Illinois "Debtors Prison" Bill Signed into Law

Illinois Governor Pat Quinn Wednesday signed a bill into law that clarifies best practices for post-judgment collection of debts. The new law largely bans the practice of “body attachment” for debt-related judgments, through which some consumers were being jailed for failing to show up for hearings in debt collection cases.

The new law, which began its life as Illinois HB 5434 or “The Debtors’ Rights Act of 2012,” took immediate effect after the Governor’s signature.

Among the provisions in the law, debt collectors and lenders must provide evidence that unprotected assets may exist to repay a debt prior to sending the debtor to jail after a judgment has been entered compelling payment. Under previous law, a debtor could be held in contempt of an order to pay if they missed a payment.

The bill was initially authored and heavily promoted by state attorney general Lisa Madigan.

“It is outrageous to think in this day and age that creditors are manipulating the courts, even threatening jail time, to extract whatever they could from people who could least afford to pay—veterans, the unemployed, seniors who rely solely on their benefits to get by each month,” Madigan said in a statement after the signing. “This law corrects that gross oversight and puts a stop to throwing people in jail for being poor while still allowing fair debt collection when people have the means to pay their debts.”

The bill moved relatively quickly through the legislative process, with its first reading in the state’s House in mid-February.