- 29
- May
The number of county court judgments against debtors increased from 802,886 in 2005 to 1,022,166 in 2006, up 27 per cent. Recent figures reveal that individual debt rose to an incredible £1,310 billion in 2006 from £116 billion in 2005.
Court contractors who sell debtor’s information, and financial institutions who sell off bad debts compound this problem. Unfortunately, bad debt consolidation management has become a multi-billion pound industry.
EuroDebt, a questionable debt collection company, has a turnover of £13million. This company was subject of a BBC TV investigation, which filmed its agents charging customers thousands of pounds and implying they could get their debts reduced or even written off.
A reporter for the Inside Out programme posed as a client with debts of £17,000. A EuroDebt agent suggested he use his credit card to pay the company’s handling fee of £1,595, something independent debt counsellors consider “appalling and unethical”.
EuroDebt director Kevin Still said: “Under no circumstances would we recommend that anyone take out any additional credit.
“But it wouldn’t be unusual [to ask for postdated cheques] if somebody couldn’t afford to pay the instruction fee in one go, and we do allow a reasonable amount of flexibility in how they go about paying their plans.”
A spokesman for Information Commissioner Richard Thomas, who enforces data protection laws, said: “We will study The Mail on Sunday’s report carefully to consider if there is a case for tighter controls on those who have access to this data.”
Until recently the media only focused on the IVA industry as a whole. Now, they are targeting any company that victimises people who have borrowed too much on personal loans or mortgages.
