I can’t help but feel disappointment when I hear that FLAC are calling for banks to be highly limited in their ability to make unsolicited contact to resolve issues with debtors. This was widely reported (audio clip here), but doesn’t go on to state why it’s good, bad, or why it may need to be changed, the suggesting isn’t coming out of thin air.
Our thoughts are that pragmatism must win out, a level of limiting power along with a corresponding engagement and non- harassment policy is possible. Our submission to the Central Bank (below) attempts crudely to consider this.
The TD Stephen Donnelly reported in the Sunday Independent that he had constituents who were being harassed by the banks and that the use of auto-diallers was a part of that. This didn’t count as unsolicited contact because under the precise rules of the Code of Conduct on Mortgage Arrears calling a person then not leaving a message doesn’t count as ‘contact’.
At the same time it has been accepted by the Central Bank that the policy (as they are the ones who introduced it in s21 of CCMA 2010) of severely limiting contact can be a driver of further arrears, it is for their part – likely with some strong bank lobbying – that this will be repealed.
We went so far as to show people how to use the system against banks if they feel harassed and which makes the idea of over-calling a client backfire on the lender.
The Central Bank encourages the use of ‘best practice’ and in debt collection auto-diallers are seen as being ‘best practice’, but that doesn’t mean it’s best for the borrower. This is why we started our CCMA submission calling for an end to their use, increased contact – but only from humans to other humans is a better starting point.
If non-contact can deepen arrears then it can’t be held as an automatically good thing because of a pre-disposition whereby there is an assumed correlation between getting a phone call and ‘being harassed’, harassment requires some form of qualification and can be subjective. This lack of qualification, or expansion on how non-contact will remedy a persons arrears means that Free Legal Advice may not be opting for the best solution for both parties, rather they are just towing a debtor lobbyist line of thought.
There are no sanctions we are aware of against any financial institutions for harassment calls or cases where this is the central complaint. This practice is not seen as ‘best practice’ anywhere but here, far better is some other kind of workable solution that gives room to either side to engage with some limiting factors so that people are called at appropriate times or where additional contact is only available when there is reduced or absent engagement.
We would make the following suggestions.
1) That the use of ‘auto-diallers’ is removed, while at the same time the restriction on unsolicited contact is changed. Contact must be appropriate and not excessive as per s21 CCMA 2010 and proposed s20 CCMA 2013, however, when there is no answer or message left an auto-dialler can create excessive ‘attempted contact’ which may not be appropriate. The best solution is to allow people to call other people more often and to apply the record keeping requirements as per existing CPC of these attempts.
2) That contact be restricted slightly from the s. 46 of the CCA 1995 times. Contact is not appropriate up to 9pm for people with young families, 7pm is a more appropriate hour, and Saturday’s should be restricted unless there are two failed weekday attempts of contact.
The remedy in this instance could be that in order to contact people with young families after 7pm there should be express permission during a contact when they don’t have time to speak, or by prior arrangement, or where there are two failed attempts at contact prior to this. The removal of three unsolicited contacts (as per s21 CCMA 2010) will assist both lender and borrower in the resolution process but it should come with some concession recognising that a person has rights to private time free of molestation from creditors. The CCA 1995 guidelines warrant review when applied to mortgage arrears and a new set could be applied when the contact is specific to this area.
It would also help to have a ‘contacts policy’ as suggested in the review, to have a prominent position on a lenders website.