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Financial Services Regulation

Dáil Éireann Debate, Wednesday - 16 May 2012

Wednesday, 16 May 2012

Ceisteanna (89)

Martin Ferris

Ceist:

87 Deputy Martin Ferris asked the Minister for Finance if he will undertake to legislate in the area of debt collection in line with the Fine Gael Private Members ’ motion of 30 March 2009, which inter alia pointed out that unlike many other EU countries, Ireland has no system of regulation of debt collectors and called on the then Government to introduce legislation to regulate debt collection and to ensure that debt collectors are registered and vetted; and if he will make a statement on the matter. [24590/12]

Amharc ar fhreagra

Freagraí scríofa

I, as Minister for Finance, have no statutory function in relation to the issue raised by the Deputy. Debt collection services apply across a significantly wider range of activities than the recovery of money for financial products, for example for utilities, 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 collection agencies.

Under Section 11 of this Act, it is an offence to demand payment of a debt in a way designed to alarm, distress or humiliate. If someone is charged with this offence and it is tried as a summary offence the maximum penalty is €1,270 and/or 12 months imprisonment. If someone is charged with this offence and it is tried as an indictable offence, the maximum penalty is a fine and/or 14 years imprisonment.

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 its revised Consumer Protection Code (CPC). The Code obliges the regulated entities that it covers to ensure that any outsourced activity complies with the requirements of the Code. This means that outsourced activity should uphold principles in the Code such as the requirement for 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.

Similarly, there are provisions in the Central Bank's Consumer Protection Code for Licensed Moneylenders which provide protections to consumers in relation to the debt collection activities of licensed moneylenders, including where they outsource this function to a third party.

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