Stricter measures bring judgment debtors to terms

0 Comment(s)Print E-mail SHINE, November 23, 2018
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There can be many reasons for someone to fall into debt, but sometimes it is just a matter of convenience.

Many borrowers can afford to pay off their debts, but, even after being ordered to cough up by the courts, simply choose not to.

These "judgment debtors" now face much tougher sanctions, and according to Shanghai Higher People's Court yesterday, more than 25,000 of them have chosen to come to terms so far this year.

Forty-six government organizations, including the court, signed an agreement in June last year to exchange information on judgment debtors to restrict their consumption of luxury goods, limit their business activities and make it difficult for them to travel until they pay their dues.

In the first seven months of this year, 430 debtors were prevented from buying real estate, 350 were stopped from buying a new-energy car, and a whopping 6,600 found themselves unable to register as company executives.

"Every day we update the business administration and management bureau, the real estate property registration bureau, the land trading center and other organizations. They keep track of the debtors in their own computer systems," said Sheng Yongqiang, vice director of the court.

In a dispute over loans in Huangpu District in 2016, Zou and Lin were ordered to pay 1.3 million yuan (US$187,582) at an annual interest rate of 18 percent to Xu. But they didn't. In July this year, Zou and Lin tried to sell an apartment in Minhang District and were shocked to find that they couldn't. As if by magic, they suddenly found the cash to pay off their debt, to the delight of Xu.

In Changning District, Song was ordered to return 900,000 yuan with interest to Wu in February this year. Song failed to return the money, so the court contacted the expensive school Song's children attended and told the school to send the kids home. As if by magic, Song's spouse suddenly found the means to start paying Wu.

In two years, Shanghai courts have named and shamed about 240,000 judgment debtors who failed to pay their creditors in due time.

They have stopped over 5,000 of them from leaving the Chinese mainland, detained about 2,400 and thrown 71 into jail.

"The purpose is to use our power to the maximum and bring to terms those debtors who deliberately avoid paying their dues," Sheng said.

Bao Huimin, the official in charge of the execution of judgments at the court, said that in some cases there is no hope that the debtors will be able to return the money to the creditors.

"The court cannot help in cases in which the debtors have no property or have gone bankrupt," Bao said. "We can't solve the problems of creditors who take risks that they cannot afford."

In Shanghai, 25 percent of cases are suspended after a certain period with debtors unable to pay the debt, according to Bao. Nationwide the figure is 40 percent.

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