To: Sajid Javid MP, Secretary of State for Business, Innovation and Skills.
Tighter Regulation of Debt Collection
Ban the practice where Debt Collection Agencies buy up old debts for a fraction of their face value then pursue the alleged debtor for the full face value.
Why is this important?
The Credit industry in the UK already has plenty of tools to use when pursuing debtors who will not pay their debts, to the point of getting a County Court Judgement and then engaging Bailiffs to go after the debtor or repossessing property. In addition, they are under a duty to work with debtors who find themselves unable for whatever reason to pay their debts as originally agreed and to find more suitable ways of repaying the debt.
The fact that a company will sell an old debt for a fraction of its face value means that the debt has already been written off and all options for collecting the debt have failed. Almost without exception, these companies do not exercise any form of due diligence to find out whether the alleged debt is still valid. In many cases, it isn't. Instead, they write threatening and intimidating letters to potentially vulnerable people about old debts which may well have been forgotten about.
This practice is unfair given the vast array of tools already available to the credit industry. It is not in the interests of the Credit Industry because the debts sold have already been written off. The practice is born of sheer greed and benefits nobody except the companies engaged in it. For that reason, it needs to be banned.
The fact that a company will sell an old debt for a fraction of its face value means that the debt has already been written off and all options for collecting the debt have failed. Almost without exception, these companies do not exercise any form of due diligence to find out whether the alleged debt is still valid. In many cases, it isn't. Instead, they write threatening and intimidating letters to potentially vulnerable people about old debts which may well have been forgotten about.
This practice is unfair given the vast array of tools already available to the credit industry. It is not in the interests of the Credit Industry because the debts sold have already been written off. The practice is born of sheer greed and benefits nobody except the companies engaged in it. For that reason, it needs to be banned.
