If you are contacted by a creditor or debt collector in regard to a debt that you believe has already been paid or settled or that you do not think you ever owed in the first place you should not just ignore this.
If you ignore this type of collection demand the creditor demanding payment from you may take further formal action against you which could result in them issuing a CCJ (County Court Judgement) against you. They could then apply for an attachment or earnings against you or even a legal charge against your property.
It is actually relatively easy to take action against a creditor who you believe is trying to collect a debt that you do not owe. The OFT (Office Of Fair Trading) treats this kind of activity by creditors very seriously and has given clear guidance on the matter.
OFT Debt Collection Guidance regarding disputed debts
Under the OFT Debt Collection Guidance it is unfair to pursue an individual for payment of a debt which they are not liable for. The guidance states that it is also unfair to send demands for payment to an individual when it is uncertain that they are the debtor in question or if the creditor or collector in question ignores and/or disregards claims that debts have been settled or are ‘disputed’.
The guidelines state that it is deceptive and or unfair not to cease collection activity whilst investigating a reasonably queried or disputed debt. To continue to make unjustified demands for payment could then amount to physical or psychological harassment which is punishable by law under section 40 of the Administration of Justice Act.
How to dispute a debt that you do not owe
If you feel that a creditor or debt collector is contacting you about a debt that you do no owe or have already paid you must first make this clear to them in writing. The best way is to use the our disputed debt harassment letter template. Simply send us an e-mail and we will send you the template.
You should amend the template letter for it to apply to either one person or to more. When you have finished before you print the letter change the entire text to black read it though to make sure it makes sense. Keep a copy and then post the original to the creditor or collector using the post office recorded delivery service.
If writing to the creditor or collector using this template fails to stop the harassment then you should report the issue to the Financial Ombudsman.
For more information about escalating a complaint see the consumer complaints section of their website.