One important area of focus is on the subject of Debtors receiving properly identifiable letters of release after paying a delinquent debt to a creditor or their agent. Currently, provincial regulations across Canada range from failing to require any documentation to prove the debt has been paid to failing to require documentation which is sufficient for updating personal credit reports.
ALBERTA FAIR TRADING ACT
Currently, the Collections And Debt Repayment Practices Regulation section of the Alberta Fair Trading Act – Section 21, subsection (1) states:
Every collection agency and debt repayment agency must acknowledge the receipt of all cash transactions made in person, or payments made at the debtor’s request that the collection agency or debt repayment agency or a collector, debt repayment agent or employee collects or receives from a debtor for distribution to the debtor’s creditors by means of receipts that meet the requirements of subsection (2).
Subsection (2) states:
The receipts referred to in subsection (1) must contain (a) the date the amount is collected or received, (b) the name of the debtor, (c) the name of the person for whom the collection agency or debt repayment agency acts, and (d) the amount received from the debtor.
BRITISH COLUMBIA, SASKATCHEWAN AND MANITOBA
The following provincial regulators all have similar shortcomings with regards to regulation that fails to understand how to integrate the rights of Canadian consumers with existing legislation:
- BPCPA’s Debt Collection/Debt Repayment regulation (B.C.)
- Financial and Consumer Affairs Authority’s Collection Agent’s Act (SK)
- Consumer Protection Office’s Collection Practices
THIS IS INSUFFICIENT !
Equifax Canada and TransUnion will both amend personal credit reports within 30 days of notification by the consumer using THIS FORM, as per the Access to Information Act and both are quite reliable in sending letters of confirmation to a consumer upon receipt of such a request provided proper verification is received. Proper verification procedure requires that the creditors original account number (or, for security purposes the last few digits) be prominently displayed on the receipt (i.e. Release Letter). In the case of updating a collection in the Public Record section of a consumer credit report, the agent’s reference number for credit reporting purposes much be prominently displayed on the receipt (i.e. Release Letter). Failure to clarify exactly which debt was paid by providing account and/or reference numbers on receipts may be interpreted as passive-aggressively continuing to attempt collection on an already paid debt by virtue of the debt continuing to be displayed on the consumer’s personal credit report as an unpaid debt. This weakens a consumer’s beacon score or prevents improvement of a weak beacon score which leads to an array of far-reaching issues such as inability to qualify for a new mortgage or excessively high home ownership costs due to interest rate increase by chartered banks at mortgage maturity or due to the need for alternate financing when criteria for approval by chartered banks are no longer met.
CCCM intends to add pressure to law makers, starting in the provinces mentioned above, so that provincial regulations can be updated to reflect the basic rights of consumers and to better align these provincial rules with the federal Access to Information Act.
This goal requires YOUR SUPPORT! We aren’t asking for money as we are not a business for profit. We ask you to simply comment on this blog and our Facebook page by adding your supportive messages. This will demonstrate to law makers that we are not alone in our drive for Canadian businesses in the credit industry to co-operate with consumers who pay their overdue debts after overcoming financial hardship and provide useful documentation that satisfies not only the creditor’s limited concept of how to close an account but the wider, more accurate fact that failure to revise policies as per our suggestion is abusive to consumers, a violation of the Access to Information Act and makes the creditor liable for damages in the event of a claim. People are waking up and are refusing to be damaged by failures to properly interpret simple laws therefore the provinces must align their rules with existing federal rules before things get complicated for businesses who offer or who collect credit debts.