Indiana County Outsources Check Collections

Writers of bad checks in Vanderburgh County, Ind., will be required to attend a special intervention class on financial management and could face a collection agency, due to a new program unveiled by County Prosecutor Stan Levco.

Levco hired American Corrective Counseling Services (ACCS) in April as a resource for merchants that need to collect on bad checks. Merchants previously used the prosecutor’s office to go after check deadbeats.

Levco says he wanted to shift his office’s resources away from the business of collecting on checks. “The program was essentially run by one person, and we were paying that employee more than we were collecting,” he said. Bottom line, Levco was more interested in “helping merchants get paid, rather than prosecuting” the bad check writers.

San Clemente, California-based ACCS specializes in bad check collection programs for county prosecutors and district attorneys, according to its website.

In 2005, Vanderburgh County received 3,043 bad checks from merchants, resulting in collections revenue of $146,718.13, according to the county’s web site. But Levco says the numbers this year have most certainly gone down – due to fewer checks being placed with his office and a decrease in check-writing in general.

For 16 years, the County Prosecutor’s office was the de facto collection agency for Vanderburgh County merchants. “It was never a primary source of income for us,” Levco said, “but then about two years ago, we saw a dramatic drop in revenue.”  Levco attributes the drop primarily to Wal-Mart’s decision in 2005 to place all of its bad-check collection accounts with private collection agencies rather than dealing with county offices.

Levco’s office retains the power to prosecute bad check writers. Those that are turned over to ACCS are assessed a service fee on top of the bad check amount. In addition to either collections or prosecution, bad check writers will also have to pay $150 to $175 to attend a special intervention class.