18 Nov 2020

How to make a complaint about a debt collection agency

If you have concerns about how you have been treated by your lender, or a debt collection agency that they have appointed, it is important to know how to approach complaining about them, who to speak to about your complaint and how you can expect this to be handled.

The consumer credit lending industry is governed by very strict rules issued by their regulator, the Financial Conduct Authority (often abbreviated to “FCA”). The FCA’s primary focus is to make sure that consumers are treated fairly by the big credit lending organisations. For this reason, they have a lot of rules about what lenders must do if you make a complaint and how they are expected to resolve any issues between you and the debt collection agency involved.

If you believe that your lender has not treated you fairly and would like help with making your complaint, CLB is here to help you defend your rights and get the outcome you deserve. We’re all about helping people in debt with practical guidance advice.

How to complain about debt collection agencies

You do not need a lawyer to stop repossession, although it would be a very good idea to take as much advice as possible before taking any action.

When you make a complaint to any financial institution, there are strict processes they must follow and deadlines they must meet. Understanding what these are and what you can do if any company breaks these rules is important if you are going to get the outcome you deserve.

Many companies do not have online systems which you can use to raise your complaint. However, lenders and debt collection agencies must have their own straightforward guides to their complaints processes. You can ask for a copy of their complaint policy free of charge at any time.

Speaking to debt collectors may sound daunting, but if you want your complaint dealt with quickly, the best place to start is by speaking with them directly about your worries. If the debt collector is acting on behalf of your lender, you may also want to complain to your lender directly, as they will hold the debt collection agency to account.

The FCA makes sure that all firms will treat you fairly and with respect when you contact them. If they don’t, hang up and add that treatment to your complaint.

It can be tempting to make a complaint in order to force your lender to pay compensation or accept your point of view, but it is very important to make sure you are only complaining if you have a strong basis for your complaint.

Although the process may differ slightly from one company to another, the FCA sets out that most complaints must follow this process:

  1. The lender must send an acknowledgement of your complaint when they receive it. This will also set out the company’s timescales for dealing with complaints. You should take note of these and make sure they are met.
  2. After 8 weeks, the company must send you their final response to the complaint. This will tell you whether they:

(a) uphold your complaint and what they will do to put this right;

(b) not uphold your complaint and give you reasons why; or

(c) uphold some but not all of your complaints.

  1. If the company does not send your final response after 8 weeks, they must tell you why and when you can expect to receive this.
  2. You should acknowledge receipt of the final response and tell the company whether you accept their outcome or not.
  3. If you do not accept the outcome to your complaint, or if you have not received your final response after 8 weeks, you will then have the right to refer your complaint to the financial ombudsman. You must do this within 6 months of receiving the final response to your complaint.

The financial ombudsman is an independent and impartial publicly funded organisation which will look at all of the evidence in relation to your complaint and make a decision. If you do not refer your complaint to the ombudsman in time, the debt collection company or lender can ask the ombudsman to refuse to look at it.

The decisions of the financial ombudsman are binding on your lender, meaning if they find in your favour and/or award compensation, the lender must do what they are told. If you do not agree with the ombudsman’s decision, you are not bound by it and have the right to take your case to court or some alternative dispute resolution.

How to file a complaint against a debt collection agency

The first step in presenting your complaint is to set out your complaint to your lender. You should do this in as concise and simple a manner as possible. Stay away from extra detail or long reports of conversations or events.

This can be hard, particularly when you are upset or if the issue has caused a lot of distress. It is always a good idea to get a friend or family member who has no previous knowledge of your complaint to read it and tell you honestly if they think it is easy to understand.

On a practical note, never send your complaint outside the hours of 7am to 8pm. Complaints received late at night or early in the morning could influence the reader’s interpretation.

If possible, make sure your complaint is valid and supports your rights under the Consumer Credit Act, FCA Handbook and other consumer protection law. The internet can be a very useful source of information when you are making a complaint but it can equally be misleading.

Try to make sure that you are only using professional and reputable sources like government sites or professional companies (Step Change and Citizen’s Advice are great places for information). Steer clear of user-based forums sites which are set up to market other products or services (like comparison sites). Unfortunately, much of the advice on those sites is biased or just plain wrong.

Examples of complaints which you may have against your debt company include:

Excessive or unreasonable contact – this might be contact late at night or multiple calls, texts or letters in a short space of time.

Unfair or misleading behaviour – such as call centre agents or letters deliberately misleading you into thinking that the debt collector can take some action which they can’t (such as applying for a court order or repossessing your property).

Making charges in error – including applying too much interest or simply reporting the wrong balance.

It may be useful when forming your complaint to understand what rights debt collectors have.

Not helping you if you are in financial difficulty –  this would include if your circumstances change or if you are particularly vulnerable.

It is important that you do not include excessive evidence in support of your complaint and only attach documents which are essential to make sure that the lender understands your initial complaint. Debt collectors will have detailed and complete records of all of your dealings with them, including phone recordings. In most cases, you will not need to prove that you are being truthful. They will have this evidence themselves.

Remember that your complaint to the lender is the first step in the complaints process. If the company does not agree with you, you will have other opportunities to raise your points and add to your argument. A detailed account may be useful later in the complaints process, but you will have the best result of resolving your complaint quickly and to your satisfaction if you keep the first complaint short, sharp and to the point.

It may help to keep in mind that if it becomes necessary to refer your complaint to the financial ombudsman, you do not want to make their life difficult by giving them lots of documents and information to look through.

How CLB can help

CLB are here to help if you feel like you have been treated unfairly by a debt collector and want help making a claim against them. We are experts in consumer credit and are always happy to give you practical help and advice about how to make sure your rights are protected. If you have been the victim of irresponsible lending practices, we will ensure that you don’t pay your creditors a penny more than you have to.

To find out more about your rights when dealing with debt collectors or any of our services, you can contact us by phone on 0330 124 4252 or email us at hello@clbdirect.co.uk.