OFT launches revised debt collection guidance

[dadofholly]

Good Stuff, needed revising, just need Creditors, DCA's to take note.

 

I bet we will see a flock of these first :flypig:

[dadofholly]

Are you saying that this isn't a seminole moment?

 

Rebel get your coat - i'll call the taxi

[dadofholly]

The OFT will, and do take action, as long as they are provided with enough complaints, AND evidence.

 

They just do not reply to individual complaints - that is more trading standards.

 

I would suggest that if anyone has an issue, and requires a personal response, then complain to Trading Standards. But i would encourage everyone to also complain to the OFT. The OFT will act on weight of numbers - OR actual evidence of offences being committed, so it is imortant to still complain to them.

 

AS for the Data Protection issue - that is for the ICO who are basicly toothless - it's in this area more enforcement power is needed. If the ICO do find in your favour you can sue any company that has breached your data and take them to court. The ICO have an advice leaflet on their website, on this issue. But again complain.

 

As for the OFT guidance on the CCA - they are correct that the lack of an agreement does not mean the debt no longer exists. The problem is the Carey Judgement. But in fact Carey never realy changed anything - it just gave a case for DCA's to missuse - and abuse - and try to manipulate the views of County Court Judges by cherry picking parts of the judgement.

 

There has been a recent appeal to another high profile case - and the judgement is due out next week. Lets hope that has gone the right way, and swing things back in favour of the consumer.

Edited October 19, 2011 by dadofholly

[dadofholly]

The OFT also accepts that once you tell a company a debt is stat barred then that company ceases recovery action against you.

 

So if they persist - report them.

[dadofholly]

Ok... so why are the OFT suggesting that something classed as 'Statute Barred' is still recoverable then... because it isn't really, is it.

 

Do they say that?

 

I know they say it still exists - but that is not the same thing.

[dadofholly]

I would be surprise if the SOL was cut down to 3 years - isn't it logical that it would lead to a higher number of unrecoverable debts? What they should perhaps look at changing to the Scottish way of doing things, whereby a SB debt is dead and not recoverable after 6 years.

 

I would be surprised to.

 

But i think 3 years is more than enough time for a creditor. If they keep their house in order, hold all the correct paperwork and treat people in trouble with respect and are sympathetic to genuine short term problems, then they could enforce debts in the courts against anyone who simply fails to pay or correspond. Then no one would need the amount of debt collection agencies we have.

[dadofholly]

Well i stand corrected. Or rather i'll sit corrected if you don't mind, it's my age

 

They do say though that once you inform a company that it is SB an you won't be paying then they should stop the recovery action.

 

It should cease to exists once it is SB'd, as Ghost points out, similar to the Scottish system.

[dadofholly]

Sounds like they are using a misleading method to try and contact you - thats against the new OFT guidelines. I would complain.

[dadofholly]

I am not sure what the magic number is - but as we have ad 6 so for long it sounds reasonable.

 

What about people who have short term financial problems but then play the waiting game to try and make debts statute barred even though they are in a position to pay them? Under a 3 year system the creditor would have to give up if the person hasn;t recovered financially within 3 years but 6 years gives them more time. Obviously you could extended that to 10 years and so on.

 

The Creditor still has the option of enforcing the agreement via the Courts. If someone has not recovered financialy within 3 years i would call that a long term problem, and a fresh start is probably called for.

 

The problem with 6 years is someone can lose their job, be unable to pay their debts, get defaults and CCJ's against them, and then they find a new job - and become financialy ok again within 12 months. But even though they may have cleared any outstanding debts they still have a poor credit record for another 4/5 years.

 

Their only options then are non-status loans at high interest - Thing is these loans are backed by the same high street banks that probably defaulted them in the first place.

[dadofholly]

If the SOL was reduced to 3 years a side effect might be that creditors are more aggresive in making people bankrupt because they would lose that latter 3 year period when the person may have made some money back. Of course DCAs would probably become far more aggresive as they would have less time to chase debts.

 

With regards to credit records. There are some who have fallen on financial difficulties and some who are just poor debtors - how do you differentiate (without it being complex and expensive) - after all a creditor should have a way of knowing whether the debtor is credit worthy or not.

 

The majority of people in this position have little or no assets - so it would not be financialy viable for DCA's to go down the bankruptcy route.

 

As regards differentiating - you don't - thats the risk a lender takes, whether the SB limit be 3, 4, 5, or 10 years they will still face the same problem. Should we punish the innocent for the sins of the guilty?

