Marshals Want Powers to Foil Pesky Debtors

A Vologda debtor was determined to defend his property from court marshals -- or at least make their visit as unpleasant as possible.

In a scene reminiscent of the "Home Alone" movie, he destroyed a footbridge across a drainage ditch in front of his house, spilled foul water from the toilet into his yard, and blocked entrances to the rooms with trash.

People ordered by courts to pay off their debts are growing more ingenuous in their attempts to prevent marshals from confiscating their property in lieu of payment, the Federal Court Marshals Service said. Some hide their valuables or pretend to be dead. One debtor sickened with tuberculosis threatened to infect the marshal by spitting on him.

Marshals carried off the Vologda debtor's valuables despite his efforts to stop them. But as the global financial crisis rolls into Russia, marshals might face bigger challenges than trash and toilet water.

"New methods of evading debt payment are appearing," said Artur Parfyonchikov, deputy head of the Federal Court Marshals Service.

In response, his agency is seeking expanded powers that would allow marshals to conduct investigative searches for debtors, confiscate driving licenses and imprison for a year people late on alimony payments.

Currently, marshals' main weapon is their authority to put debtors on a blacklist preventing them from leaving the country. The rule applies to both Russian and foreign debtors. The proposed changes would also apply to Russians and foreigners.

Parfyonchikov said the new powers were needed to collect 80 percent of all court-ordered payments, as stipulated in a 2007-11 federal program to develop the court system. In the first half of this year, marshals enforced 63 percent of court decisions, including debt collection, compared to 49 percent for all of last year, he said.

"The remaining 37 percent includes very important court decisions," Parfyonchikov said. "To enforce them, we need new powers."

Legislation on confiscating driving licenses and imprisoning alimony debtors were introduced into the previous State Duma but have yet to be scheduled for a first reading, Parfyonchikov said. A proposal to grant the court marshals the right to conduct investigative activities to search for debtors will be drafted by the Justice Ministry within weeks, he said.

The proposed changes look like a government attempt to boost revenues, said Alexei Mukhin, an analyst with the Center for Political Information. "The debt of the citizens [to the state] has reached a critical mass," Mukhin said. "An economic crisis is looming."

But Yevgeny Bushmin, head of the Federation Council's Budget Committee, dismissed the suggestion, saying the amount of money that marshals collect for the state is relatively small.

He and the marshals service could not provide precise figures, but the service said that in the first six months of this year, marshals forwarded to the federal budget more than 29.2 billion rubles in back taxes, which is a portion of the debt that it collects for the state.

In contrast, Bushmin noted, federal budget revenues total 10 trillion rubles ($383 billion) and expenditures total 9 trillion rubles.

A spokeswoman for the court marshals, Lyubov Zhokina, denied that the desire to collect more debts was because of any debt crisis. "This task is given to us at the start of every year, and it's not connected to the economic situation in the country," Zhokina said.

Zhokina conceded, however, that the number of court orders to collect outstanding loans has grown recently. She could not provide statistics, though, saying her agency did not keep any.

Overdue rule debts by Russian companies and individuals to banks amounted to more than 92 billion rubles ($3.5 billion), including over 4 billion rubles ($155 million) in mortgages, as of July, according to Central Bank figures posted on its web site. Foreign currency debts equaled more than 12 billion rubles, including 91 million rubles in mortgages, it said.

The idea of expanded powers for marshals is raising some concerns of abuse.

Lev Ponomaryov, a prominent human rights activist, warned that the initiative was "in stark contrast to Russian laws" and would "create a revolutionary situation in the country."

Writer and opposition leader Eduard Limonov, whose property was recently seized by marshals to secure a court-ordered payment, called the marshals "scoundrels" when asked to comment on the initiative. "These are powers that the Gestapo had," Limonov said.

Parfyonchikov, the deputy head of the marshals service, insisted that the extra powers would not breed corruption. "Corruption cases occur when a court marshal has to deal with money or bank accounts," he said.

Mukhin, the analyst, said the planned changes would bring Russian law in line with those in many European countries. "Most court marshals in Europe already have similar powers, and this doesn't surprise anyone," Mukhin said.

As marshals grow more skilled in their search for hiding debtors, Russians grow more skilled in hiding themselves -- and their assets.

A court recently ordered a Moscow resident to pay a large sum of money. He didn't have the money, so marshals visited his apartment to look for property to confiscate. They found nothing worthy.

"I knew that they would come, so we moved valuable pre-revolutionary furniture, a computer and the TV set to our neighbors," said the man's daughter Olga, 30. The marshals had to settle for deducting small sums from the man's monthly salary for a long period, she said, speaking on condition of anonymity.

The marshals service said the trick of pretending to be poor was an old one. Another popular tactic is to pretend to be dead. For example, a resident of the city of Novokuznetsk in the Kemerovo region owed 80,000 rubles ($3,000) in alimony to his son. To avoid payment, the man sent a telegram to his former wife in the name of his mother, saying he had died suddenly of a heart attack.

The suspicious ex-wife made a few calls and found out that he was in robust health. She complained to the police and the court marshals.

The most sophisticated tricks wouldn't save debtors, Zhokina said. "Even if a tuberculosis patient threatens to infect a court marshal with one spit, the court marshal will return with doctors and the police," she said, citing a real case.

Obstruction of justice can lead to a criminal case, she said.

In the first six months of the year, police put 49,495 people on a wanted list for debts amounting to 13.7 million rubles, her agency said. In addition, more than 35,000 people were banned from traveling abroad over the same period, compared to more than 22,000 in all of 2007.

Zhokina said the debtors included both Russian and foreign nationals, but her agency does not keep records on foreign debtors.