Why the activity of debt collectors is illegal?
The activity of debt collectors in the Republic of Moldova isn’t licensed. The companies working in this area base on the Civil Code and the so-called Code of the Collectors Ethics, which obviously has no legal force and doesn’t obligate any company to comply with it. This activity isn’t controlled by anyone.
In the article, published in October 2014 on the portal curaj.net «About debt collection companies», the author notes that the activity of such companies is one of the illegal forms of advocacy, but no one pays attention to this fact. According to the author, the majority of these companies illegally practice advocacy through their representatives.
These companies use advice for business issues in the main activity, sign so-called contracts of guaranty for the recovery/compensation of debts/receivables from various individuals and legal entities. But they actually practice a form of illegal advocacy.
In the article is mentioned about the activity of the company Pfb Legal Consulting, which is trying to repay the debt to Sun Communications.
Another article about debt collection was published in January 2014 in a newspaper Moldova Suverană «Bureau for the collection of debts». And this time the company Sun Communications was mentioned in it. The article states that one of the customers of Sun Communications has continued to receive bills even after he informed company about the termination of the contract.
He was surprised on receiving from legal debt collection company «Debit Grup» a letter of debt for Sun Communications - 36,29 lei.
«At first I was graciously gave to understand that if I repay the debt to the date of receipt of this letter or pay it within the next 10 days, nothing will happen with me. Later they began to threat me, said that the LLC (limited liability Company), the bureau for the collection of debts «Debit Grup» «will have to go to court». So I will be forced to pay huge sums: attorney's fee - 1200 lei and the fee of the bailiff - 1000 lei, court costs, fines, interest costs and other dirty things».
According to one of the employees of the Ministry of Justice – Vladislav Karlan, quoted in the article, published in the newspaper «Moldova Suverană», the debt collection companies are legal until they provide advice service, information, reception of complaints, but they have no right to represent anyone in court.
The employee also suggested that the managers and employees of debt collection companies are very well aware that they aren’t able to get debts from anyone legally.
They can do this only by breaking the law. Companies-collectors can’t make enforcement actions, including seizure. Only bailiffs can realize such functions, as well as representatives of tax inspections, customs and courts.
The protection of personal data
The distribution of personal data of clients is an illegal practice. The companies use it to increase the chances to collect the depts. According to the article posted on the website juridicum.md: «A debt collection and personal data protection», the company Unite forced a woman to pay the debt of 200 lei by notifying all the people from her contacts about her debt.
The author found out that the company used this method in the case of other persons, addressing to their relatives, friends and acquaintances and informing them about the debt. Thus, the company Unite and/or its representatives have violated the law on protection of personal data in the process of collecting of debts.
«Hello, I also have a debt from Moldtelecom in 2012, and now the company Incaso prosecuted me for six months and wrote in the social networks not only me, but for all possible friends, relatives, that is, of course, frustrating. In addition, I was invited to the court and to the amount of 500 lei there was added another 2 000…» (Tina 30.12.2014, curaj.net)
There are some provisions about personal data in the case of debt collection under the contract on rendering of mobile communication services «Unite»:
– «Any information provided by the Subscriber, will be used by the Operator only for purposes associated with the execution of this Agreement: payments, relations with customers, debt collection and others. Processing of Subscriber’s personal data is done by the Operator in accordance with law and this agreement». (Paragraph 5.7)
– «In case of default on payment of services and equipment, the Subscriber shall provide the Operator the right to transfer personal data to third parties in order to repay the debt, including the debt collection companies ». (Paragraph 6.2)
From the provisions about security policy regarding the processing of personal data in the framework of the S. A. «Moldtelecom» company (which includes Unite):
– «Transmission and processing of customers' personal data by debt collection companies is done in order to implement all steps necessary for recovery of receivables S. A. «Moldtelecom», together with appropriate penalties». (Paragraph 4.3)
– «S.A. «Moldtelecom» can share information about the identity of the subscribers and the amount of debt to collection companies in order to recover the receivables and to ensure fulfillment of obligations stipulated in the agreement». (Paragraph 7.7)
There is a negative Registry of borrowers – INFODEBIT in Moldova, also called a black list of borrowers.
mobile companies, micro-finance companies, banks, enterprises providing utility services, insurance companies, individuals and others have access to the data of the INFODEBIT Registry. They can check a potential consumer/client and define their own risk or to establish a contractual relationship with a trusted person. According to the data posted on the website curaj.net this database is illegal. The author argues that only state institutions have the right to create such a database.
How much is the repayment of a debt?
The percent for repayment of the debt depends on several criteria. However, companies are working with the principle «NO MONEY - NO FEE». There is no advance, money is given only after repayment of the debt. However, the creditor, not the debtor must pay this amount. But there are some companies that allocate this payment to the debtor.
Some of the provisions in the contract on rendering of mobile communication services «Unite»:
– «In case of nonpayment in time the value of the services and equipment obtained by the Subscriber, the Operator can pass his data to debt collection companies, and the Subscriber will be required to repay the debt and the company's fee. In the case of filing a lawsuit in the court, the Subscriber is obliged to pay the state tax, the charges for representation in court, tax and an advance by enforcement». (Paragraph 8.9)