A man wrongly identified as owing a debt has received a payout of thousands of pounds from the debt collection agency co

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Dr Mike Thompson was contacted in August 2007 by debt collection firm Aktiv Kapital which was seeking £640 it said he owed to a finance company. Dr Thompson knew the debt did not belong with him and he had never heard of the finance company involved.

When Aktiv Kapital threatened court action to recover the money, Mike told the firm it had got the wrong Mike Thompson and that it should produce evidence of the debt. In January, he believed he had finally convinced the firm he was not the person they were seeking. But then he discovered the firm had placed a default on his credit record. He told BBC Radio 4's Money Box: "I was obviously outraged but at that time I had a very good firm of solicitors acting on my behalf." "I was informed that was the point at which we could take legal action in the High Court."

Mike's solicitor told Aktiv Kapital that unless it paid damages and apologised, there were grounds for him to consider suing for defamation. That was because details of the debt Mike did not owe could now be accessed by any finance company checking his credit record, adversely affecting his reputation. After weeks of negotiations, Aktiv Kapital paid him £6,725 in damages and costs and issued a public apology, published in the London Gazette. It said: "Aktiv Kapital (UK) Limited now accepts that Dr Thompson has neither been indebted to, nor defaulted on any account with Aktiv Kapital (UK) Limited." "Aktiv Kapital (UK) Limited wishes to express its regret to Dr Thompson for this error, and apologises unreservedly to Dr Thompson for any embarrassment and inconvenience which may have been caused to him." Sarah Webb, head of media and defamation at Russell Jones & Walker Solicitors, believes a claimant like Mike would have been in a strong position if the case had gone to court. However, to succeed he would have to overcome significant legal protection known as "qualified privilege" given to the firms involved. Ms Webb told the programme: "The claimant would have to show the company had been reckless in passing on the wrong name, that they'd got the wrong person."

To win, claimants would also have to be prepared to overcome financial hurdles as well. Simon Cook, Dr Thompson's solicitor, says anyone not on a high income might struggle to fund their case. "You can't get legal aid for defamation. Most people can't afford the costs of the proceedings. Even if he'd won, he wouldn't have necessarily received all of his costs,"

That's a good start then, and well done Mike.

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[ScarletPimpernel]

Already being discussed: http://www.consumeractiongroup.co.uk/forum/debt-collection-industry/204296-aktiv-kapital-successfully-sued.html