Posted: Mon Apr 02, 2007 5:49 pm
Extract from Credit Industry Article
Creditors and debt collection agencies have been warned that they need to have complaints-handling procedures in place in time to deal with new requirements under the Consumer Credit Act 2006.
Appropriate record-keeping administration systems must be designed and implemented, and staff must then be trained. Copies of the Financial Ombudsman Service leaflets must be obtained and notices prepared for places where the public have access. Professional indemnity insurance needs to be purchased.
From 6th April 2007 unsatisfied complainants can refer their complaints to the Financial Ombudsman Services, totally free of charge, and the FOS has the power to make awards of up to £100,000 if it finds in favour of the complainant. There is no downside for the complainant – if he loses it has cost nothing to use the service and he still has his normal legal remedies available should he wish to use them. For creditors and debt collection agencies, however, it is a different story. There is a charge to them for complainants using the FOS (£400) regardless of whether they win or loose, and any awards made against them are binding with no right of appeal.
The industry is concerned that this will lead to complaints against creditors and debt collectors for use of unfair and intimidating tactics against debtors and possible suspension of Consumer Credit Licences if complaints escalate.
Creditors and debt collection agencies have been warned that they need to have complaints-handling procedures in place in time to deal with new requirements under the Consumer Credit Act 2006.
Appropriate record-keeping administration systems must be designed and implemented, and staff must then be trained. Copies of the Financial Ombudsman Service leaflets must be obtained and notices prepared for places where the public have access. Professional indemnity insurance needs to be purchased.
From 6th April 2007 unsatisfied complainants can refer their complaints to the Financial Ombudsman Services, totally free of charge, and the FOS has the power to make awards of up to £100,000 if it finds in favour of the complainant. There is no downside for the complainant – if he loses it has cost nothing to use the service and he still has his normal legal remedies available should he wish to use them. For creditors and debt collection agencies, however, it is a different story. There is a charge to them for complainants using the FOS (£400) regardless of whether they win or loose, and any awards made against them are binding with no right of appeal.
The industry is concerned that this will lead to complaints against creditors and debt collectors for use of unfair and intimidating tactics against debtors and possible suspension of Consumer Credit Licences if complaints escalate.