I wish to inform the Deputy that I have no responsibility for the regulation of debt collectors and debt collecting firms. Debt collection services apply across a significantly wider range of activities than the recovery of money by financial institutions, for example for the non payment of utilities, rents, hospital charges, college fees, other consumer debts and also debts between businesses.
The Minister for Justice and Equality is responsible for legislation - the Non-Fatal Offences against the Person Act 1997 - which applies to all debt collectors that operate across any or all sectors of the economy, including private individuals and debt collecting firms.
Under section 11 of this Act, it is an offence to demand payment of a debt in a way that is designed to cause alarm, distress or humiliation. A person found guilty of offences under this Act is subject to large fines and up to 14 years imprisonment.
The Central Bank has informed me that there is no Consumer Protection Code applying specifically to debt collection firms. However, the Deputy might wish to note that, in the case of financial institutions which use debt collection firms, the Central Bank has imposed requirements that offer protection to consumers under the revised Consumer Protection Code. The Code obliges the regulated financial institutions that it covers to ensure that any outsources activity, such as debt collection, complies with the requirements of the Code. This means that outsourced activity should uphold principles in the Code such as the requirement for financial institutions: -
- Not to exert undue pressure or undue influence on a customer,
- To act honestly, fairly and professionally in the best interests of customers and to act with due skill, care and diligence in the best interest of its customers and
- To prohibit personal visits or oral communications except in specified circumstances.
The Consumer Protection Code for Licensed Moneylenders also contains some requirements in this regard. Where a moneylender engages the services of a third party to collect debts on its behalf, the moneylender must have in place a written contractual arrangement which seeks to ensure that consumers are treated in accordance with the provisions of this Code and the relevant provisions of the Act. A moneylender must inform an affected consumer that his/her moneylending agreement has been assigned to a third party as soon as practicable after assigning the moneylending agreement. This requirement does not apply where the moneylender, by agreement with the third party, continues to service the moneylending agreement vis-a-vis the consumer.
The Deputy may wish to know that the Consumer Protection Code 2012 is issued pursuant to powers under the following legislation:-
Section 117 of the Central Bank Act 1989
Section 23 and section 37 of the Investment Intermediaries Act 1995
Section 8H of the Consumer Act 1995 and
Section 61 of the Insurance Act 1989
The Central Bank has power to administer sanctions for a contravention of this Code, under Part 111C of the Central Bank Act 1942.
