Fair Debt Collection: What Albertans Need To Know

As an insolvency / bankruptcy trustee with offices in Calgary and Edmonton, Alberta, many of our clients have asked us about their rights related to debt collection. Here are the basics of what you need to know:

What is a Collection?

A collection is an action taken by a debt collector to recover money owed to a creditor, whether it is past due or has not been paid at all. Creditors often employ collections agencies and other businesses to recover payments from delinquent accounts and assets.

The Alberta Government has taken steps to protect consumers from aggressive collectors by requiring all collection agencies, collectors, and debt repayment agencies to be licensed.

Under the Consumer Protection Act, a collector may:

• Contact you at home between 7 a.m. and 10 p.m. Alberta time.

• Contact your spouse, adult interdependent partner, relative, neighbour, friend, or acquaintance to obtain your residential address, personal or employment telephone number.

• Contact you at work to discuss your debt unless you ask them not to. If you don’t want to be contacted at work, you must make other arrangements to discuss the debt and you must keep those arrangements.

• Contact your employer on one occasion to confirm your employment status, business title, and the address of the business in preparation for legal proceedings

A collector may not:

• Call you or members of your household, relatives, friends, neighbours, or your employer so often that the number of calls received could be considered harassment.

• Use threatening, profane, intimidating, or coercive language.

• Give any false or misleading information including references to the police or a law firm, credit history, court proceedings, lien, or garnishment or imply that the collector or agency is part of a law firm or legal department of the collection agency or client.

• Threaten or state an intention to proceed with any legal action where the agency does not have the legal authority and consent of the creditor to do so.

• Discuss your debt or the existence of your debt with any person except you (unless you have given your express consent to do so), a guarantor of the debt, the creditor or someone you have identified in writing as your representative. If you want the collector to contact your representative to discuss your debt, you must provide that person’s current address and telephone number.

• Discuss your debt with a minor child.

• Continue to contact you if you inform the agency in writing or any other verifiable means that the debt is in dispute and that you wish the creditor to take you to court.

• Continue to contact you if you tell the collector that you are not the debtor unless the agency is convinced you are the debtor after investigation.

If you are experiencing calls from collection agencies, it is important not to avoid the call. Avoiding the call will only lead to more calls. When discussing the debt with the collection agency, do no make promises that you cannot keep. If you are able to self-negotiate a settlement with the collection agency, get their agreement to the agreed upon settlement in writing before making any payments. If you are not able to make payments towards the debt, ask for some time to review your options and finances with your financial advisor and speak with a Licensed Insolvency Trustee about the options for dealing with the debt, such as a consumer proposal or a bankruptcy. Once a consumer proposal or a bankruptcy is filed, the collection calls must cease.

Fair debt collection practices are the rules that govern how creditors and collectors can interact with you. It’s important to know what your rights are when it comes to dealing with debt collectors.

For more visit https://open.alberta.ca/publications/c26p3