Section 40 Administration of Justice Act 1970

Section 40 Administration of Justice Act 1970

Postby kevin » Thu Sep 10, 2009 9:36 pm

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:


#Section 40 of the Administration of Justice Act
# Office of Fair Trading Code of Guidance


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; or
* utters 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 licences.

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 property
* Using 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.

Complaints against DCA's can be issued through the Office of Fair Trading

http://www.oft.gov.uk/advice_and_resources/resource_base/legal/cca/debt-collection

you can find the Code of Guidance notes and the on-line complaints form on their website above
The Office Of Fair Trading has no authority to become involved in disputes between consumers and traders, but what they do is look at complaints made against a company before issuing it with a consumer credit licence (it needs this to operate)
you might think to yourself, one complaint won't make any difference but if there are 10-20 complaints against the same company they may loose their licence so make that complaint today!!!

The Financial Ombudsman Service

These are the people who deal with complaints against banks, insurance companies or finance firms

http://www.financial-ombudsman.org.uk/consumer/complaints.htm#1

Again, the more complaints listed against a business the better.

.
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Re: Section 40 Administration of Justice Act 1970

Postby Jim » Thu Sep 10, 2009 10:08 pm

Nice :) Did you prepare this yourself?

Presumably companies seeking recovery of debts or acting as creditors will be subject to the Administration of Justice Act because it's statutory law (please tell me if you think I'm wrong!) but what about the OFT Code of Guidance? Is this a voluntary code of conduct that looks good on paper like the Courts Charter that states "When you come to court you will find courteous, polite, helpful staff"?
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Re: Section 40 Administration of Justice Act 1970

Postby kevin » Thu Sep 10, 2009 10:19 pm

No, I stole it, it looks like DCA's need a licence and if they break these practices they could loose their licence...wouldn't that be a shame

http://www.insolvencyhelpline.co.uk/debt_factsheets/harassment_of_people_in_debt_by_creditors.php

Office of Fair Trading

Debt collection guidance
Final guidance on unfair business practices

http://www.oft.gov.uk/shared_oft/business_leaflets/consumer_credit/oft664.pdf

What is the purpose of the guidance?
1.5 This guidance is intended to set out the type of behaviour the OFT considers to fall
within the category of unfair business practices which will call into question fitness
to retain or be given a licence. It is expected that applicants and licence holders
will abide by the spirit as well as the letter of this guidance. Publication of this
guidance will also enable the OFT to take speedier action against behaviour that
clearly falls into the type of categories of unfair practices shown.
1.6 This guidance is not designed to be a comprehensive checklist of behaviour. Nor
are we advising on best practice or a code of practice. The guidance outlines unfair
practices with illustrative examples. The examples given are based on OFT
complaint information and issues brought to our attention by organisations
representing consumers, business and other regulators.
Who does this guidance apply to?
1.7 This guidance applies to all consumer credit licence holders and applicants.
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Re: Section 40 Administration of Justice Act 1970

Postby IamallthatIam » Thu Sep 10, 2009 10:26 pm

Good post kevin , this will help a lot of people undrstand what is unacceptable and why , thank you
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Re: Section 40 Administration of Justice Act 1970

Postby Sophia » Tue Sep 29, 2009 11:29 pm

Fantastic post thanks! Just what I'm dealing with now. Really useful, now I can write a few more letters :giggle: Thanks!
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Re: Section 40 Administration of Justice Act 1970

Postby huntingross » Wed Sep 30, 2009 11:45 am

Ditto....just logging my interest....thanks.
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