SINGAPORE — Debt collectors who wave their fists, threaten physical harm or post notices containing debtors’ personal information can be jailed and fined under new regulations.
The Debt Collections Bill, which passed parliament on Tuesday, will regulate the debt collection industry with the aim of preventing problematic debt collection practices.
Minister of State for Home Affairs Sun Xueling said the number of police reports against the conduct of debt collectors and debt collectors remained high – an average of 367 reports per year from 2018 to 2018. last year.
She spoke of two debt collection cases that have alarmed the public.
The first, in 2019, involved a debt collector who wore traditional funeral attire at the debtor’s workplace while carrying a banner with the debtor’s face.
The second, in 2016, involved six debt collectors who harassed a food stall in Funan Mall and damaged equipment at the stall.
The debt collectors in both cases were taken to task and sentenced under the applicable laws.
Ms Sun said debt collection is a legitimate economic activity that makes it easier to meet financial obligations, but more could be done to regulate the business.
“Individuals and businesses should not be subjected to debt collection methods that clearly exceed what can be considered reasonable pressure for payment, especially if those methods also affect the public’s sense of security,” a- she declared.
The bill will regulate the industry, targeting in particular entities that collect a debtor’s debt either on behalf of another person or where the companies themselves have acquired the debt, and their collectors.
Ms. Sun said the business models of these entities lend themselves to higher public order risks.
Under this scheme, all such debt collection firms, including their principal retainers and debt collectors, will be vetted by the police and must be found “fit and proper” before obtaining a license or approval. .
Those who engage in behavior that threatens the physical safety of the debtor, such as sending messages threatening physical harm, can be jailed for up to a year and fined up to $10,000.
The maximum penalties are doubled for repeat offenders.
Already regulated businesses, such as licensed pawnbrokers and banks, pose a lower risk to law and order, Ms Sun said.
But they will also be subject to a class licensing regime that does not involve police vetting to determine if they are “fit and proper”.