OFT to Update Debt Collection Guidance

The Office of Fair Trading has recently confirmed that it will be looking to update its debt collection guidance later this year. Speaking at the Managing Consumer Debt conference, David Phillpot from the Office of Fair Trading confirmed that plans are underway to update the guidance of the debt collection industry later this year.

The reasons behind the update is to take account of debt purchasing guidelines and the best practice over collections management.

The debt collection sector has some pressing issues to face following accusations of consumer claims that some companies chased the wrong individuals, refused to investigate disputed debts and bypassed third party representatives, such as debt management companies. Obviously, a lot of accusations are unfounded and tend to originate from serial debtors who simply will try to find an excuse to not pay their bills.

The Office of Fair Trading claim that these problems will be dealt with and that it would communicate with debt collection agencies through credit trade associations to ensure that all debt recovery agencies received the updated guidelines.

Mr Philpott denied that the new guidelines would create unnecessary burdens on the debt collection sector, adding: “We will take effective action against businesses that harm or may harm consumers but we also want to establish close links with businesses and consumer representatives to ensure constructive dialogue.”