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MoneyWi$e combats recidivism with education
Consumer Action's Community Outreach and Training Manager Linda Williams provided financial literacy skills training to incarcerated individuals.
A 2013 study from the University of Illinois has found that offering comprehensive financial literacy skills training to individuals re-entering society from incarceration can provide them with new life skills that help reduce repeated jail time. The researchers surveyed 155 incarcerated men in two Midwestern prisons and discovered that inmates viewed programs specific to investing, self-employment, managing a checking account, maintaining a balanced budget and building savings as critical to their success outside of prison.
Consumer Action’s Community Outreach and Training Manager Linda Williams provided this kind of in-depth training to 30 participants in the City of Fontana (California) Re-entry Program. All participants at the January training are re-entering on parole or probation.
The training used the identity theft module from Consumer Action’s popular MoneyWi$e financial education curriculum. Williams engaged participants in an interactive discussion about their financial goals and strategies for achieving success on the outside. Every hand in the room went up when she asked who wanted a job and to become self-sufficient.
“If you get a job on the outside,” asked Williams, “would you want to open a bank account, get an apartment, buy furniture, and a car?” Every hand stayed in the air.
Stressing the importance of good credit, Williams explained how a fraudulent credit history resulting from ID theft could prevent consumers from prospering financially. She noted that a 2011 study by the Federal Reserve Bank of St. Louis identified incarcerated individuals as easy targets for identity thieves because they often have clean credit files.
As a first step Williams advised the men to obtain copies of their consumer reports. In addition to credit reports from Experian, TransUnion and Equifax, she urged them to order “specialty consumer reports” that are sold to employers, insurance companies, banks and landlords. These national databases are a good resource for early detection of possible identity theft. Scanning other national databases such as LexisNexis “person reports,” CLUE insurance loss reports, MIB medical reports and ChexSystems banking history reports also may reveal fraud and misuse of Social Security numbers, said Williams. (See Consumer Action's Specialty Consumer Reports.)
At the end of the training, participants eagerly picked up information on ID theft, ways to obtain copies of their consumer reports and mechanisms for disputing inaccurate credit information. The men shared stories about being victims of ID theft, citing some of the signs Williams mentioned.
Every year upwards of 700,000 inmates are released from federal and state prisons nationwide with the potential to make a fresh start, according to the University of Illinois report. Unfortunately, 70% of these inmates are rearrested and 52% become re-incarcerated. Along with ID theft, other stumbling blocks to success include significant debt from lengthy court trials and no immediate source of income. The Brennan Center for Justice reports that some inmates incurred as much as $2,464 in court fees, a figure that does not include other debt such as fines and court-ordered restitution.
Consumer Action is committed to empowering community-based organizations to use quality financial literacy programs to encourage successful re-entry and prevent recidivism. Since, individuals re-entering society from incarceration are likely to be victims of ID theft, and as a result face impediments to their success, Williams recommends that re-entry trainers start with ID theft and educate trainees on how they can obtain and clear up their financial records before sending them out on job searches, to open a bank accounts, or to find rental housing.
Williams points out that the Federal Reserve Bank of St. Louis recommends that formerly incarcerated individuals monitor their credit reports for two or three years after being released.
A newly revised MoneyWi$e ID theft module and interactive teaching game will be available for download March 15. You will be able to find these materials here.
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