 

If it can work in most of europe, parts of the USA and now even the northern territories in Australia, then it can work here.

 

As for DCA's becoming more aggressive - Thats why we have legislation and guidelines to stop them, though admittedly a more robust enforcement procedure would need to be put in place to stop them.

 

The banks already have the right to create money out of nothing, it's not like they realy need any protection, they are already the richest businesses in the world.

 

But consumers are not financial experts and need protection from the excesses of financial institutions who, as we already know, have ripped them off with PPI, Secret Commissions, Bank Charges, Endowment Mortgages and the like.

 

So along with a change in the SB time limit you change the rules on making people bankrupt. The OFT have already stated that this method should not be use as a debt collection tool.

[dadofholly]

"Past performance is no guarantee of future performance" That applies also to consumers! Both ways (good and bad)!

 

Well said Flower

 

Thats why I am against companies being able to do credit reference checks on people as part of their recruitment process, (apart from on people selling financial products etc.), as the CRA's are claiming people with poor credit ratings are a risk to the business.

 

Well I was in Retail management for over 20 years, and some of that as a loss prevention manager, and i can tell you that the correlation between a poor CRA file and the honesty of an individual is minimal. Greed and opportunity is the most common factor behind employee theft and deception. I have worked with, and come accross many senior people in these businesses, that have committed crimes purely to supplement their life styles. Having a poor CRF does not = dishonesty.

[dadofholly]

CitizenB I think he means this doc.

 

http://www.justice.gov.uk/consultations/docs/solving-disputes-county-courts.pdf

[dadofholly]

Indeed.

 

I guess any major change of legislation that may affect the court system will have to consider whether the civil courts could handle the workload. I cannot see a 3 year SOL leading to anything other than more Court cases, so would be surprised if they allowed it - unless there were other things in put place to reduce more cases going to court.

 

Look the rushing to Court claims is just a DCA scare tactic, it's the same as the banks threatening to pull out of the UK if certain legislation is imposed on them. And coming out with crap that they are just to important to the economy.

 

If going to Court was so productive for DCA's they would be doing it now, they dont wait for 5 years and think - oh we have only got a year left best go to Court. If it's productive for them they do it.

 

Companies are now doing pre-employment credit checks and not employing people with poor crf's - so someone can be denied employment for 6 years - when losing their job through redundancey caused the problems in the first place.

 

A lot of private landlords are using the same checks - so someone lose their job, then their home - and now they are going to have problems renting decent accomodation or getting a job for 6 years.

 

If the CRA's want to sell their info for purposes other than what they were designed for, 'CREDIT REFERENCE', then people need protection from unjustly long periods of information detrimental to their future prospects. Most criminal convictions drop off after 5 years.

 

If it was just about Credit i wouldn't disagree with 6 years.

 

I would agree that something between the OC and the Courts in resolving disputes would be a way forward, but grasping and in it for a quick buck DCA's are not the answer.

[dadofholly]

As to employment checks - I agree its a tough one. I have never had a credit check done for work. I can see WHY they are done - but a bit like CRB checks they are limited in their use.

 

Why should they be done?

 

Examples

 

Someone who sell stationary - carries small amount of samples and just takes orders - no cash or credit card handling Should they have a CRF check?

 

Someone who works for a national breakdown company - in a call centre taking calls from broken down motorists and sending the recovery team out - no cash handling - no orders taken - should they be subjest to CRF checks?

 

A warehouse worker unloading lorries on the minimum wage - that is CRB checked. No cash handling again.

 

On what grounds should a CRF check be done for employment - outside of those in the financial services industry?

 

And they are no longer limited - they are becoming incresingly used - even more so than CRB's

Edited October 24, 2011 by dadofholly

[dadofholly]

Perhaps - but that implies DCAs only threaten court. I am sure they could bring up thosuands ofe xmaples where they have taken people to court and won in the 4th and 5th year.

 

From what I have seen the fact that somehting takes 4 or 5 years is either down to the credito being slow for whatever reason or the debtor not being contactable.

 

You mean after 4/5 years they have passed it around enough DCA's before one of them decides to take a punt at getting a default judgement. Most DCA's dont actually go down the CCJ route do they? Why? beacuse its not worth it - they are more interested in chasing the ignorant, vulnerable and profitable - it's a percentage game.

