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Last Updated: Saturday, 9 September 2006, 14:37 GMT 15:37 UK
Debt letters sent to wrong people
Bob Howard
BBC Radio 4's Money Box

As debt recovery companies attempt to track down around 5bn a year, occasionally it is innocent people who are targeted.

Desmond Phillips
Desmond Phillips found himself caught up in someone else's debt

Desmond Phillips got a shock when a letter demanding payment for a debt of 575 landed on his door mat.

Addressed to a Daniel Phillips at his address, at first he thought he was a victim of identity theft.

When he contacted the company which sent the letter, JB Debt Recovery, it quickly became clear it had targeted the wrong D Phillips.

"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 after his call, they would not contact him again.

He asked where they had got his name and address from and he was told it was from a service called Equifax Locate.

Further steps

Equifax is one of the three companies which holds details of the credit histories of millions of UK consumers.

It uses this information, along with the electoral role and other databases to try to track down "gone aways", people who owe money and then disappear.

Neil Munroe, its external affairs director, said JB Debt Recovery was told Equifax only had a match for a Desmond Phillips, not the Daniel Phillips they were pursuing.

He said JB Debt Recovery needed to have established if this was the right identity before they sent out any letters addressed to Desmond Phillips' address.

"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.

JB Debt Recovery said the information from Equifax did link the debtor to Desmond's address.

They say they now believe that the information provided to it by Equifax was "erroneous". But Equifax denies this.

When Desmond asked amongst his friends and colleagues, he quickly discovered one of them had received a similar letter but from a different debt recovery company.

Wrong gender

In Penny English's case, the P English they were seeking was not even a woman.

"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, which was trying to trace Mr English, told the programme that it wanted to apologise for its mistake and that it now uses a more reliable system to track down "gone aways."

Members are required to take all possible steps to verify that the person being pursued is in fact the debtor
Kurt Obermaier, Credit Services Association
Kurt Obermaier is executive director of the Credit Services Association which represents debt recovery and tracing agents.

He said his association's code of conduct means members should make every effort to confirm someone's identity before contacting them.

"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 programme.

The Office of Fair Trading has also issued guidelines which specifically warn debt recovery companies from sending out speculative letters when they attempt to trace debtors.

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.

BBC Radio 4's Money Box was broadcast on Saturday, 9 September 2006 at 1204 BST.

The programme was repeated on Sunday, 10 September 2006 at 2102 BST.

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