Thats exactly what my dad did to my brother. He took his car, his new jacket, his allowance (at the time), his jewelery (he had his ears and eyebrow pierced) and anything of value and told him to smarten up. It worked great until my brother moved out a year later.
But yes, I agree and that's why I think Im basically stuck between a rock and a hard place because her parents see it and know that they should do something....but they just don't do anything. She's their last child living at home out of three and I honestly think they have just given up.