By Marcus Leach

The Office of Fair Trading (OFT) has published its updated Debt Collection Guidance which sets out the standards expected of all businesses engaging in the recovery of consumer credit debts, including banks, law firms and tracing agents as well as traditional debt collectors.

It also sets out specific business practices that the OFT considers to be unfair or improper, such as using Facebook and Twitter and other social networking sites to contact debtors, as well as contacting debtors at unreasonable times, or at inappropriate locations, for example when they are a patient in hospital.

More generally, the guidance:

- warns against misuse of continuous payment authority to recover debts, such as making recurring attempts to recover a single repayment.
- highlights the responsibilities of all parties involved in the debt recovery process, including creditors, for the quality and level of information they maintain and exchange with others, in order to avoid the wrong person being pursued for a debt.
- provides greater clarity on the OFT's position on issues such as reasonably queried and disputed debt and statute barred debt.
- makes debt recovery businesses aware that they should adopt appropriate practices and procedures for dealing with particularly vulnerable debtors.

"In the present economic climate, with many people, including those who may be particularly vulnerable, in financial difficulties, it is crucial they are treated fairly by companies recovering their debts," David Fisher, the OFT's Director of Consumer Credit, said.

"This updated guidance makes clear the standards the OFT expects of all businesses involved in debt recovery, including debt collectors, banks and law firms."

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