Posts Tagged ‘debt collection agencies’

New Lending Code 9: mental health, debt agencies

November 19, 2009

181. If a subscriber has received appropriate and relevant evidence of a customer’s mental health problems they should consider whether it is appropriate to pass or sell the customer’s debt to a third party debt collection agency. [Reproduced with the kind permission of the British Banking Association -see link below]

I can see no justification whatsoever for a creditor using an agency or selling the debt on once it is aware the customer is in the vulnerable groups. Certainly in the vast majority of cases hectoring is not what is required, even less the harassment, worry and fear of these crude methods.

Much, much more is likely to be achieved by a sympathetic and supportive approach. I wonder about the decision making process that has developed the current blind and thoughtless path.

By the very nature of their situation few vulnerable debtors are likely to be in a position to clear a debt immediately. And often their incomes are so inadequate that it is unlikely recovery of the debt is likely.

Where that is the case all blindly cold processes are pure waste of money. At best they are deliberately cruel, and at worst actually sadistic. The latter is in itself a mental health issue, as it happens – but this time on the other side of the debtor-creditor divide.

Of course not all vulnerable debtors are in poverty or poor. But where the only assets are a house, or the means of getting through their day without difficulty, pursuit raises issues of human rights.

Far better, then, to approach all such cases with skill, knowledge, understanding, and sympathy. This form offers support to just that.

At the same time it should not be turned into a requirement in all cases. Where it can contribute and their is agreement to use it is, without question, an invaluable aid in working out the best course of action.

Joseph Harris, Debt Control Man
Author: Control Your Debt Crisis on Your Own Terms

The new Lending Code is here
The MALG 2007 submission to the review of the code is here
And the Treasury Select committee view is here


Low Cost Online Bankruptcy

April 11, 2009

Let me just apologise for the long gap in my blogs. Sometimes things do not go as one would like, and – as Robert Burns put it – The best laid plans of mice and men / Gang oft aglay [’aglay’ is Scots dialect for ‘awry’, or simply ‘wrong’ – ‘gang’ for ‘go’ – ‘oft’ is short for ‘often’.]


I am now back with some moderately good news for low income readers with debts below £15,000. A new service – DRO, Debt Relief Orders – is now in effect according to The Financial Times.


This enables those who qualify to become bankrupt for £90, as opposed to the £500 or so in court fees for the conventional service. Access is through a third party, with the Citizens Advice Bureaux the most often mentioned in reports and comments.


This can be a great relief to those caught in the debt trap with no way to pay, and with creditors or their debt collecting agencies harrassing [forbidden under the Consumer Protection Regulations 2008].


With the trend for the economy down the likelhood for most of us of getting an income to beat our present ones is small. And for the small debtor [and £15,000 is small today] this is a helpful possibility.


I have now my website – – open and the first part of my book on offer. My debtwiki has been massively spammed and I am just in the process of turning it into a conventional Debt Dictionary.

Look forward to your visit.

Joseph Harris

Debt Control Man