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Debt Collector Mistakes on The Rise

More and more people are being harassed by debt collectors, and according to information recently released by the BBC the government of the United Kingdom is getting ready to hold talks with representatives of the debt collection industry. Consumer Minister Gareth Thomas will be meeting with the representatives in an effort to limit the amount of people that are targeted by debt collectors as the recession that has gripped the world deepens. According to the Credit Services Association, cases of mistaken identity when it comes to debt collecting will continue to happen as long as they do not have access to the full electoral register. Thomas is hoping the high-level talks will address the worsening problem.

In a statement issued by the Consumer Ministry, Thomas stated, “I am increasingly concerned about some of the practices that we are hearing about used by debt collection agencies. There is often psychological harassment with constant phone calls; in some of the worst cases we've seen neighbours contacted, and people's work phoned.”

At the moment the government has no idea how many innocent people are being targeted by debt collectors. Even the people working as debt collectors are growing concerned over the mistakes that are being made, fearing that the number of innocents that are contacted will continue to rise as the recession lingers on. Debt collectors are controlled by guidelines that ban certain practices when trying to find debtors, and the guidelines state that harassing consumers is illegal. Unfortunately, during the research the BBC did on this problem they found evidence of ‘fishing trips’ where the collectors contact people with similar names to the real debtor.

Debt collectors who use these illegal practices have basically scared innocent people. One lady who has no debt continually receives harassing letters from a debt collector demanding money and threatening legal action on something that she doesn’t owe and has never owed.

  • According to the Credit Services Association, mistaken identity like this will continue to happen because they only have access to a version of the electoral roll that is edited. Currently there are proposals in the government to take away access to the electoral roll all together. The association feels that this will only make the problems worse and keeps asking for full access. They are also asking the government to set up a national address register that would make it a criminal offence if a debtor moves without informing their creditors of their address change. The Credit Services Association is trying to work with the government to come up with a viable solution and stop the mistakes that are being made.
Credit Services Association director Godfrey Lancashire feels that cooperation on all fronts “wouldn't absolve us from all blame and, if we're going to do anything, we'll talk about it and we do take strong action. We do have teeth and a year ago - it's very rare - but a member was in breach of guidelines and we expelled them from our association and reported them to the Office of Fair Trading. So we do have teeth and we will take appropriate action, but it's got to be joined up. It's us, it's the OFT, it's the information commissioner, it's the financial ombudsman and it is the government doing something we recommend.”
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