Correcting Financial Problems Consumer Credit Counseling Gives Inmates Lessons In Handling Finances

Patrick Safford and Joseph Shouse have some unique credit challenges.

Safford owes $200,000. Shouse is $18,000 in the hole.

And for another few months the two residents of the Pine Lodge Pre-Release Center will have no way to make good on their legal bills, court costs, and restitution requirements.

But two weeks ago they and a dozen other inmates attended a class on credit and money management led by Cecil Ellsworth, head of education for Consumer Credit Counseling of the Inland Northwest.

The nonprofit agency was invited to the correctional facility last summer by Lincoln Davis, who said he thought money skills would be valuable for a population in trouble partly because they let financial problems trigger criminal behavior.

“A lot of inmates in my experience haven’t had a lot of experience handling finances,” said Davis, former head of community involvement at Pine Lodge.

He has just moved over to Airway Heights, where he and Ellsworth are trying to build inmate interest in a similar class there.

So far, they said, participation has been low.

But at Pine Lodge a credit counseling class has been built into the four-week program inmates must take before they are released.

Among the other components are victim awareness, criminal thinking and anger management.

Ellsworth said the inmates are no different than most Americans in their carelessness with credit. For some, though, he said the irony is that they are serving time because of their ability to manipulate financial instruments like credit cards.

Davis recalled one inmate who approached him with an unusual history.

“`I’ve never paid for anything. Ever,”’ the inmate told him.

The brief class - less than two hours - does not give Ellsworth much time to talk in detail about all the pitfalls of consumer finance and personal budgeting.

After a quick summation of the pluses and minuses of credit, he suggests the class go shopping. The budget: $2,000.

Air Jordans are the first thing in the inmate shopping cart, followed by food, clothes and jewelry.

The tab goes onto a credit card carrying an 18 percent interest rate. The average American, Ellsworth notes, has 11 credit cards in their purse or wallet.

If a cardholder pays just the minimum on the $2,000 balance more than 10 years will pass before the debt is fully repaid, he tells the class.

“If you can get by without credit, get by without credit,” Ellsworth says.

Several in the class protest. Their families want some of the good things, they argue.

“Instant gratification is a really bad idea,” Ellsworth responds. “You do your kids a disservice by buying them too much stuff.”

He said inmates would do well to take as many as three jobs once they are released if that will help them avoid using credit.

When about half the class - including Safford - says they intend to return to school, Ellsworth says that is one investment worth borrowing for.

But he adds that student loans, like other federal obligations, cannot be beat by filing bankruptcy. Nor can court costs and child support.

One inmate asks about credit histories. Ellsworth polls the class and gets a variety of responses on the length of time bad credit remains on an individual’s record.

Answer: seven years, except in case of a bankruptcy, which leaves its fingerprints on your file for 10 years.

Ellsworth says he has arranged with Credit Bureau Services for inmates to obtain a free copy of their credit report.

So far, about 40 have filed the required paperwork.

If an inmate has been incarcerated so long that creditors or others curious about their history have ceased to look into their file, the record may be clean, he says.

Ellsworth also suggests inmates get in touch with creditors to make them aware of their imprisonment. Some will stop adding interest on past-due accounts in such instances, he says.

In another class, students told him a female inmate had $3,000 in interest canceled when her creditors were informed of her whereabouts.

Ellsworth gets a broad groan when he asks if anyone has dealt with collection agencies.

`That’s usually what brings them in to us,” he commiserates. “When you get to that point, life just really sucks.”

He recommends that the students try to negotiate better rates and other terms to ease the fiscal burden.

Safford, for one, knows it will be many years before he eliminates obligations stemming from a history of property crimes.

“Credit cards are the least of my worries,” he says.

But the articulate Safford says he hopes to find a way to finance an education in computer science that will qualify him for a good-paying job.

Safford will be released at the end of the year. Shouse has seven months remaining on a sentence he incurred on an assault.

For him, Shouse says, money was as easily spent as earned.

Both men said the session with Ellsworth was worthwhile.

But information on how diligently former inmates pursue further help with money management is at best anecdotal.

Voncille Molett supervises the Department of Corrections unit in Spokane responsible for collecting money from ex-convicts no longer on any other monitoring program.

She said only a small fraction of the thousands of cases her unit manages have sought ongoing help with their finances.

Their diligence will depend as much on their financial sophistication before imprisonment and support from others afterward as the skills imparted by Consumer Credit Counseling, Molett said.

Others are more optimistic.

At the Reynolds Work Release Center in Seattle, Community Corrections Officer Dwight Hastings estimated that 10 to 20 percent of those who have taken Consumer Credit Counseling courses there apply what they’ve learned.

He said the state includes finances in a 54-element matrix that determines how closely ex-convicts are monitored.

They must keep up with court-ordered restitution during the 10 years they remain under supervision, he said, adding that the typical debt runs between $500 and $3,000.

The director of community services for Pathfinders of Oregon said money management skills may be the tool that keeps ex-convicts from reoffending.

JoAnn Griffin said many are boggled by the financial burdens they confront upon release. And few are in a mood to be frugal after years in prison, she added.

“If they get a few bucks, they just go crazy,” Griffin said.