Debt Collection Practice Review...

[diskmandave]

DEBT COLLECTION PRACTICE REVIEW.

 

The OFT has published guidance notes [OFT298] in January 2000 outlining the Director General’s views regarding misleading letters and collection charges with relation to licensing persay, and under the Consumer Credit Act 1974.

 

The OFT has duly reminded creditors and debt collection agencies that the issue of documents;

Resembling a court summons or other official document.

Leading the debtor to believe they come from or have the authority of a court.

Otherwise containing false or misleading information intended to obtain payment.

 

May be criminal offences under the County Courts Act 1984 and/or the Administration of Justice Act 1970.

 

Any practice liable or intended to mislead the debtor – whether as to the origin or authority of any document or as to any other material matter is likely to be regarded as deceitful or oppressive or otherwise unfair or improper within the meaning of section 25(2)(d) of the Consumer Credit Act 1974, whether the practice is unlawful or not.

 

It is an offence under Section 135/136 of the County Courts Act 1984 to deliver or cause to be delivered to any person any document;

Which, by reason of its form or contents has the false appearance of having been issued under the authority of a county court.

Falsely purporting to be a copy of any summons or other process of a county court, knowing it to be false, or to act or profess to act under any pretence of the process or authority of a county court.

 

It is an offence under Section 40(1)©/(d) of the Administration of Justice Act 1970 to falsely present;

A document as having some official character which it has not with the object of coercing another person to pay money claimed as a debt due under a contract.

An individual to be authorised in some official capacity to claim or enforce payment.

 

It is an offence under Section 40 of the Administration of Justice Act 1970 and Section 1 of the Malicious Communications Act 1988;

To harass of debtors with a view to obtaining payment including the issue of letters which convey a threat or false information with intent to cause distress or anxiety.

 

Documents may be in breach of the County Courts Act and/or the Administration of Justice Act even if they do not exactly resemble a court summons or other official document.

 

Documents may not;

By reason of their form or contents or both, appear to have been issued by or under the authority of a court or other official body.

Mislead as to the nature of the processes involved or the likelihood of legal proceedings.

 

All statements contained in letters and other documents to consumers must be capable of being substantiated in the event of a complaint.

 

Debt Collection Charges

 

There is no legal basis for a creditor or a debt collection agency acting on its behalf to claim collection costs from a debtor unless there is an express provision in the original agreement.

 

Without such provision, collection charges cannot be demanded as a debt due under the agreement.

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If an agency claims the right to recover charges under a separate agreement with the debtor, there must be a binding contact to this effect, with legal consideration (ie benefit) provided to the debtor.

 

A letter advising the debtor of a liability for certain charges is not such an agreement, regardless of whether it is signed by the debtor.

 

If an indication of charges payable on default is not included in a credit agreement regulated under The Consumer Credit (Agreements) Regulations 1983, it is not properly executed and will not be enforceable against the debtor without a court order.

 

It is likely to be an ‘unfair or improper business practice’ under Section 25(2)(d) of the Consumer Credit Act if;

Creditors or collection agencies fail to ensure that they do NOT recover collection charges in the absence of an express contractual provision entitling them to do so;

Debtors are led or allowed to believe that they are legally liable to pay such charges where this is not the case.

Any ambiguity in the debtor-creditor agreement as to whether it covers a particular charge, or the permitted amount of the charge is not resolved in favour of the debtor;

Collection charges provided for in the credit agreement are levied at an unreasonable amount and/or are disproportionate to the main debt.

 

All these issues should be relevant to questions of fitness to hold a licence under the Consumer Credit Act, whether or not they result in prosecution of the individual(s) or company(ies) concerned.

 

Under section 25(2) of the Consumer Credit Act the fitness of a licensee can be brought into question by the actions of any of its employees, agents or associates, and section 25(3) defines ‘associate’ for these purposes as including a business associate.

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This document is © Copyright to David Buckley (diskmandave).

 

This document may be copied freely as long as it is not for profit. No charge may be levied to pass on this document whatsoever. No postage fee may be charged to pass on this document whatsoever.

 

Exclusive licence is granted to Consumer Action Group to freely copy and/or distribute this document on a “not for profit” basis.

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[Boro]

Interesting reading that dave, where would costs for a solicitor and court claim stand under this if a dca files for a ccj against you

[Seahorse]

Unfortunately, if the court found for the DCA, you may rightly be liable for legal and court costs.

 

But the chances of them winning if you actually have the balls to turn up and defend are pretty minimal in a lot of cases.

[diskmandave]

Interesting reading that dave, where would costs for a solicitor and court claim stand under this if a dca files for a ccj against you

Simple.... With the winning party.

 

Which is why Actions should be defended rather than allowed by default.

 

Regards, Dave. “Debt Help Resource UK.” A not for profit self help resource.

[Under Siege]

"Debt Collection Charges

 

There is no legal basis for a creditor or a debt collection agency acting on its behalf to claim collection costs from a debtor unless there is an express provision in the original agreement.

 

Without such provision, collection charges cannot be demanded as a debt due under the agreement."

I'm adding that to my signature

Thats a good find Dave, keep up the good work.

[diskmandave]

Thats a good find Dave, keep up the good work.

That's not a "find" Under Siege!!! It's the Law!!

 

It's also how the Office of Fair Trading sees things as well!!!