[dadofholly]

As an employer I would want to know as much about potential employees as I could - in reality I don't think CRF checks are needed for the jobs you describe.

 

But i have gave you real life examples - these are jobs that have been advertised. So you would agree that the checks are not needed for these jobs - but they are being carried out. And people are been discouraged from applying for them because they know a credit check will be done.

 

So again why should people need to suffer for 6 years for something that happened to them for a short period in their lives, and not always through their own fault ?- why should CRF's be allowed to sell that information to companies for something that is nothing to do with credit?

 

Thats why it needs to change to 3 years and rules need to be tightened. Hundreds of thousands of people are having cuts in their wages or losing their jobs, many more are unable to keep pace with the rise in household fuel prices, petrol and the overall cost of living.

 

It is not the fault of these people that they may struggle to pay their debts and have black marks against them. So why should ordinary people be stigmatised for 6 years by a system that created the mess. The same system supported by the CRA's and DCA's who are all in bed together, (the deputy chair of experian is on the board of the Credit Services Association i.e the DCA's).

 

Ordinary peole are being made to suffer because of a fraudulant and corrupt financial system. This is not a game it's peoples lives, and people, (human beings) deserve to be treated better than the balance sheets of a company, who has it's business offshore, so it can avoid paying tax on the money it gains in profit.

[dadofholly]

Yes Ghost but they dont do they - thats the problem

[dadofholly]

I dont understand how or rather why you think 6 years is ok for credit issues - surely someone on a consumer forum would be in favour of the consumer rights.

 

And Ghost the employee credit searches are happening a lot more every week - why? because CRA's are pushing it to firms - to make more profit out of the info they hold. To believe otherwise is just burying your head - or wilfully failing to believe such a problem exists.

 

The CRA's are activley selling the service to employers based on some cobblers about security risk - which there is no data for - how do i know i was in loss prevention and the common denominator in employee crime was greed and opportunity, not debt.

Edited October 24, 2011 by dadofholly

[dadofholly]

Click on the positive money link - they have gone through over 500 documents from the Bank of England etc. There is loads of material on there. (If you don't like the site you are prejudging based on your likes and dislikes and not the facts).

 

They are holding a conference this weekend in London, (300 delegates will be there and im one of them), that will be attended by two MP's - Michael Meacher, (Labour) and Douglas Carswell, (Conservative), who both understand this issue and will be among the guest speakers.

 

We also have evidence from Mervyn King, the head of the Bank of England. Paul Woolf, cheif economics editor of the Financial Times, to name just two high profile sources. (Again souced on the Positive Money site - so easy to cross reference).

 

Here is another link to the New Economics Foundation - lots of reference material there. They also wrote and recentley released a book called 'Where Does the money come from' Which is full of information and states all of its sources from organisations such as the Bank of England, Financial Times, European Central Bank and lots more. (If you want to understand the way it works this is the book).

 

Nef Link - http://www.neweconomics.org/

 

Book Link

 

http://www.positivemoney.org.uk/where-does-money-come-from-book/

 

You say this is 'fringe' that is because most economists and MP's etc dont know or understand it - the reason is that this info used to be well hidden.

 

For info on the history of the money reform movement visit http://www.jamesgibbstuart.org/

 

My view of the 'dorks' quote is - it's the ones that think they know how the economy works, but actually no sweet FA, and who call themselves economists - are the real dorks.

Edited October 27, 2011 by dadofholly

[dadofholly]

Chris

 

sorry if i came accross as a bit off hand.

 

I recommend the book.

Edited October 27, 2011 by dadofholly
corrected atrowshush spellin

[dadofholly]

This is popular 7 members and 10 guests

 

It does seem to be popular - i had to check i had put the right links up

[dadofholly]

All I can say about the new guidelines is that when I wrote to the MD of Egg pointing out the parts of the guidelines they had broken, I got a reply from some minion pointing out that the guidelines "had no statuary force and following them was optional"

 

Sadly, he was right, and the inability to report such matters direct to the OFT is to our disadvantage. Yes, you can go to the overworked local Trading Standards, and if you get someone who actually knows the field, a report might get sent to the OFT, depending on how much time and money they have to do so.

