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2012 July - August

Mobile Banking: Can the Unbanked Bank on It?

By Karen K. Harris & Ali Terkel

Unbanked and underbanked Americans pay a high price for not being banked, often relying on income-draining payday loans, refund anticipation checks, and check cashiers to conduct financial business. No bank account also means no savings and no credit—and no asset building. Mobile banking could change all that. One needs only to look to South Africa and Kenya for successful mobile-banking models. Virtual banking in South Africa and telco banking in Kenya have enabled millions of previously unbanked people to set up bank accounts, pay bills, and make purchases, all through their mobile phones. Adaptation of these models could set the unbanked and underbanked on the path to economic mobility and financial stability.

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Finding a Way out of Student Loan Debt

By Deanne Loonin

Higher education can be an effective path out of poverty, but many low-income students find themselves crippled by student loan debt. Advocates representing debtors with federal student loans can explore several options to ease their clients’ debt load: canceling loans (for example, for fraudulent schools, disability, or public service employment), postponing payments, accessing affordable repayment plans, settling loan accounts, and challenging collection actions.

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Identifying Misclassified Workers

Lessons Learned from Maryland's Workplace Fraud Act

By Andrea J. Vaughn

Many low-wage workers are misclassified as independent contractors instead of employees. This seemingly minor detail results in major consequences for workers and governments because thousands of people end up ineligible for essential workplace protections. Advocates and state governments are increasingly aware of this problem and are creating innovative ways to solve it. Examining worker misclassification through the passage and enforcement of Maryland’s Workplace Fraud Act may help advocates recognize workers’ misclassification and seek fairness for all workers.

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Sentenced to a Life of Criminal Debt

A Barrier to Reentry and Climbing Out of Poverty

By Rebecca D. Vallas & Roopal Patel

States are increasingly raising revenue for their court and criminal justice systems through court costs, fines, restitution, bail forfeitures, and jail and public defender fees charged to persons accused or convicted of crimes, regardless of their ability to pay. This criminal debt, also known as “legal financial obligations” or “monetary sanctions,” can total hundreds to tens of thousands of dollars. It hurts an ex-offender’s chances of successful reentry or rehabilitation by hampering access to criminal-record expungement, pardon, public benefits, housing, employment, credit, and a driver’s license. Local advocates around the country are building coalitions with public defender programs and other stakeholders to fight the burden of criminal debt and to raise awareness of the often-hidden damage it can cause.

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U Visa Protections for Immigrant Victims of Workplace Crimes

By Eunice Hyunhye Cho

Although core labor law standards protect undocumented as well as citizen and legal resident workers, undocumented immigrants are especially vulnerable to wage theft and other forms of workplace exploitation. Congress established, as part of the Victims of Trafficking and Violence Prevention Act, the U visa to protect noncitizen victims of certain crimes, including crimes related to the workplace as well as domestic violence and sexual abuse. In 2011 several federal agencies released guidelines governing certification of U visa petitions from undocumented immigrant workers; representation of U visa petitioners falls within Legal Services Corporation guidelines.

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Implementing the Inter-American Commission on Human Rights' Domestic Violence Ruling

By Caroline Bettinger-López, Julie Goldscheid, Sandra S. Park, Elizabeth M. Schneider, Ejim Dike, Lisalyn R. Jacobs, Margaret Drew & Mary Haviland

An Inter-American Commission on Human Rights decision that holds the United States responsible for human rights violations stemming from domestic violence is a new tool in combating gender violence. After Jessica Lenahan’s daughters were abducted and killed by her estranged husband, Lenahan sued in federal court to hold police responsible for failing to enforce her restraining order against her husband, but the U.S. Supreme Court found that the police department had no constitutional duty to enforce the order. Before the Inter-American Commission, Lenahan argued that the United States was obligated to adhere to international standards on protecting victims; the commission agreed. Advocates are devising ways to adopt the decision’s international human rights standards.

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Unlocking "Reasonable Efforts"

Kinship Is Key

By Rose Marie Wentz & Kelly Lynn Beck

When a child enters the child welfare system, state agencies and courts often focus on nonkinship foster care and services as the exclusive pathway to satisfying the reasonable-efforts requirement that appears throughout federal and state child protection law. Extended family usually does not enter the picture. Advocates should push state agencies and courts to move beyond traditional service plans to involve extended family at every stage of a child welfare case. Incorporating a family finding and engagement model into child welfare practice can help families reunite sooner and more safely.

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When Bankruptcy Is Not the Best Option

By Michelle A. Weinberg

Filing for bankruptcy protection is not always the best option for low-income debtor clients. Some do not need bankruptcy because they have no garnishable income or assets to protect. Others with substantial home equity may better protect their homes by defending collection actions or seeking a reverse mortgage. Taking care to avoid debt-management and debt-consolidation scams, clients with garnishable income may be better served by negotiating a payment plan outside bankruptcy court. Clients should explore charity care at hospitals and utility assistance programs. Attorneys should advise all clients of their rights under the Fair Debt Collection Practices Act and should clarify the effect of bankruptcy on employment prospects.

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