Background - What is Debtor Harassment?

If you owe someone money you are a debtor. If you get behind in your loan repayments, fail to pay a bill, or owe someone money, chances are somebody will contact you to request payment. You may be contacted by:

• the person or company you owe money to ( the creditor) or their solicitor; or
• a debt collector or their solicitor. Debt collectors sometimes “buy” the debt from the creditor. This is known as an assignment of the debt. If this occurs the money is owed to the debt collector.

A creditor or debt collector can approach you for payment of a debt you owe. This means they can:

• Ring you a reasonable amount of times per week requesting payment of the debt (reasonable would probably be no more than 3 times a week, depending on the circumstances)
• Visit you at home requesting payment of the debt (subject to a reasonable amount of visits per week)
• State that legal action may be taken against you to recover the debt
• State that a listing may be made on your credit report

If you are contacted by a creditor or a debt collector DON'T PANIC! For some information about your options see Fact Sheet: Dealing with Debt Collection .

Sometimes creditors/debt collectors go beyond what they are legally allowed to do in demanding payment for the debt. This is called debtor harassment.

This fact sheet is about debtor harassment only.

What a creditor can't do

If someone says that you owe them money, they cannot:

• Have you sent to gaol and cannot threaten to send you to gaol
• Threaten you with harm
• Threaten to tell your employer, neighbours or family about your indebtedness
• Take and sell (or threaten to take and sell) any of your property over which they do not have a mortgage or other form of security unless they have an order from the Court
• Threaten to garnishee (take) money from your wages without a court order
• Ring you very frequently (say four times per week or more without good reason) or ring you at unreasonable times such as very early in the morning (before 7am) and/or very late at night (after 8pm)
• Visit or ring you at your place of work
• Send you letters that look like court documents (but are not court documents)
• Use abusive or threatening language

What you can do if you are being harassed over a debt?

• Keep written records and copies of documents.
• Every time debt collector contacts you write down the time, date, what was said and the name of the person you talked to.
• Get advice or assistance. You should contact either a financial counsellor or a community legal centre to see if they can assist you. A financial counsellor may be able to assist you work out ways to repay the debt. A legal centre may be able to assist you with writing to the creditor or making a complaint to a consumer protection agency or the police. (See Getting Help )
• Write to the debt collector. You should write to the debt collector and ask them to stop harassing you. In the letter you should say that unless the harassment stops you will make a complaint to either the police or a consumer protection agency.
  See Sample Letter - Debtor Harassment . Keep a dated copy of your letter and any reply.
• Make a complaint to a consumer protection agency
  If you are being harassed there are government agencies (both State and Commonwealth) where you can lodge a complaint about the conduct of the debt collector. Please note that this does not mean that you do not have to pay the money. If you dispute the debt, get legal advice - see Getting Help .

1. Australian Securities and Investments Commission (ASIC)
   ASIC (since 11/3/02) has national responsibility for debtor harassment relating to credit (credit being loans of all types to consumers). If you are being harassed about repayment of a loan, you should make a complaint to ASIC.
2. The Australian Competition and Consumer Commission (ACCC)
   If the debt in question was not a loan (for example, an unpaid phone bill) you can make a complaint to the ACCC.
3. Office of Fair Trading (NSW)
   You also have the option of complaining to the Office of Fair Trading (“OFT”). OFT has State responsibility for debt collection practices pursuant to the Fair Trading Act (NSW). Section 55 of the Fair Trading Act prohibits the use of harassment or coercion in the collection of debts. A complaint about debtor harassment can be made to OFT for all kinds of debt.
4. The NSW Police
   If you have been physically assaulted or verbally abused or harassed or intimidated by a person seeking to recover a debt you should report the incident to the police. The police may charge the person or assist you to take out an apprehended violence order (AVO) against the person.

In NSW most debt collection companies are licensed commercial agents. Some forms of harassment and other criminal offences may be relevant to revoking or refusing to renew a debt collector's license.

The police are notified when an application is made to the Local Court for a license. The Police can object to the granting of the licence. An objection can be on the basis that a person is:

• not of good fame or character; or
• is not a fit and proper person to hold a licence; or
• has been disqualified under the Commercial Agents and Private Inquiry Agents Act from holding a licence; or
• has been convicted of an offence punishable by indictment.

If an objection is made, then the licence application is listed for hearing at court.