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Debt Collection News


Released every month our debt collection blog contains news, stories and tips to keep you informed.

2011 Bankruptcy Statistics

Wednesday, September 14, 2011 - Posted by Philip Harvey

These figures exclude corporate insolvency and are the provisional figures available on the ITSA website. 

Bankruptcies Debt Personal Insolvency Total
(Parts IV and XI) Agreements Agreements insolvency
 

   (Part IX) (Part X) activity
                         
         
       

 
  10/11 09/10 % Change 10/11 09/10 % Change 10/11 09/10 % Change 10/11 09/10 % Change
 

 

 


 
 
NSW 8133 9754 -16.62% 2666 2734 -2.49% 120 160 -25.00% 10919 12648 -13.67%
 

 

 

 

 
ACT 185 249 -25.70% 98 100 -2.00% 1 2 -50.00% 284 351 -19.09%
 

 

 

 

 
VIC 4518 5716 -20.96% 1734 1994 -13.04% 100 291 -65.64% 6352 8001 -20.61%
 

 

 

 

 
QLD 6148 7011 -12.31% 2240 2281 -1.80% 72 69 4.35% 8460 9361 -9.63%
 

 

 

 

 
SA 1604 1949 -17.70% 338 323 4.64% 5 17 -70.59% 1947 2289 -14.94%
 

 

 

 

 
NT 107 149 -28.19% 54 64 -15.63% 0 2 -100.00% 161 215 -25.12%
 

 

 

 

 
WA 1694 1893 -10.51% 624 705 -11.49% 55 33 66.67% 2373 2631 -9.81%
 

 

 

 

 
TAS 713 786 -9.29% 300 227 32.16% 6 4 50.00% 1019 1017 0.20%
                         
Total 23102 27507 -16.01% 8054 8428 -4.44% 359 578 -37.89% 31515 36513 -13.69%

Debt collection client online access improvements

Wednesday, September 07, 2011 - Posted by Philip Harvey

We have been listening to all our clients and receiving feedback on how we can improve our client online access.

This months new feature is an improvement in the way you can navigate and view comments within a debt. The number of comments that appear on a screen have been increased, and you can now skip to the first and last pages with the press of a single button.


Hells Angel member charged with unlawful debt collection

Thursday, September 01, 2011 - Posted by Philip Harvey

In New Zealand, a Hells Angel member charged with unlawful debt collection has been granted bail. The Hells Angel member was one of three Hells Angels members arrested for allegedly using a document titles "warrant to repossess" to repossess a Toyota Hilux ute and Dingo Digger from an undercover police officer. The police officer was undercover as a person who had multiple debts and was struggling to make payments.

Police had opposed bail because of the Hells Angels member seniority within the group and were concerned that the Hells Angel member would interfere with witnesses or prevent others from coming forward and he would continue working as debt collector. The Judge declined this request on the basis that the witnesses knew who they were dealing with at the time and there was no evidence to suggest that witnesses would be intimidated.

The Hells Angel member was ordered to not have any association with the debt collection businesses he was dealing with and to stay at his residence until the next court appearance.


Using the Legal System to Collect Debts in Australian Capital Territory

Monday, August 01, 2011 - Posted by Philip Harvey

Originating Claim & Statement of Liquidated Claim 

After expiry of default notice the initiating action in the Magistrates’ Court is a Claim.

  • Can be served via post or in person
  • Can apply for Judgment 28 days after service

* Magistrates’ Court does not deal with matters under $10,000. Disputes less than $10,000 are fall within the jurisdiction of ACT Civil and Administrative Tribunal (ACAT).

* ACAT costs $123.00

* Costs for Original Claim and Statement of Claim between $764.00 to $1,334.00 depending on amount

This can be compared against the other states and territories here.

 
Judgment

  • This action formally registers the debt with the court and allows further collection action.
  • Judgment stands for 12 years.

*Obtaining Judgment costs between $500.00 to $1,350.00 depending on amount of Claim (undefended)

This can be compared against the other states and territories here.


Once Judgment granted then 4 choices of enforcement proceeding are possible.

Before enforcement of the Judgment the debtor must be served with a copy of the Judgment made against them. Further enforcement must not commence until 7 days after service has been affected on the debtor.


Enforcement Hearing Subpoena

  • This is used where you are unaware of Debtors Assets, Employment.
  • Documents are personally served on the debtor to attend court.
  • Hearing is conducted by the Registrar and debtor must provide details of income expenses and assets.
  • Registrar may make an Order for Instalments, Earnings Redirection or Seizure and Sale Order at this hearing.
  • If debtor doesn’t attend then you can apply for a Warrant.

This can be compared against the other states and territories here.

*Cost is $139.00 to $562.00 for the Court Application + preparation (attendance charges additional) (undefended).

Redirection Orders

  • Three types – Earnings Redirection, Debt Redirection and Regular Redirection
  • Must know the financial institution details or employers details
  • documents are served on the financial institution or employer
  • A copy of the Order must be served on the debtor within 5 days of service on the financial institution or employer
  • Financial institution, employer or debtor may apply to rescind or vary the Order on the grounds of financial hardship

Recommend an Enforcement Hearing Subpoena prior to the Redirection Order to obtain current financial details

* Cost is $91.00 to $249.00 depending on amount of Claim for the Court Application + preparation (attendance charges additional) (undefended).

This can be compared against the other states and territories here.

Seizure and Sale Order

  • Sheriff attends property of debtor to demand payment and tag any assets of value.
  • If payment cannot be made goods to the value of the debt are seized and sold.

*Cost is $345.00 to $460.00 depending on amount of Claim (undefended)

This can be compared against the other states and territories here


Bankruptcy

  • Judgment must be obtained then a bankruptcy notice served.
  • Once Bankruptcy notice has expired then Bankruptcy can be applied.
  • Once bankruptcy obtained all debts owed by the debtor are captured under the Bankruptcy.

