Oct. 20, 2009
FREDERICTON (CNB) - The New Brunswick government has made changes to regulations under the Collection Agencies Act to better protect New Brunswickers who are in financial difficulty.
"These changes will harmonize our regulations with those in other provinces and clearly outline the responsibilities of collection agencies when contacting New Brunswickers who are struggling to meet their financial obligations," said Justice and Consumer Affairs Minister Michael Murphy. "It is important to note that, unlike other provinces, New Brunswick still prohibits agencies from calling a debtor at the debtor's place of employment unless given direct permission from the individual."
The changes include several new restrictions on collection agencies. Agencies must immediately identify themselves when speaking with a debtor, make all reasonable attempts to provide written notice of a debt before attempting to collect, and ensure that they do not misrepresent or threaten court action.
The changes also allow collectors and agencies to contact a debtor's home from 7 a.m. until 9 p.m., compared to the previous timeframe of 9 a.m. to 9 p.m. Agencies may also now contact New Brunswickers on Sundays between 1 p.m. and 5 p.m.
Murphy said that these new timeframes are consistent with those used in other provinces.
Existing protections remain in place, but are more in line with the practices of other provinces as government works to streamline and simplify regulatory processes as part of its self-sufficiency agenda.
Collection agencies are still prohibited from contacting a debtor on a holiday, or contacting a debtor's friends, co-workers, neighbours or family members without permission. The regulations also allow New Brunswickers to tell agencies whether they prefer to be contacted by telephone or by mail.
"Although New Brunswickers have a responsibility to pay their bills, those who fall behind should not have to worry about receiving phone calls at their place of work, or be concerned that their family members or friends will be contacted by collection agencies," said Murphy. "Through these changes, clients of collection agencies will be more informed of their responsibilities and rights."
The changes to the regulations take effect today.
EDITOR'S NOTE: Following is a backgrounder about changes being made to regulations under the Collection Agencies Act. MEDIA CONTACT: Sarah Ketcheson, communications, Department of Justice and Consumer Affairs, 506-444-5816.
Changes being made to regulations under the Collection Agencies Act
How many collection agencies operate in New Brunswick?
There are roughly 60 agencies and 4,000 collectors licensed in New Brunswick.
Why are changes being made to the regulations? Were consumers previously protected?
The provincial government previously developed protections for individuals struggling financially and dealing with collection agencies. Those protections remain in place. However, the new regulations simplify the language and puts New Brunswick more in line with the rest of the country. Several additional protections were added.
When and where are agencies and collectors allowed to contact debtors?
Agencies and collectors can call debtors between 7 a.m. and 9 p.m, except on Sundays when they can only call between 1 p.m. and 5 p.m. Unlike other provinces, New Brunswick does not allow agencies or collectors to contact individuals at work without permission.
Who was consulted prior to these changes?
The provincial government consulted with the collections industry and other stakeholders before moving forward with these changes. Again, these changes harmonize New Brunswick's regulations with those in other provinces.
What process does an agency have to follow before trying to collect a debt?
Agencies must provide, or make all reasonable attempts to provide, written notice that it has been authorized to collect a debt. The notice must include the name of the agency, the name of the creditor and the balance owing on the account. Collectors must include their name as well as the name of the agency for which they are working and proof of authorization. They must wait five days after the notice has been mailed before attempting to make personal contact with a debtor.
What is considered unacceptable behaviour on the part of an agency?
Agencies must not use undue, excessive or unreasonable pressure on a debtor, including, but not limited to, profane, intimidating or coercive language, or making public, or threatening to make public, an individual's debt.
Can agencies collect debts through a person's wages?
What should debtors do if they feel a collection agency is harassing them or using threatening
New Brunswickers concerned about the actions of an agency may contact Consumer Affairs, which will then contact the agency in question to advise it of the complaint. If the investigation determines that an agency's practices contravene the regulation, a letter will also be sent to that agency advising it to cease the questionable practice. Collectors risk losing their licence if they refuse to follow regulations.
Do employees undergo background checks?
All agencies and collectors working in New Brunswick must be licensed. As part of that process, all potential employees must undergo a criminal background check.