Harassment of People in Debt by Creditors

Harassment

Harassment of people in debt by creditors or their agents is a criminal offence under the Administration of Justice Act 1970. It is often difficult to know what to do when you feel a creditor is not dealing with your account fairly. In order for you to identify what activities by your creditors may involve harassment and what can be done about the problem, this factsheet outlines:

The relevant section of the Administration of Justice ActThe Office of Fair Trading (OFT) Debt Collection Guidance on harassmentHow to deal with harassment by your creditors.

SECTION 40 OF THE ADMINISTRATION OF JUSTICE ACT

S40 Punishment for unlawful harassment of debtors.

1. A person commits an offence if, with the object of coercing another person to pay money claimed from the other as a debt due under a contract he: harasses the other with demands for payment which, in respect of their frequency, or the manner or occasion of making any such demand, or of any threat or publicity by which any demand is accompanied, are calculated to subject him or members of his family or household to alarm, distress or humiliation; falsely represents, in relation to the money claimed, that criminal proceedings lie for failure to pay it; falsely represents himself to be authorised in some official capacity to claim or enforce payment; orutters a document falsely represented by him to have some official character, or purporting to have some official character which he know it has not.

2. A person may be guilty of an offence by virtue of sub-section (1) (a) above if he concerts with others in the taking of such actions as is described in that paragraph, notwithstanding that his own course of conduct does not by itself amount to harassment.

OFFICE OF FAIR TRADING CODE OF GUIDANCE

Many activities could count as harassment. It is important to note that anything done by a person which is reasonable when trying to recover a debt, is not considered to be harassment. Both the Office of Fair Trading and Trade Associations (run by the credit industry) have produced guidance on what activities may be considered harassment and should therefore be avoided by creditors. The following list is taken from the new Debt Collection Guidance for holders of consumer credit licenses.

Creditors are warned by the Office of Fair Trading under the Debt Collection Guidance that the following practices are "considered unfair":

IT IS UNFAIR TO COMMUNICATE, IN WHATEVER FORM, WITH CONSUMERS IN AN UNCLEAR, INACCURATE OR MISLEADING MANNER.

This includes:

Letters that look like court claims

Not making it clear who the company is or what their role is

Unhelpful legal language

Not giving balance statements about the debt when asked

Contacting you at unreasonable times even when asked not to

Asking you to contact them on premium rate phone numbers.

THOSE CONTACTING DEBTORS MUST NOT BE DECEITFUL BY MISREPRESENTING THEIR AUTHORITY AND/OR THE CORRECT LEGAL POSITION.

This includes:

Claiming to work for the court or be a bailiff

Implying action can be taken that is not legally possible such as implying they could take your propertyusing a business name or logo that implies they are a government body

Implying that court action has been taken against you when it hasn't

Implying not paying your debt is a criminal offence

Threatening to take court action in England if you live in Scotland or the other way round.

PUTTING PRESSURE ON DEBTORS OR THIRD PARTIES IS CONSIDERED TO BE OPPRESSIVE.

This includes:

Contacting you too frequently

Pressurising you to sell property or take out more debt

Using more than one collection company at the same time or not telling you when your debt has been passed to another company

Pressurising you to pay in full or in large instalments you cannot afford

Making threatening gestures or statements

Ignoring disputes about whether you owe the money

Trying to embarrass you in public or threatening to tell a third party about your debts such as a neighbour or your family.

DEALINGS WITH DEBTORS ARE NOT TO BE DECEITFUL AND/OR UNFAIR.

Examples include:

Sending letters addressed to the occupier or discussing the debt with someone without knowing if they are you

Refusing to deal with an adviser acting on your behalf

Not accepting reasonable offers or passing on payments you make

Refusing to freeze action if you dispute the debt.

CHARGES SHOULD NOT BE LEVIED UNFAIRLY.

Examples include:

Claiming collection costs when the original credit agreement didn't allow this to happen and making you think you are legally liable for the costs

Not putting the specific amounts that can be added for collection costs in the original credit agreement

Adding unreasonable charges.

THOSE VISITING DEBTORS MUST NOT ACT IN AN UNCLEAR OR THREATENING MANNER.

Collectors should explain the reason for any visit and give you notice of the time and date they will call

They shouldn't visit if they know you are ill or vulnerable and if they find you are unwell or distressed they should leave

They should not come in if you do not want them to and should leave when you ask them to

They shouldn't visit you at work or somewhere like a hospital.

HOW TO DEAL WITH HARASSMENT BY YOUR CREDITORS

The first step is to write to a creditor and outline your concerns about the company's behaviour. Inform them that you are familiar with the terms of Section 40 of the Administration of Justice Act and ask that the creditor takes steps to avoid similar occurrences in the future.

Tell your creditors how you would prefer to be contacted and ask that they confirm their agreement to this. A letter at this stage may avoid the need to take further action against the company.