*Cost is a minimum of $2500.00 if matter is undefended (after Judgment costs)

 

* Important Note: All costs are estimates as at 16/08/2011 and do not include costs of counsel and preparation for hearing.


US owed 65Billion in Debts

Monday, July 18, 2011 - Posted by Philip Harvey

The New York times recently reported on a Study performed by Martin H. Pritikin of  Ezra Ross Whittier Law School and UCLA School of Law that Corporates, White Collar Criminals, Polluters and Fraudsters owe the US Government more than $65 billion US.

The study delves into the structure of the collection activity and found that;
- Responsibility for Collection of Bad Debts is dispersed. In collecting criminal debts, it is placed amount 94 different US attorney offices with a success rate of just 4%.
- The mining regulator had a similar success rate of just 5%.
- There is no incentive for agencies to collect their debts, with all funds being recovered going back to the government (not retained by the agency).

In some cases there was never going to be any chance of success, cited examples being officers of National Century Financial Enterprises, an Ohio health finance company. They were ordered to pay fines of $2.38 billion for defrauding investors. They’ve paid  about $3 million. Many of them are in prison.

In other cases, there have been better opportunities for success. Sales of mining companies have been allowed to proceed in the mining  even with fines owing. If legislation is not already in place, the legislators do not need to be to inventive to capture these fines.

The key lessons from this are responsibility, accountability and incentive for collection teams.


Centrelink Payments and Debt Collection

Thursday, July 14, 2011 - Posted by Philip Harvey

There are rules surrounding Centrelink payments and paying back debt. You can only take funds from someones savings account in very limited circumstances of where a debtor overdraws a Savings Account. You cannot take funds to pay a Loan Account, only an overdrawn savings account.

Further to this, where a debtor has overdrawn a Savings account you are limited to how much you can take from the Debtor from future Centrelink Payments. This is limited to 10% of the Centrelink payment, with the debtor retaining 90% of the funds. 

There are limited instances where Centrelink Payments are not protected. These include;
  • fraudulent transactions
  • dishonest transactions
  • all other unlawful transactions, conduct or activity

Improved Client Online Access - loading multiple debtors and viewing documents online

Wednesday, July 13, 2011 - Posted by Philip Harvey

We have been listening to all our clients and receiving feedback on how we can improve our client online access.

As a result, we have now added 2 new features;

1. The ability for you to download attachments that LCollect saves to file. This includes items such as Statements of Claim, Examination Orders, Writs etc.

2. Loading up to 3 Debtors when referring a new debt online. 


Debt collection expedition goes wrong

Thursday, July 07, 2011 - Posted by Philip Harvey

Ballyforemort - Ireland.

A Father and Son team were collecting a debt from a minor criminal of 200 euros. Driving in a jeep to the debtors home, as they arrived at the home, the Son saw the debtor and quickly jumped out of the jeep with an iron bar in hand.

Unbeknown to the Son, the debtor was carrying a knife. A violent struggle followed resulting in the Son with the iron bar being stabbed numerous times. In the struggle both men fell to the ground. In the confusion that follows, the Father somehow drove over his son. The resulting injuries were a broken pelvis and a crushed femur. His leg injury was so serious it may have to be amputated.

It likely that two of the three men involved will face charges.

Note that those involved were not licensed collectors.

This story was sourced from the Herald.ie


First Online Lodgement of Judgment for Land and Writ for Possession of Land

Wednesday, July 06, 2011 - Posted by Philip Harvey

LCollect in conjunction with Collection Law Partners Pty Ltd are the first to electronically lodge a Judgment Application for Possession of Land and Writ for Possession of Land in the Supreme Court of NSW. This has been achieved using Justicelinks eServices. 

For our clients, this represents a much more superior and efficient delivery of services in Mortgage Default matters. With the entire process now electronic through the Supreme Court, significant time / speed advantages have been delivered to our clients.


UK Underbelly Debt Collection

Wednesday, June 22, 2011 - Posted by Philip Harvey

This article presents a very long list of the DON'T's in debt collection.

We always here tales of how the underworld collects debts. In Farnbourgh, UK, the police have organised a community scheme where people who were previously involved in the drug underworld are volunteering to speak to teenagers in schools about their experiences. 

One of the people previously involved in a life a crime, John, has been sharing his experiences in collecting money owed to drug dealers - a Debt Collector in the underworld.
In discussion with John, he said;
“Basically I would go around and get money off them.” 
“If I didn’t get it, I’d kick a door in and break something or damage something – or someone.”
“You needed to send a message to get them to pay up” “I once locked someone in the boot of a car for nine hours and he didn’t even owe any money..... I was looking for his brother but I couldn’t get hold of him, so I got hold of his little brother instead.”

On one occasion an addict who owed money taunted his dealer in an SMS and needed to be sent a message. He was literally crucified with a nail gun used through both his hands pinning him to a tree. The total amount owed to the drug dealer - 15 pounds.....

In one instance a close relative of John's owed money;“I nearly killed him because he owed money,” John said. “I didn’t even think about it. When you’re on drugs you don’t think. And I had to do it otherwise I would have been filled in (beaten up).”John has since reformed. 

After spending time in and out of jail for numerous offences (drug supply, traffic offences, burglary) he spent one night in a maximum security prison. It was terrifying there were some big-arse people in there with forearms the size of my head. “It opened my eyes. I felt like I was a cockroach in a pride of lions. They could just step on me and I’d be dead.”

He met a girl who gave him an ultimatum of the drugs or her, he chose her. His past still haunts him with an employer terminating his role when finding out about his convictions.


This story was sourced from gethampshire.co.uk.



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