Peter Schiff: Armed Marshals Arrest Student Loan Debtors; Is the Bubble About to Burst?

Anne Fri, 02/19/2016 - 13:53

Could the student loan bubble be on the verge of popping?

If desperate government actions serve as any indication, it may well be.

Last week, seven US Marshals armed with automatic weapons came to Paul Aker’s home in Houston to arrest him for a $1,500 student loan debt dating back to 1987. According to the Guardian, Acker isn’t alone facing the barrel of a gun over outstanding student loans:

"Aker is unlikely to be the only person to be surprised by marshals collecting on student loans. A source at the marshal’s office told Fox 26 that it is planning to serve warrants on 1,200 to 1,500 people over student loan debts.”

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And I know - it's the government's excuse, err, reason.....

Several news outlets picked up the story, painting a dramatic scene in which “U.S. Marshals armed with automatic weapons” arrested Aker “for not paying a $1,500 student loan from three decades ago.” Another outlet even tried to tie Aker’s case to ongoing student loan protests led by disgruntled students who attended shady for-profit institutions.

This all makes for a compelling headline, but Yahoo Finance has learned the true story is much different.

Back in November 2006, Aker was sued by the federal government for nonpayment of more than $2,600 in unpaid federal student loan debt, according to documents from the U.S. District Court for the Southern District of Texas (embedded below). The court record shows that Aker, listed as Winford P. Aker in the complaint, did not appear in court to answer the lawsuit and, as is common when student loan borrowers fail to appear, the presiding judge ruled against him and ordered Aker to pay the full balance on April 17, 2007.

According to a statement from the U.S. Marshals Service, Aker repeatedly refused to show up in court after being contacted several times. The agency said Aker told them by phone he would not appear in court to answer the summons. Disobeying a court order is a criminal offense. Within a few months, the judge issued a warrant for his arrest, which the U.S. Marshals carried out. So, yes, Aker was arrested, but not just because he owed a little student loan debt. He was arrested for disobeying a court order.

http://finance.yahoo.com/news/paul-aker-us-marshal-student-loan-debt-arr...

I STILL STAND WITH RAND!