Worrying trend in debt recovery tactics

Acting on behalf corporates, debt collection agencies are riding roughshod over the law, resorting to strong arm tactics of illegal loan sharks.

COMMENT

What are your rights as a consumer when you are hounded by debt collection agencies appointed by those you owe money to or made purchases from? There have been numerous cases of victimisation by illegal money lenders or better known as ‘ah longs’.

We see them soliciting business by pasting stickers at any available location as though they are above the authorities. At least that is the perception. There are laws that govern advertising but it seems like these breed of ‘businessmen’ are above the radar or are ‘protected’.

But what’s of concern these days is the recognised debt collection agencies or companies. They are registered with the Companies Commission of Malaysia and are legal entities. Under the guise of acting on behalf of principle companies, they have grown bold and employ the modus operandi of ‘ah longs’.

They intimidate, harass, threaten and belittle those with outstanding financial issues with the lender/creditor or principle. Having obtained their personal data from the principle that hired them to execute collection, many take a high-handed approach to get customers/debtors/borrowers to pay up.

They drop big names of the principle companies and conduct themselves as if they have now ‘bought’ over the liabilities, thus giving them the absolute right to harass the debtor.

It is amazing to witness how big and well known firms have ‘outsourced’ the thuggery of debt collection to third parties who are not legal firms per se without much thought to the safety of the debtors. All the principles care about is getting their dues paid at whatever cost.

They seem oblivious to the manner in which the outsourced party institutes action to make the collections. As for the debt collection agencies, they live on the commissions based on collections made on behalf of the principles.

And when debtors resort to the police, they are given the run around as the police deems it a civil matter and until an actual crime happens, they are helpless. Complainants are shoved to the magistrates court to get further instructions. This just does not make any sense to the layman. How many have been denied justice is yet to be documented.

Why is an aggrieved party being given the runaround? Is the police implying that since the complainant owes money to the principle, he or she is not entitled to protection under the law? It is not the job of the police to play judge or mediator. They are appointed to uphold and enforce the law.

It is not about the money owed, as there is a contract between the creditor and the debtor or the purchaser but it is an issue of violating the rights of a person.

One should not be discriminated based on the civil issue but dealt from the perspective of criminality attached to the intention of the principle and the debt collection agency.

Is the PDPA powerless?

How does the Personal Data Protection Act 2010 (PDPA) protect the basic rights of consumers then?

We have situations where banks, retailers and many other business providers collecting personal data of their clients or customers. Under the Act, the data cannot be revealed to a third party unless explicitly authorised by the consumer or client.

The data collected is only to be used by the party collecting the information to provide services such as required by the customer. But what happens when they abuse the data and reveal sensitive information to a third party, like a debt collection agency? Is the PDPA that powerless? If so, why the big brouhaha over the Act?

We must remember that the aggrieved party did not enter into a contract with the debt collection agency. The principle can act on the debtor or those who have faulted on payments only via legal avenues and that too in writing, not by ‘outsourcing’ collections to ‘ah long’ like companies.

By all means exhaust your legal avenues as then the aggrieved party can also engage legal advise. On the contrary a debtor cannot do much when approached by these agencies that behave more like legal ‘gangsters’.

They have no authority to harass, intimidate and threaten the customer by implying that they have obtained blessings from their paymasters. No entity is above the law of the country. What have the vast number of consumer groups got to say about these issues?

Can Suhakam play an active role in recommending the government and its agencies or departments to protect the basic rights of those being suppressed under such circumstances?

Can the public go to the Public Complaints Bureau with their grouses when police refuses to take appropriate action and classify such complaints as “non-arrestable and no further action”?

It is despicable that renowned corporates apply such high handed tactics and solicit services of ‘legal ah longs’. There are many parties that have turned a blind eye to the woes of the public in such a predicament.

The Bar Council, which advocates equality for all, plays dumb when such cases surfaces but is super swift to jump on to the bandwagon the moment a politician is concerned. It rides on issues that bring publicity it but not defend the silent voices. Defining their inaction as hypocrisy will not suffice.