This would be a feature used for purposes of recovering Loans.

If a loan is due and has not been payed for. It would be a similar system as porter but automated.
A banker triggered system.
A player (Active or not) would receive a warning for overdue loans, and have 7 days to take care of matter or talk to banker for compromise.
If matter isn't taken care of and banker doesn't cancel request Player will be arrested, all ships would be confiscated/or sold.
In the detention camp/Jail the player would have to work manual labor where he would burn incoming turns to generate income.
All income would be sent to banker to pay for said loan.
At any time the banker may "forgive" or give "second chance" to Player.
If player is active he can choose to do extra manual tasks to generate more income.

Well, we dont want to turn a fine game in a concentration camp do we? I think that it's the banker's job to offer money to people that he judges is good to trust. Thats part of his "job". If the player doesnt return the money, then it means the banker did a bad job of trusting that player. Although, i agree for a harder "consequence" on those players, i still don't like the idea of a too harsh one like yours. Soooo -1 for the suggestion, but +1 for the general idea of consequences.

Agree with Georgiy. This consequence is too harsh: I can imagine a banker agreeing on a solution but, out of spite for the person, not taking action and taking their ships (I know bankers are generally veterans and trustworthy but who says with age comes forgiveness?). What would be your idea of an "extra manual task" to generate some gold? Maybe trading like normal but assigning a percentage of income to the bank and every time a certain checkpoint is made, a restriction is taken off?

I guess the idea was that this would be like a last resort, mainly used for people who loan and leave.. For active players it would usually end in agreeing to terms and working it out. But players who leave, would leave you an account you can slowly drain to get your loan back from.

harsh but fair same as becoming pirate

bankers = pirates in the real also.

my dad was a banker. the last time i saw him was driving away on his brand new copper plated ship of the line...

For this issue there will be loan shark tech in academy only couple things left to be arranged.

This sounds like another Hitler in the making. A less evil one though I guess.

To put it blunt.

Side note: Sorry if this offends anyone, but I do speak my mind.

+1 for general concept
-1 for suggested implementation

The general concept is actually a great idea. Repossession should be an applicable means to repay debts, although I think that it should be done in a different manner than listed.