Dozens of Debt Letters Across the United Kingdom sent to wrong Locations

FRIDAY, NOVEMBER 17, 2006

Imagine the shock of getting a 4 figure debt repayment letter for a purchase you did not make. That is how Desmond Phillips felt when he received a letter demanding the repayment of a £575 loan he never took out.

The letter was actually meant to be for a Daniel Phillips, and in the days following this reporting, multiple other residents in the United Kingdom area received erroneous debt letters.

When Desmond contacted the company who sent the letter, JB Debt Recovery, everything became clear.

"I wondered what was going on. I phoned them and said 'look this isn't me - I'm not Daniel Phillips, I'm Desmond Phillips. They said 'don't worry about it, just forget the letter'," he told BBC Radio 4's Money Box.

JB Debt Recovery told Desmond Phillips that they would not contact him again and that they got his personal information to send the letter from service known as Equifax Locate.

There are three major companies, including Equifax, that have the credit history information of millions of UK residents. This information, along with that stored in other databases is used to track down those who may have taken out a loan and ran, with no intention of paying it back.

Neil Munroe, its external affairs director, said that Equifax only had a listing for Desmond Phillips, not Daniel Phillips, resulting in the mix-up.

"What we provided was that a Mr D Phillips with the same date of birth resided at that address. What we do say is it's Mr Desmond Phillips," Mr Munroe said. "JB Debt Recovery should have taken further steps to validate if it was worthwhile still contacting and sending any information to Mr Desmond Phillips's address," he added.

A few of Desmond’s friends and colleagues had also received wrong debt collection letter from different debt companies.

In some cases, like that of Penny English, the letter was sent to a person of the wrong gender.

"It was about £88 which was owed by Paul English to a water company," Penny said. I opened it as I was the only English in the household. I phoned up the debt collecting agency and said this wasn't the right person but they sent a second letter a couple of weeks later."

Essex and Suffolk Water, who were responsible for the letter, apologized to Penny for sending the debt letter to the wrong person.

Kurt Obermaier, an executive director of the Credit Services Association, helps to represent debt recovery and tracing agents. He said that Credit Services Association Code of Conduct required them to confirm one’s identity before contacting them. Something just went wrong.

"We have a code of practice and it says members are required to take all possible steps to verify that the person being pursued is in fact the debtor," he told the program.

The Office of Fair Trading also recently issued guidelines, which was meant to warn debt recovery companies to not send out letters of those in debt to try and determine who to bill. If you have received a false debt letter, Citizens Advice says,” anyone who receives a letter in error should contact the debt recovery company and tell them they are not legally liable for the debt.”