The Office of Fair Trading (OFT) has reportedly threatened to fine credit card lender MBNA a total of £50,000 if the company fails to improve the way it deals with debtors in financial difficulties.
Following a thorough OFT investigation, it was revealed that the debt collection arm of MBNA was not always letting borrowers in financial difficulties know that the company would accept token payments.
It was also found that MBNA’s debt collection team was occasionally bypassing the debt charities and debt management firms appointed by customers’ as representatives. This is despite the fact that MBNA’s policy allows these representatives to handle enquiries on behalf of customers.
In order to avoid the £50,000 fine from the OFT, MBNA must agree to:
• Not to contact customers with appointed representatives unless permission is expressly given by the customer. However, the MBNA debt collection team can contact these customers if no payment has been made and a reasonable attempt has been made to contact the representative
• Make it clearer in letters to financially troubled customers that their token payments will be accepted
These changes to debt collection policy must be made by January 1st, 2011 if the credit card lender is to avoid a costly OFT reprimand.
Speaking of these changes, a spokesperson for MBNA confirmed:
“We have agreed to deliver greater transparency in some of the communications we have with our customers in financial difficulties.
“We believe these changes are enhancements to our existing strong practices; we are in the process of implementing them now.”
Another example of Street Thug tactics used by people who aren’t merely “too big to fail,” but “too big to be ethical and humane.”
Stop calling people “debtors” and begin calling them neighbors, friends, loved ones…and savor that possibility.