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Government crackdown on unfair CCJs by rogue companies

16/01/2018 / Comments 0

Government crackdown on unfair CCJs by rogue companies

The government is cracking down on unfair County Court Judgments (CCJs) passed against individuals without their knowledge.

There has been a general increase in the number of CCJs issued to consumers over the last five years. In Q3 2017 consumer CCJs rose by 24% to 317,793 with an associated value of £467.9m.

But, alarmingly, in more than 80% of cases judgments are issued with no defence heard in court.

To limit the circumstances in which default judgments can be made against people without their knowledge, The Ministry of Justice has launched a consultation to seek formal evidence on the scale of the problem, and consider how best to protect consumers and businesses.

The proposals include:

Particular attention is being paid to rogue parking and utility firms who have been accused of abusing the CCJ system after concerns were raised that some companies were deliberately sending claims to consumers using incorrect addresses.

Justice Minister Dominic Raab said: “We want to protect vulnerable consumers from abuse by rogue companies that can destroy the credit rating of innocent people without them even knowing about it. Debts should be paid, not exploited by a minority of cowboys who need reining in.”

Safeguarding debtors from unfair practices

A CCJ is a judgment issued by the courts that orders a customer to settle a debt, all the relevant costs and interest within a certain time frame.

Once issued, if the amount owed is not paid within one month, the CCJ will be placed on their credit record for six years, making it harder for them to obtain credit in the future.

The government has already taken steps to put extra safeguards in place for debtors before a debt claim is issued.

The Pre-Action Protocol for Debt Claims was introduced on 1st October 2017 and encourages parties to communicate issues at an early stage and resolve the matter without the need to start court proceedings.

However, this does little to help victims of rogue companies who deliberately give courts incorrect addresses, so warnings and information about court dates are missed.

This deprives debtors the chance to defend the claim and means that they have to suffer the consequences of possible enforcement and the impact on their credit rating.


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The consultation points out that some individuals are unaware that a judgment has been made against them and don’t find out until months or years later that their credit score has been damaged.

By then they may have already had trouble obtaining approval for a mortgage, loan or a mobile phone contract due the CCJs effect on their credit rating

Currently, although claim forms are issued to defendants, there are no checks to make sure the papers have actually been received.

And, not receiving a claim because it was sent to an old address is not a defence and therefore an appeal would not be won on this basis.

The consultation proposes that anyone who has had a debt judgment passed against them without their knowledge will immediately have it struck from their record once unknown debts are resolved and a judge agrees that the person was unaware.

Ministers are also considering moves to make firms prove they have sent courts correct address details when making claims. 

This highlights the importance of creditors making sure that they keep records of all correspondence and remain in constant contact with debtors to make sure that they always have current and accurate addresses.

This can be achieved by improving your credit control processes to keep in touch with all customers throughout the credit period and keep chasing once a debt goes overdue.

The consultation also proposes introducing an information campaign with a centralised, trusted source to raise awareness and help people deal with unresolved debts.

The consultation on default County Court Judgments will close on 21st Feb 2018 with a response due to be published in May 2018. To find out more or to contribute to the consultation please click here.

What do you think about the proposals? Let us know your thoughts in the comments below.

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