Debt collection guideline: for collectors and creditors

5. Frequency of contact

  1. Debtors and third parties are entitled to be free from excessive communications from collectors.13 Communications must always be for a reasonable purpose, and should only occur to the extent necessary: see part 2, section 2, Contact for a reasonable purpose only. The guidance on frequency of communications should be read subject to this general principle.
  2. References to the number of contacts with debtors should be read as the number of contacts per account, rather than per individual debtor. It may be acceptable to have a higher overall level of contact with an individual debtor if this contact relates to more than one account. Where possible, however, collectors should seek to discuss multiple accounts with a debtor during the one contact to avoid unnecessary communications. Subject to your arrangements with original creditors, this includes where you collect debt on a contingent basis for multiple clients.
  3. Unnecessary or unduly frequent contacts may amount to undue harassment of a debtor. We recommend that you do not contact a debtor more than three times per week, or 10 times per month at most (when contact is actually made, as distinct from attempted contact) and only when it is necessary to do so.14 This recommendation does not apply to face-to-face contact which is specifically addressed below.
  4. Unreasonably frequent attempted contact may also amount to undue harassment. This may occur, for example, where an automated dialler is used to make calls and a debtor’s number is returned to the queue within a short space of time after each attempted contact. Collectors should ensure that attempted contacts are not excessive.

Example: Unnecessary repeated contacts

If you contact a debtor or other person multiple times a day, without allowing an appropriate interval for the debtor to respond, then this is likely to involve unreasonable contact and may amount to undue harassment. Such contact may arise, for example, from the use of an automatic dialler system which leaves messages on recording devices and continues to call the recipient repeatedly until a response is received or identification is confirmed.

Telephone and other contacts (including letters, emails, text or telephone messages, social media channels)

  1. Unnecessary or unreasonable contact by letter, email, SMS, telephone messages (whether left on a voicemail service, an answering machine or with a third party), or by the use of social media channels or other technology must also be avoided.

Example: Contact using social media

If you use social media such as Facebook to contact the debtor, then you must ensure such contact is not excessive and is always for a reasonable purpose; otherwise the contact may amount to undue harassment. You must also observe your privacy obligations when using such forums to make contact with the debtor.

  1. It is important to cease your efforts to contact the debtor once you have reached the above recommended limits or if it is evident that further contact would not be for a reasonable purpose, unless the debtor invites the contact or there is some other legitimate reason for making further contact (for example, if you are in the process of negotiating an agreement with a willing debtor). It is also important to cease your efforts to contact the debtor using a particular medium when the debtor has requested that this medium not be used and has provided you with an alternative method of contact.
  2. Once you have made contact, leave a reasonable interval before next contacting the debtor. Give the debtor time to respond to your previous communications, and/or to organise payments if this has been agreed.

Example: Repeated contact without interval

If you have spoken to the debtor and it is understood that the debtor requires a few days to speak to third parties or consider options, then contacting the debtor on the following day may be considered unreasonable, even though it is within the recommended limits.

Face-to-face contacts

  1. Further guidance is provided in part 2, section 7 on when face-to-face contact with the debtor is appropriate. You should only make face-to-face contact when such contact is necessary and reasonable. In such cases, we recommend that you do not make more than one face-to-face contact with a debtor per month (if contact with the debtor actually takes place).

CASE STUDY

The court ordered the defendant company to restrict its agents to a total of five personal visits (for the period of collection) unless a visit was specifically requested by the customer or a repayment agreement had been made and subsequently breached (in which case a further five visits could be made).

ACCC v Esanda Finance Corporation Ltd [2003] FCA 1225

Third parties

  1. We recommend that you do not contact a third party to obtain location information more often than once every six months. An exception is when permission to make further contact about the location of a debtor has been sought and given in advance by the third party. See part 2, section 8, Privacy obligations to the debtor and third parties and section 18, Conduct towards family members and other third parties.

Example: Frequency of third party contact

If you contact a third party in an attempt to speak with a debtor, and that other person tells you that the debtor does not live at that address and they do not know the location of the debtor, or have further details to provide, or simply do not wish to provide further details about the debtor, then you should not contact that third party again, unless you have reason to believe that after six months or more they may be in possession of relevant information about the debtor.

Undue harassment

  1. Unduly frequent contact designed to wear down or exhaust a debtor, or likely to have this effect, constitutes ‘undue harassment’ or coercion and must be avoided. This is particularly likely if the collector makes a number of phone calls or other contacts in rapid succession. See part 3, Commonwealth consumer protection laws.

13 In Victoria, s. 45(2)(m) of the Australian Consumer Law and Fair Trading Act 2012 (Vic) provides specific protection to debtors. Subsection (m) specifically prohibits a collector from contacting a debtor if the debtor has requested in writing that no further communication should be made.

14 Note that s. 31(2) of the Property Agents and Motor Dealers (Commercial Agency Practice Code of Conduct) Regulation 2001 (Qld) (which is specific to commercial agents) prohibits unsolicited communication with customer, including a debtor, more than twice a week.

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