FOS identify complaints about Debt Collection Agencies

20th November 2009

The November/December issue of the FOS publication 'Ombudsman News' has focused on recent complaints by debtors regarding Debt Collection Agencies (DCAs).

Since April 2007, the ombudsman service has covered complaints made by consumers against debt recovery companies collecting money on behalf of consumer credit lenders.

The publication highlights a number of cases and the outcome after the involvement of FOS. These can be complaints brought by any consumer from whom the debt collector attempts to recover the consumer credit debt - not just by the person named on the credit agreement. In the first instance the complainant should contact the business in question. Complaints illustrated include:

• Mis-tracing – chasing the wrong person for payment
• Disputes about the amount owed or indeed whether any money is due. This may relate to the quality of records in adding charges and in some instance poor quality information provided by the instructing lender
• The approach to collecting a debt. Has the collector harassed the consumer or breached the OFT Debt Collection Guidance

FOS takes into account whether the DCA has breached industry codes, such as the Credit Services Association (CSA) Code of Practice. They expect businesses to keep proper records of their visits to consumers - and of their written and phone communications with them - and to be able to produce relevant records to support their case, if a complaint is made against them.

FOS's role is to try and arrive at a fair agreement. The DCA must take a realistic and proportionate approach to the consumer's proposals, including those proposed my an appointed money advice agency or Debt Management Company. Equally, the consumer must be willing to engage in the process and should not simply ignore reasonable requests to provide a proposal showing how they intend to repay the debt.

Where FOS decide that a debt collecting business has not dealt reasonably with a consumer, they will normally tell it to pay appropriate compensation as redress (and they may direct that this should be used to reduce the debt). However, they will not normally conclude that the debt should simply be written-off.

Kevin Still, Director of EuroDebt, commented: "It is very important to take a balanced view of events leading up to the complaint. As a Debt Management Company, we find that most Debt Collection Agencies that are CSA members abide by the Code of Practice and are willing to work with professional Debt Management Companies like EuroDebt. Having a true representation of the client’s statement of affairs supporting a repayment proposal is very important and having a debt advisor directly corresponding with the collector on the debtor’s behalf can take the emotiveness out of negotiations."

For the full story read the FOS article on recent complaints involving debt-collecting businesses.

• Share
• 
• 
• Store
• 
• Follow
•