usually involved smaller amounts of money and targeted poorer people who would be less capable of pursuing the bank.

There is really no difference between what is happening in Ramsey County and the petty extortion by police that is common in authoritarian countries and banana republics. Back in the day, when I was visiting Moscow, I heard stories of police stopping cars at random and essentially extorting money from the drivers to avoid a ticket, or worse, for the driver, regardless of whether there was a traffic violation or not. This is no different. In fact, you could say it’s actually worse. The corruption in Moscow was widespread and the money probably flowed up the chain of command. It was certainly institutionalized. But it was not codified into law. In fact, I’m pretty sure that it was against the law in Russia. In Ramsey County and in America, this kind of theft from innocent people is not only institutionalized but has essentially been codified by the courts. Such is the state of democracy in America these days.