Regulator concerned about debt collection agency
Updated: Mar 4, 2022
A recent article in The Australian Business Review has again highlighted the lengths some organisations will go to recover their debts with the Australian Securities and Investment Commission (ASIC) putting a large debt collection agency under the spotlight.
In the Federal Court, ASIC has alleged that the debt collection agency in question sent text messages and emails to 6 separate debtors which made false and coercive threats including threatening to imprison debtors and that their family, friends work colleagues and landlords would be contacted if the debtor failed to contact the company. In a call recording heard by the Court it is alleged that 1 debtor was told, "If they feel that you had the means to pay your debt agreement, if you made purchases at McDonald’s, if you made pointless purchases, you know things you don’t need, you can potentially be sent to prison." In a statement to the media, ASIC deputy chair Sarah Court said, "The conduct of debt collection agencies and participants in the debt collection industry is something ASIC is always concerned about. Companies have a right to recover debt. There are a range of legal protections around debtors who have entered into agreements."
At LCollect we do not condone this behaviour by anyone in our industry and actively work within the guidelines set by ASIC under Regulatory Guide 96 Debt Collection Guideline: For Collectors and Creditors. We also review our processes and procedures regularly to ensure continued compliance and are always looking at areas where we can improve.
The conduct of debt collection agencies and participants in the debt collection industry is something ASIC is always concerned about. Companies have a right to recover debt. There are a range of legal protections around debtors who have entered into agreements.
If you would like to discuss with us your debt collection requirements and how we encourage open and free communication, contact us online or speak with us on (02) 8923-1600 today.
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