Are debt collection agencies regulated?

People who collect debt or who buy debt with a view to collect it themselves are known as debt collection agencies. Because of complaints and confusion as to what these companies could actually do with regards to collecting debts, the OFT introduced guidelines as a way of protecting members of the public. Debt collection agencies are expected to follow a certain standard of behaviour when dealing with the people whom owe money.

Debt collection agencies have to hold a license, this is required under the The Consumer Credit Act of 1974. These agencies are required to ensure that any personal information they hold on a person is correct and up-to-date. They are not allowed to send collection letters to the wrong address, nor are they allowed to send a letter to a neighbour in the hope of finding the person who owes the debt. The OFT reports that the most common complaint received regarding debt collection agencies is the fact they hold inaccurate information on a person. This is usually as a result of a mix up when the debt has been passed from the original lender to the agency.

How debt collection agencies act when visiting a property or calling a person is heavily regulated. If a debtor requests a collection agency stops calling their phone, they must comply with this and correspond with the debtor by post. They are also not allowed to call a person at their place of work unless they have received express permission from the person. When attending a person's property for the first time, they are not allowed to force entry, nor are they allowed to push past the debtor to enter the property. If violence ensues on behalf of the debtor the collection agent should call the police after removing themselves from the situation. A collection agent also has to give a person 24-hours notice of a visit to remove goods.

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