Tell them you are aware of the OFT Debt Collection Guidance and that you will consider making a complaint about their behaviour under the guidance.

It is usually difficult to persuade the police to prosecute in cases of harassment unless a more serious offence such as violence, fraud or blackmail is also involved. Normally complaints should be made to the trading standards/consumer protection department at your local council.

They should investigate whether an offence has been committed and whether prosecution is appropriate. The penalty is a fine of up to £5,000 in the Magistrates Court. Also a conviction is likely to provide evidence that the creditor is no longer a fit and proper person to hold a consumer credit licence.

If Trading Standards will not act it may be worth contacting the Office of Fair Trading directly. The address is at the end of the factsheet. The OFT does not usually take up individual complaints but their Debt Collection Enforcement Team collects information that can be used to take action against creditors who can lose their consumer credit licence.

The creditor may be a member of a trade association with a code of practice. You could find out if your creditor is a member of a trade association and write to them with your complaint. A code of practice is not legally enforceable but the association may take some action against their members. Details of the main trade associations are at the end of the factsheet under "Useful Addresses".

OTHER OPTIONS

Another alternative is for you to pursue your own prosecution in the Magistrates Court. This could involve considerable cost so you need to obtain proper legal advice first.

BT have a new service called "Choose to Refuse" which might help if you are getting a lot of calls from an unpleasant creditor. You have to key in a pin number after a call. The caller will then get an automated message if you don't wish to take their call when they ring. The cost of the service is £8.00 per quarter.

If you receive a telephone service from another provider, contact them and ask if they have a similar service.

You could refer to the Malicious Communications Act 1988. This deals with the sending of letters or articles for the purpose of causing "distress or anxiety". A person found guilty can be fined in the Magistrates Court.

To prosecute successfully, the letter or article sent would have to convey:-

A message which is indecent or grossly offensive

A threat; or information which is false and known or believed to be false by the sender.

The Criminal Justice Act & Public Order Act 1994 Section 4a makes it a criminal offence to causeHarassment, alarm or distress with intent by using threatening, abusive or insulting words or behaviour.

This can only be an offence if it happens in a public place not in your own home. The police would need to be contacted and prosecute for this offence.

The Protection from Harassment Act 1997 makes it a criminal offence to harass people and put people in fear of violence. The harassment must happen on at least 2 separate occasions. The police would have to agree to prosecute for this offence.

USEFUL ADDRESSES

The Finance & Leasing Association (FLA)
2nd Floor, Imperial House
15-19 Kingsway London WC2B 6UN Tel No: 020 836 6511
www.fla.org.uk

The Consumer Credit Trade Association (CCTA)
Suite 8, The Wool Exchange
10 Hustlergate
Bradford
BD1 1RE
Tel: 01274 390 380
www.ccta.co.uk

Credit Services Association Ltd (CSA)
(For Debt Collection Agencies) Wingrove House
2nd Floor East Ponteland Road Newcastle upon Tyne NE5 3DP
Tel: 0191 286 5656
www.csa-uk.com

Consumer Credit Association (CCAUK)
Queens House Queens Road Chester CH1 3BQ
Tel No: 01244 312 044
www.ccauk.org

Mail Order Traders' Association (MOTA)
7 Floor
100 Old Hall Street
Liverpool
L3 9TD
Tel: 0151 227 9456

Office of Fair Trading
Fleetbank House
2 - 6 Salisbury Square
London
EC4Y 8JX
Tel No: 08457 224 499
www.oft.gov.uk

If your complaint is against a solicitors firm acting for a creditor, a complaint can be made to:

Consumer Complaints Service
The Law Society
Victoria Court
8 Dormer Place
Leamington Spa CV32 5AE Tel No: 0845 608 6565
www.lawsociety.org.uk

The author, Michael Sherriff, has written 100's of articles realting the UK credit and finance industry. Family and personal money matters can often be a great concern and in some cases lead to depression or even suicide.

This is something that has affected Michael personally and since then has carried out extensive research into the financial industry and released articles to educate those that need advice.

His ebook "UK Credit Secrets 2005" has become a UK best seller for anyone wanting to know the truth about credit repair and what they can do to repair their credit history. Find out more at UK Credit Secrets

More Resources

Unable to open RSS Feed $XMLfilename with error HTTP ERROR: 404, exiting

More Credit Information:

