This technique, described on the walletpop.com blog, has been used to success by a collection attorney here in South Central Kentucky. I haven’t seen it lately, but have within the past year or so.
It is basically an end run around the old maxim that you can not be put in jail for owing debt, other than child support and taxes. Essentially, the debt collector’s attorney obtains a judgment against the debtor, then schedules a deposition on the judgment for asset discovery purposes. Then, when the debtor does not show for the deposition, the debtor’s attorney asks the state court judge to have the debtor held in contempt of court for not appearing and be required to post a cash bond equal to the amount of the debt in order to not be incarcerated.
Any debtor that faces this situation should immediately seek the advice of a competent attorney. Unfortunately, the debtor often does not even know that the deposition has been scheduled.
I am hopeful that most state court judges would see this for what it is, and not incarcerate individuals for this type of contempt.
John Rogers, Kentucky Bankruptcy Attorney