Topic: UK Bitcoin Debt Collection - page 2. (Read 3148 times)

The Office of Fair Trading disagrees.


As above, this isn't how it's meant to work.  You don't legally get to harass people for a while, then start a legal action, then outsource debt collection if the court doesn't issue a judgement / wage garnishment order.

I'm not taking any position as to whether or not this is a good idea - I'm just pointing out that you need a license to undertake the described activities in relation to a debt for which you aren't the creditor (and you don't meet one of the 2006 Act exceptions).  Otherwise you face investigation by the Office of Fair Trading, penalties under the Consumer Credit Acts, and possible harassment charges under the Protection from Harassment Act 1997 depending on your specific conduct.

There's the strong possibility that your mark isn't going to know about the legal rights available to him/her, or might be all kinds of dodgy as far as the original loan, tax avoidance and other matters.  In that case, you might be able to get away with doing whatever you want to do without having the full weight of the law behind you. But there is very little room for debate as to whether the law currently requires you to have a licence.  What you're proposing falls very clearly under the requirements listed for licencing.  if you're doing debt collection prior to initiation of a court case and you aren't the creditor, you need a licence. 

What's more, the lending companies or individuals themselves may need to be licenced, particularly if the loans are denominated in £ rather than BTC (and for recovery purposes they would likely need to be).  It's debatable what the court's position on BTC-denominated debts will even be, but the Consumer Credit Acts set out licencing and reporting requirements for business engaged in the business of lending.  So if you got yourself into trouble in this process you could also get your clients into trouble for simply being in the business of lending.  More info here.

This could eventually work, and it might eventually be called for.  But unless you know something big that I do not, you may have to substantially adjust your proposed business model.  And my guess is that at the moment there isn't a large enough UK-only BTC debt market to support it.  Then again, if your lawyers believe that you can get away with doing it, go to town.  But if you're doing this in the absence of good legal advice, I'd strongly suggest you seek some before you take any further steps to make this happen.

/thread 

He now flies above international waters to avoid being in any jurisdiction:

Pics?

Trendon doesn't live in the UK so it would be a really difficult place to start.

Start with Trendon and get back to us?

Debt collectors in UK are toothless tigers. They can do only two things:
1. send 1000 letters.
2. sue.

Thanks for the support!

Appreciate your comments and suggestions, will keep you updated.

Sounds like it could be a very useful service.

My only worry is it could very negatively affect the world perception of Bitcoin if handled badly.

"Virtual currency sees rise of vicious debt collection" would be the last thing we need for the community.

The market for Bitcoin debt in the UK will be quite small so I can't see you making a living pursuing just Bitcoin debt but if your service does well then it could add stability to the UK Bitcoin market which can only be a good thing.

Good luck with the venture - I hope you do well and represent us in a good light

Thats the thing, some of the debts may not end up in court after we have chased them for a while, Court would only be for those that make no communication back with us - But yet we were able to confirm the identity and location.
Only if they were able to confirm that they completed some Verification steps before hand. Theres nothing much that we can go on by just using a Forum Name. This is something that would need to be looked at more deeply. I would hope this is something we could sort out.

Initally, we will only be looking for (From Lenders like BTCJam etc) Name, Address, Loan Details. They would then be contacted and sent some reminders, if they then didnt pay or didnt make an arrangement to pay, then we would look at getting this passed to the courts for action.

Will you only be going after court approved debt?



Does this mean this service will only be available to big organisations or will User654321 be able to use it too?



80% seems a low bar on proof if you ask me but if you're only after court approved debt I guess that actual percentage will be much higher.

Thanks for the kind words above.

In regards to licensing, 'We' would not need a license to collect this debt as we would chase the defaulter and then continue with legal action. The legal action would cover any licensing requirements. If the court ruled that we would have to collect the debt (IE They didnt issue an Attachment to Earnings or a CCJ etc) then we would have to look into outsourcing the actual physical collection activities to registered and licensed firms.

We would look at only working with lenders that have been able to provide and verify all this information before we started to chase. For example, I've used BTCJam before and they require ID to increase your site 'Credit File'. This information would then be checked with other providers in the UK (There are specialist company that are able to confirm the identity of people by using details such as the Electoral Role etc). If we are then able to confirm that there's a 80% chance that the documents submitted are legit etc etc, then we would start to pursue the debt.

Hope this makes some kind of sense!

The shoot first, ask questions later attitude is annoying.

Why not give OP an opportunity to address your concerns before shooting him down?

OP - will you be licensed or acting under a license of some sort? Do you even need to be licensed?

What steps do you take to ensure a default is real/valid before chasing down the debtor?

Keyboard Warrior!

Whats my chuffing Avater got to do with it? And as this topic said, this was to discuss the 'Idea' of setting something up - Didnt say Its been set up or anything like that

God, it had to be the UK didn't it - king of the scummy debt collector - invading bitcoin land

Your yarn about a bitcoin debt collection service sounds as legit as 5-legged horse.

Where are all these bitcoin loans people have defaulted on? You probably don't want to give too much away ........ since you are going to be running a legit company why not publish your details, limited company right?  

Scum - your avatar says it all

Thanks for your Response,

I know that some of the sites that offer BTC loans do ask for personal information such as Proof of Address / Income etc - Maybe this is something that they can pass onto us when they pass the collection onto us?

I know in the UK, Bitcoins are classed as Property, whether or not they are virtual (Like WoW gold) - So this is something that could be collected with all the correct steps being taken first.

The license is not an issue (I dont want to give much away) but this is something I have looked into

There are a few problems with this idea:
      
       -Bitcoins give you a lot of anonymity
       -Most of the scammers don't provide the lenders with real information.
       -I'm pretty sure you need a license in order to collect debt.

Hey Guys,

I'm looking to set-up a debt collection group to chase creditors that have 'defaulted' on Bitcoin Loans.

Please let me know your idea's and Questions? Could really do with an opinion from other people before I get any balls rolling.

Many Thanks!