Related Articles

Have You Ever Opened a Checking Account?
Maybe some of you are saving it in your trusty piggy bank, under your mattress or way back in a sock drawer. Although I'm glad that you are saving, your money is not doing anything for you locked up in your house.
Useful Tips On Avoiding Credit and Charge Card Fraud
Credit and charge card fraud costs cardholders and issuers hundreds of millions of dollars each year. While theft is the most obvious form of fraud, it can occur in other ways.
Commercial Collections: Business Finance Booster Shot
Commercial collections: fixture of the new B2B cultureIf you're in the business-to-business field, or even if you're a consumer products business that works through third-party distribution channels, you probably know what it's like to check your mail anxiously each day, sifting through all the bills for that payment that was supposed to have been in months ago.It wasn't supposed to be like this.
Credit Cards For People With Bad Credit Scores
Sometimes life lands you in a situation that causes your credit to suffer. A job loss or illness can send your credit rating south leaving you with nothing to do about it.
Identity Theft Exploding: Here's How You Can Avoid Becoming A Victim
Americans are more concerned about identity theft than unemployment or corporate fraud, according to a survey of 2,000 people conducted by Star Systems.Nine out of ten Americans demand new federal legislation, while two-thirds say the financial services industry needs to do a better job of verifying the identity of customers who open bank accounts (66 percent) and credit card accounts (72 percent).
Credit Cards: Pros and Cons
Sure, there are a lot of problems with credit cards, but there are a lot of good things attached to them as well. For instance, if you have a small business, fleet credit cards can keep your books in order when you issue them to drivers of company vehicles for gas and automobile repairs.
I've Heard About FACTA; What Does It mean?
What FACTA means is that if you, as an individual, lose the information on anyone you have ever hired; or, for any business in the United States of America that collects any personal information on people, if the information should be lost due to not destroying the information properly, then two things can happen. First, there are federal fines of up to $2,500.
New Law Provides Free Annual Credit Report
As of Thursday, December 1, 2004, one-third of Americans will be able to access their credit reports from all three main agencies for free. Passed in late 2003, the Fair & Accurate Credit Transactions Act creates a central source consumers can use to obtain a free annual credit report.
Is Your Credit Score Costing You Money?
Most of us want a good credit report to obtain automobile financing, credit cards, and to purchase a home. But, beyond these consumer loans, your credit report can cost you in everyday living expenses.
Figuring Out the Ever Nebulous Numbers Called Credit Scores
Credit Score FactorsThe information contained on our credit reports affect every aspect of our lives; including employment, insurance, and even interest rates (mortgage, credit cards, automobiles, etc.).
Taking Control of Your Credit History
Your credit history is important; in fact, in this day and age, only family and your time are more important than your credit history! The first time you established a payment commitment over a period of time for a purchase, you began your history of credit, and the credit bureau created your account. Payments such as the electric company, a rental agreement, a cell phone, a car payment or a low-rate credit card which you also have a responsibility to repay are not reported to the credit bureaus as a part of your credit history.
Looking for that Low interest Credit Card?
If you have been shopping around for a Low Interest Credit Card you will notice that the UK market is awash with Credit Card companies offering low rates to entice you to apply for their Cards.There has never been a better time to consolidate your credit cards and get a far better interest rate.
What Are the Most Common Ways to Commit Identity Theft or Fraud?
It's the number one source of consumer complaints at the Federal Trade Commission (FTC), and unfortunately, it's one of the simplest crimes to commit. Identity theft involves information from your daily life, from shopping, bill-paying, and even applying for a job.
Can Credit Search Entries Affect Your Ability to get Approved for a New Loan in the UK?
About Search Entries:Every time a lender checks your credit history from your credit file (i.e.
Check Your Credit Before Shopping For That Home Loan
Review Your Credit Score.Nearly every bank, credit union, and mortgage lender relies on a three digit score provided by one of the three major credit bureaus to help them make lending decisions.
Credit Cards: What is the Universal Default Clause?
Most people who carry major credit cards are well aware that the interest rates associated with them tend to be higher than for other types of lending, such as home or auto loans. Anyone who has paid their credit card bill late more than once or twice is also aware that doing so may cause the interest rate on their card to go up - sometimes by quite a lot.
Building A Credit Report Lenders Will Love You For
Will lenders really love you for having a good credit report score? Love is not the right word of course; lenders are after your money, and never forget that. But the lender's representative will love dealing with your credit application if your credit report is good.
Beware of Falling Minimum Payments
If you opened a credit card statement recently and were pleasantly surprised to find that your minimum payment due was lowered, don't be so quick to "jump for joy". What may appear as a small boost to your monthly budget is actually the rock that can weigh you down in debt for a lifetime.
Trying to Land a Job? Poor Credit Scores May Hurt Your Chances
Many employers are now looking at an applicant's credit report for hiring purposes. During an interview process a potential employer may request your written consent to access your credit report.
Dont Trade Your Future for Todays DooDads
"Easy Low Down Monthly Payment," "Buy Now Pay Later," "You Deserve the Car Today and We Can Finance It for You," & "Spend Today, 0% APR until Next Year!" We see those statements above every where today, on TV commercials, car dealership, banks and magazines. Those statements have put a lot of people into a financial disaster, because the statements make a lot of people believe that acquiring bad debts is an ok thing to do.