Expert Commentary

Criminal restitution: Tens of billions in debt remain unpaid

Offenders owed $110 billion in criminal restitution as of the end of fiscal year 2016, but the vast majority of the debt is "uncollectible," according to a new federal government report.

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Offenders owe $110 billion in criminal restitution to their victims, but the vast majority is “uncollectible,” according to a new federal government report.

The issue: Federal judges are required to order individuals convicted of certain crimes to pay restitution, allowing victims to recoup financial losses resulting from the crime. In some types of cases, judges have discretion in whether or not to mandate compensation. The federal Mandatory Victims Restitution Act of 1996 outlines the types of losses covered and the process for determining the amount of restitution to which a victim may be entitled.

Courts order restitution based on victims’ losses and not on the offender’s economic or employment status. Offenders can set up payment plans based on their ability to pay — their income, assets and living expenses, for example.

A new report examines the types of offenders who are required to pay criminal restitution, how much they owe and how much remains unpaid.

A report worth reading: “Federal Criminal Restitution: Most Debt Is Outstanding and Oversight of Collections Could Be Improved,” from the U.S. Government Accountability Office, released February 2018.

About the report: The U.S. Government Accountability Office (GAO) analyzed sentencing data for offenders sentenced between fiscal years 2014 and 2016. They also looked at the amount of restitution debt collected nationwide over that period.

Key takeaways:

  • Judges ordered 15 percent of federal offenders to pay restitution. Offenses for which courts ordered restitution most often were fraud, embezzlement, arson, auto theft, tax-related crimes, robbery, burglary and larceny. Thirty percent of offenders convicted of murder were ordered to compensate victims.
  • The amount of restitution ordered between 2014 and 2016 totaled $33.9 billion.
  • Between 2014 and 2016, U.S. Attorney’s Offices collected a total of $2.95 billion. Half of that came from debts imposed between fiscal years 1988 and 2014.
  • As of the end of fiscal year 2016, $110 billion in restitution debt was outstanding. The federal government has deemed $100 billion of that to be “uncollectible” based on the offender’s ability to pay. Almost all — 95 percent — of offenders ordered to pay restitution received a waiver allowing them to forgo payment because they had no ability to pay.

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