Debt scams warning: what do to if you get a debt demand

A letter, call, email, text or doorstep visit demanding debt payment can be an alarming and confusing experience – particularly if it comes out of the blue.

If you don't recognise the debt, you need to be wary and verify the request before paying up, as not all such demands are genuine.

In one recent case highlighted by BBC Radio 4's 'You and Yours', a victim was tricked into paying a scammer who'd phoned him posing as a bailiff and threatening to seize his furniture.

Which? regularly hears from people being chased for unrecognised debts. This can sometimes be as a result of identity fraud – where debts have been racked up without the victim's knowledge.

In one recent case, a fraudulent default on a credit report nearly scuppered a mortgage application, so Which? intervened to get it removed quickly.

Read on to learn what a debt demand is, and how to check if it's genuine or a complete scam.

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What is a bailiff?

The terminology involved can be confusing, so it's important to understand the different types of professionals who might approach you about debt.

Bailiffs – more properly known as enforcement agents – work to enforce court orders demanding payment for unpaid debts. Examples include unpaid council tax bills, parking fines, court fines and county court, high court or family court judgments.

Enforcement agents have legal powers to collect debts or goods to the value of debts – but are only permitted to force entry to your home in certain circumstances (to collect unpaid criminal fines, Income Tax or Stamp Duty as a last resort). They must normally give you seven days' notice of their first visit.

The Ministry of Justice (MoJ) told Which? that if you're in any doubt about whether a payment demand is genuine, you should not pay until you've verified the contact. 

The way to do this depends on what type of enforcement agent the contact claims to come from. 

Enforcement agent trade body Civea advises:

• If the demand claims to come from an HMCTS bailiff (Her Majesty's Courts and Tribunals Service), contact your local county court using the details at Gov.uk.
• If it claims to be a High Court Enforcement Officer or Civil Enforcement Agent, contact the company the person claims to work for. 
• If you are worried or unsure, contact the High Court Enforcement Officers Association and the Civil Enforcement Officers Association (Civea), who may be able to help.

There is an official register of enforcement agents available online and run by HMCTS – part of the MoJ. However, Civea warned Which? that it is severely out of date and therefore can't be relied upon to verify contact. 

Responding to the allegation, HMCTS told us: 'We understand the importance of the register being accurate and updated in a timely way, and have undertaken a review of the processes in place to ensure they are as robust as possible.

'This has included refreshed and recirculated guidance for court staff to follow and we are exploring how we can improve and enhance the usability of the register further.'

What are debt collectors?

Unlike enforcement agents, debt collectors are not agents of a court. Though they may write, call or visit you at home and ask you to agree a payment plan, they have no special powers to force entry or seize goods, and must leave if asked.

Debt collection agencies (DCAs) may work on behalf of a company to collect debts such as unpaid loans, credit cards, overdrafts and utilities bills. Alternatively, they may have purchased your debts from your original creditor (who has sold them on), becoming the new legal owner. 

The basic principle is the same as it is for enforcement agents – if you're unsure whether a demand is genuine, don't pay. Instead, try to verify it using trusted contact details.

Doing this isn't completely straightforward, however, as there's no one-stop shop for DCAs' genuine contact details:

• If the debt relates to credit cards or loans, you may be able to find it on the FCA's Financial Services Register.
• If the alleged debt doesn't relate to a credit product (eg it is related to council tax, energy or internet bills), the DCA may not be on the register, making the contact harder to verify. In this case, it's worth checking the member directory of the Credit Services Association – a debt collection trade body. 
• The CSA told us it encourages anyone who's received a suspicious debt request to contact it for help.

Dodgy debt notices

Civea warns about the following red flags in debt letters or notices appearing to come from enforcement agents:

• Domains ending in '.legal' – these could be a scam and you should look for a UK domain. 
• References to 'bailiffs' in the body of a letter – other than in a company name, firms refer to 'enforcement agents', not bailiffs.
• Threats of Home Office attendance at a removal action – the Home Office does not attend enforcement visits.
• References to appointments for a removal action – enforcement agents do not make appointments after notice has been given.
• Threats of police attendance at a removal action – police do not attend unless there has been a breach of the peace.
• References to a High Court Enforcement Officer and/or Writ of Control re unpaid penalty charges – PCNs are not collected by High Court Enforcement Officers.
• Threats of locksmith attendance/forced entry re unpaid penalty charges – agents cannot force entry for PCNs or council tax debts.
• References to a 'Parking Charge Notice' – parking charge notices are not collected under the Taking Control of Goods Regulations 2013.
• Limited payment options – if bank transfer is the only option, that's likely to be a scam.
• Typos and grammatical errors – a genuine letter is unlikely to contain spelling or grammatical errors.

Concerning calls

Civea told us enforcement agents may contact you by phone to discuss a warrant of control. When they do this, they will offer to take debit or credit card payments over the phone. 

Genuine enforcement agents will have your court reference number, which cannot be obtained by fraudsters, so always ask for it if it isn't offered. 

A genuine enforcement agent will never telephone you to ask for your bank details, or to ask you to make a bank transfer using your sort code and account number.

Identity fraud

Sometimes debt demands come from genuine debt collectors or enforcement agents, but relate to debts wracked up in your name by a fraudster using your stolen identity.

Identity thieves can steal your personal information in a number of ways, including tricking you into divulging it (social engineering), obtaining details from a data breach or by stealing and opening your post.

Make sure you check your credit report to see if there are any new searches made or accounts opened in your name that you don't recognise.

If you spot anything unusual in your report, query it immediately with the company that recorded the information.

• Learn how to avoid and deal with identity theft. 

'Be on alert'

Simon Trevethick, head of communications at StepChange Debt Charity, said: 'Consumers should be on alert for scam bailiffs – essentially scammers posing as bailiffs and phoning people in debt to take their money. There are rules that cover enforcement action, and consumers should also know that there is an industry regulatory body called the Enforcement Conduct Board.

'It’s key to remember that a real bailiff will never telephone you to ask for your bank details, nor will they ask you to make a bank transfer using an account or sort code. Above all, if anyone calls claiming to be a County Court Bailiff, a High Court Enforcement Officer, or a Civil Enforcement Agent, do not make any payments or provide your bank details over the phone.

 'Anyone who has been impacted by this scam can report it to Action Fraud online or call 0300 123 2040.'