 

The OFT is quite simply a talking shop where they publish things to justify their existence, but do very little policing of their own rules. The problems in this field are legion, they have been mentioned in the Commons several times, but no progress on stamping out the bad practice and illegal activities has actually been made. How many DCAs actually lose their licence? Indeed there was the case a year or two ago where one DCA was allowed to practice fro about 9 months after their licence had expired whilst the OFT considered renewing the licence.... farcial

 

The OFT have - and do - take licences off companies who fail to follow their guidlines. So make sure you compain to the OFT direct as suggested by ghost. You can do this via their webiste

 

And don't forget to include the letter you recieved - I am sure the OFT will be interested.

[dadofholly]

If the OFT are so good at regulating these companies, why do we read every day on this site about the misery they cause?

 

To be fair, Egg were partially correct, the guidelines are just that - a guideline to interpretation of the legislation.. It is the legislation that is the governing article. Guidelines are just that. They are a guide as to how to act to stay within the legislation. Breaking the guidelines in itself is not a breach of the legislation .

 

I did in fact send the letter to the OFT and the above is what they said. Action may be taken against a lender for breaches of legislation, but not solely because of a breach of guidelines. The OFT has to be satisfied that a breach of the legislation has taken place.

 

When I pointed to the OFT that Egg stated that they felt following the guidelines were 'optional', and asked the OFT what was the point of having guidelines that lenders felt could simpl;y be ignored, the OFT declined to answer.

 

I'm not saying the OFT don't take action, but they are woefully slow at doing so, and very inefficent also. If they were anything else, this forum would be empty wouldn't it? Lets face it, lenders and their agents break these guidelines and indeed the legislation every day. This fact is well known, hence:

 

 

Hansard 22 Apr 2009 : Column 338, Debt Collection (Consumer Credit Act)

http://www.publications.parliament.uk/pa/cm200809/cmhansrd/cm090422/debtext/90422-0019.htm

 

Now, maybe things have changed since 2009, in which case all posts on this thread must relate to cases before that date..... or maybe things haven't changed much at all.

 

One big problem is that the Guidelines are just that, and it has to be proved that legislation has been broken. Take the case of relentless persuit by an creditor. You may complain that theoir frequent phone calls amount to harqssment. Thing is, you have to prove in court that harassment is taking place... now, I daresay that their will be some of you that claim that pointing out to a lender that their actions were harassment got them to stop. In my case, when they were phoning me on a phone I had given to my 14 YO son, NONE of the so called regulators said they had any power to stop them. It wasn't harassment because that was subjective, and only court had the power to decide if harassment was occurring. They weren't breaking teh Data Protection Act because they were calling on a number I had provided (several years ago) to a bank who had then passed it to a DCA and they weren't actually discussing anything with him, just asking to speak to me..... a get out for every claim.

 

Now, feel free to tell me how rosy the garden is and how law abiding DCAs and teh rest of the industry is......and then say the forum is closing down because as the industry is so law abiding, it isn't needed any more. But count the new posts where guidelines and legislation are being breached, or the consumer is being treated unfairly, before you do.

 

I have neither defended DCA's - nor claimed all is Rosey - and i agree that legislation is needed, and overdue.

 

But if enough people complain about an organisation - and provide evidence the OFT will act - i can tell you that from personal experience. But Rome was not built in a day and the OFT is under resourced.

 

I sympathise with the disgusting harrassment example you give - but the OFT cannot deal on individual complaints - thats the role of Trading Standards - or even the police who you could complain to.

 

It is up to people like you and I to continue to bring thses issues to peoples attention and become involved in groups and organisations that will fight back.

 

I dont disagree with any of your sentiments at all - and certainly do not in any way excuse the actions of DCA's. I am just pointing out they way things are - right or wrong - though we both probably agree they are wrong.

[dadofholly]

Am posting this link in response to some of the arguments here over the limitations for statute barred debts - and many companies now doing credit checks on potential employees.

 

The Government are now cutting the time before a conviction becomes spent - so you can steal a couple of thousand from your employer - get less than six months and your slate is wiped clean after 2 years - but owe a couple of hundred to a DCA and get defaulted - even if you later clear the debt - and you will be reported for 6 years.

 

So it's official - being in debt is now considered worse than committing a crime.

 

http://www.bbc.co.uk/news/uk-16857388

[dadofholly]

CRA are not Govt operated though are they? So does the Govt even have a remit to limit CRA (without introducing legislation).

 

The main thing CRAs have to comply with is the DPA - I presume it is the DPA that allows them to hold data for 6 years?

 

Then change the law dingbat

 

Does statute barred - not mean barred by statute?