 

[Newborn]

Would a creditor who claimed that an 'application form' or an agreement that did not fulfil the relevant requirements made the debt enforceable not fall foul of:

 

It is likely to be an ‘unfair or improper business practice’ under Section 25(2)(d) of the Consumer Credit Act if;

Creditors or collection agencies fail to ensure that they do NOT recover collection charges in the absence of an express contractual provision entitling them to do so;

Debtors are led or allowed to believe that they are legally liable to pay such charges where this is not the case.

 

The OC and DCAs must be the experts in their field so would of course know the minutae of the law and what was enforceable etc. Therefore, to claim that something has the legal weight that it actually does not, should surely be wrong under this guidance.

 

Newborn

[patrickq1]

well done for your post dave brilliant find i have added it to other threads and it is creating quite a stir thanks dave

patrickq1

[diskmandave]

Linked post...!

-------------------------------------------

 

The legalities - Debt Harassment

What legislation is out there that helps me??

 

Section 4A - Public Order Act 1986.

 

Section 40 - Administration of Justice Act 1970.

 

Section 1 & 2 - Malicious Communications Act 1988.

 

The Protection from Harassment Act 1997,

 

(“the Act”) the provisions of this Act are quite complicated so I have detailed the most interesting bits. The Act was introduced to deal with stalking offences, however, Section 1 can be applied to creditors harassing borrowers whereby a person is guilty of this offence if they pursue a course of conduct that they know is harassment of another. The debtor would need to prove that it had happened more than once.

 

 

The Act also allows a borrower to issue civil proceedings, through the Courts and if the claimant is successful then damages may be awarded for any financial loss and anxiety caused by the harassment and hassle.

 

http://www.oft.gov.uk/shared_oft/bus...dit/oft664.pdf

Debt Collection Guideance...

 

__________________

[Curlyben]

Nice post there Dave

[diskmandave]

Why, thank You kind sir...!

[patrickq1]

Section 1 can be applied to creditors harassing borrowers whereby a person is guilty of this offence if they pursue a course of conduct that they know is harassment of another. The debtor would need to prove that it had happened more than once.

this will do for HFO capital limited is it possible to also take this action against MORGAN STANLEY for aiding and abetting in this as they have had several letters asking them to stop HFO from making several phone calls daily

[noomill060]

It would be useful if there was a CAG template Particulars of Claim for a claim under Protection from Harassment Act.

 

I would like to make an attempt at writing one.

[noomill060]

Any assistance in where to start would be appreciated.

[noomill060]

Would you include both the original creditor in the action as well as the DCA they employed?

[diskmandave]

The Public Order Act 1986, Section 5 states:

(1) A person is guilty of an offence if he:

(a) uses threatening, abusive or insulting words or behaviour, or disorderly behaviour, or

(b) displays any writing, sign or other visible representation which is threatening, abusive or insulting, within the hearing or sight of a person likely to be caused harassment, alarm or distress thereby.

 

Section 4A of the act, which carries a higher maximum punishment, states:

(1) A person is guilty of an offence if, with intent to cause a person harassment, alarm or distress, he:

(a) uses threatening, abusive or insulting words or behaviour, or disorderly behaviour, or

(b) displays any writing, sign or other visible representation which is threatening, abusive or insulting thereby causing that or another person harassment, alarm or distress.

...

[noomill060]

Thinking more in terms of a civil remedy.

 

Protection from Harassment Act 1997 (c. 40)

 

1 Prohibition of harassment

 

(1) A person must not pursue a course of conduct—

(a) which amounts to harassment of another, and

(b) which he knows or ought to know amounts to harassment of the other.

(2) For the purposes of this section, the person whose course of conduct is in question ought to know that it amounts to harassment of another if a reasonable person in possession of the same information would think the course of conduct amounted to harassment of the other.

(3) Subsection (1) does not apply to a course of conduct if the person who pursued it shows—

(a) that it was pursued for the purpose of preventing or detecting crime,

(b) that it was pursued under any enactment or rule of law or to comply with any condition or requirement imposed by any person under any enactment, or

© that in the particular circumstances the pursuit of the course of conduct was reasonable.

 

3 Civil remedy

 

(1) An actual or apprehended breach of section 1 may be the subject of a claim in civil proceedings by the person who is or may be the victim of the course of conduct in question.

(2) On such a claim, damages may be awarded for (among other things) any anxiety caused by the harassment and any financial loss resulting from the harassment.

[Sparklez30]

Is there anything in the regulations that allows a DCA to write off an overpayment on an account without informing that an overpayment has occurred, as this has happened to me, I overpaid by £120 which I never knew about until I recently sent a SAR to find out if they put charges on my account which is obviously now paid in full.

 

I can't believe they are allowed to do this! I am of course in the process of requesting back my overpayment!

[Givuzagame]

Anyone heard of Lowell Financial Ltd?

They are harrassing my friend for a paid debt that they've bought from T Mobile. They are sending letters in different names.

Red Debt Collection Services and Hamptons Legal.

The small print at bottom of letters states these companies are a "trading style" of Lowell Financial Ltd.

Would this be considered threatening as recipient would initially look at name on top, presume further action taken.....

Are they in breach here?

[borolad63]

Can anybody help on my very first question on notice of assignment.

 

I have received from Atkiv a notice of assignment between First National and GE Capital Global Consumer Finance (Iknow of First National but not of GE Capital) and Aktiv stating a balance of £677.91 whereas my credit file shows a figure of £678. Does the difference in figures make the notice incorrect and worth challenging.

[diskmandave]

Please start your own thread if you need help on a specific subject.

 

Thanks, Dave.

 

Thread closed to prevent further hijacking.