Letters being sent by a Debt Collection Agency to drivers who fail to pail Tyne Tunnel fees are “initimidating and misleading” debt charities have warned.
The Debt Collection letters advise of potential fines and even criminal convictions. The letters also warn of further debt collection costs, high court orders and even bankruptcy.
TT2 which is the Operator of the Tyne Tunnel said the wording in the debt collection letters was “fair and appropriate” and was in line with guidelines.
One letter recipient called ‘Gary’ and on universal credit told BBC news that a letter he had received for not paying the tunnel toll was totally ‘stressing him out’.
“Tyne Tunnels have completely washed their hands of the situation within a very short period and just say it’s in the hand of the third party and I have to communicate with them” said Gary.
TT2 said the debt collection agencies involved were trained in dealing with people in difficult circumstances. They also advised there were “options available to support these customers”.
The letters are sent by one of two debt collection agencies. Marston Recovery and Court Enforcement Services, which is part of the CDER group. The debt collection letters are sent to drivers who have been issued with a charge notice and not paid it.
Some drivers claim the notice is invalid as they paid the toll, others argue their toll payment should have been accepted even though it was late and outside the rules. A number claim their toll was only late because of flaws in the payment system.
Charities and critics of the system say the debts should not be passed on to a debt collection agency whilst it is disputed.
The initial penalty is £60 on top of the original £1.90 fee, reduced to £30 if paid within 14 days. This rises to £100 if not paid within 28 days, after which the debt is passed to one of the two DCAs.
The agent then adds its own fee but some drivers are charged more than others. TT2 could only explain the disparity in Marston adding £65 and CDER £75 as being “based on their costs for recovering the debt”.
If the fine remains unpaid, the debt owed increases as various debt collection fees are added which have left some drivers facing demands for more than £700.
Sue Anderson, from the debt charity StepChange, said the debt collection letters sent by Marston and Court Enforcement Services/CDER were a “prime example of poor debt collection practice”.
The letters were “designed to push people into paying large penalties” said Ms Anderson.
Ms Anderson also said that using language that is “intimidating and confusing, with threats of quick escalation to enforcement action” may also cause people to “disengage”.
The Money Advice Trust said some of the wording in the debt collection notices could be “misleading and imply greater powers of recovery than are possible”. The debt collection agents have denied this.
Guidelines on debt recovery letter phrasing warn against using “potentially misleading” words such as “enforcement” in trading names so as not to deceive debtors.
They also caution against not making clear the number of legal steps required before enforcement action can be taken and implying it is more likely than it is. The Letter before action as it where has been requested to be toned down to prevent confusion.
CDER is reported by BBY News website to have said the reference to enforcement agents on its letters “is standard text and reflects the primary nature of the business CDER Group undertakes”.
It said it was “unclear of the objection” to the trading name Court Enforcement Services although it seems quite obvious as to why that may be.