The Australian Competition and Consumer Commission (ACCC) and the Australian Securities and Investments Commission (ASIC) today issued a brochure outlining their roles in regulating debt collection activities.
Both ASIC and the ACCC oversee laws which protect consumers from inappropriate behaviour by a debt collector.*
'Debt collection is a legitimate and necessary business activity, but debt collectors are not able to pursue debts by any means', ASIC's Executive Director Consumer Protection and International Relations, Mr Greg Tanzer, said today.
'Debt collectors must not use physical force, undue harassment or coercion when collecting debts. They must also ensure that their conduct does not mislead or deceive consumers or take unconscionable advantage of them', Mr Tanzer said.
'If consumers have concerns about debt collection practices, the joint ASIC-ACCC brochure will assist consumers and persons acting on their behalf to take those complaints further', ACCC Deputy Chair, Ms Louise Sylvan, said.
The new brochure sets out the role of each agency in debt collection:
- ASIC deals with debt collection complaints relating to a financial service. This includes debts on credit card accounts, personal or home loans, finance provided by a finance company for items such as a car or household goods, as well as fees for the provision of financial advice;
- the ACCC deals with debt collection complaints relating to goods and non-financial services. This includes debts for telephone services or other utilities, and for the services of tradespeople and professionals, where immediate payment is not required.
The above arrangements also apply when a debt is 'assigned' or sold to a third party, such as a debt buy-out company.
'Consumers can contact either agency if they are not sure, as staff of both agencies will ensure the complaint is directed to the right place', Ms Sylvan said.
She noted that with increasing levels of personal and household debt, the brochure and the agreement between ASIC and the ACCC represents a strong signal that unlawful debt collection practices will not escape the attention of Commonwealth consumer protection agencies.
ASIC and the ACCC will also issue a revised version of the ACCC's Debt Collection Guidelines in early 2005. The revised guide will reflect market developments and recent court decisions.
To obtain a copy of the brochure or to lodge a complaint, contact the ACCC on 1300 302 502 or ASIC on 1300 300 630. The brochure will also be available on the ACCC website at www.accc.gov.au and the ASIC website at www.asic.gov.au.
* Trade Practices Act 1974 and Australian Securities and Investments Commission Act 2001
** In addition to ASIC and the ACCC, complaints regarding debt collection can also be lodged with state or territory government consumer affairs or fair trading agencies, or an industry dispute resolution scheme (for example, the Banking and Financial Services Ombudsman, or the Telecommunications Industry Ombudsman if the debt collector is a member of these schemes).
End of release