Wednesday, November 7, 2012

Nova Scotia, Canada Cracks Down on Debt Settlement Companies ...

Nova Scotia, Canada has recently introduced new legislation to help protect consumers from debt relief companies and rogue debt collection companies.

The Debt Collection and Management Reform (2012) Act will target debt relief companies that make disturbing marketing practices and unachieved promises. It will also target debt relief companies that charge advance fee or up-front fees for debt help.

?The debt settlement industry is flourishing and many Nova Scotia consumers are being lured into believing that debt settlement is an easy fix and that their debt will disappear overnight,? said Don MacKinnon, president and CEO of the Better Business Bureau serving the Atlantic Provinces. ?Any change in legislation that helps to protect consumers from unscrupulous debt settlement companies that prey on Nova Scotia consumers, is welcome and supported.?

Changes to the acts include:

  • limiting collection agencies to three contacts in seven days
  • requiring written authorization from creditors for collections agencies to collect a debt
  • stopping ongoing calls when the wrong person is reached or the debt is disputed
  • creating authority for government to cap fees for debt management services and allowing fees to be charged only after a settlement has been reached with creditors
  • creating a debt management agency and debt management agent licences
  • prohibiting unlicensed debt management agencies

These changes will bring Nova Scotia?s practice for collection and debt management agencies in line with other provinces, particularly Alberta and Ontario.

The Debt Settlement Protection Act is still sitting in the legislature in Nova Scotia as well.

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Source: http://getoutofdebt.org/47452/nova-scotia-canada-cracks-down-on-debt-settlement-companies

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