Invoking fear, psychological pressure and confusion – these are the main objections of the President of the Office of Competition and Consumer Protection against debt collection actions of Euro Bank. For breach of collective consumer interests the penalty exceeding PLN 1.2 million was imposed on the undertaking

Paying installments is the duty of every borrower. Arrears cause serious consequences, of which the bank officials often remind the customers. It should be remembered that informing about the debt must take place within the limits of the law. Intimidation, pressuring, and unreliable information about the consequences of failing to pay the debt – these are the most common irregularities questioned by the President of the Office. So far, UOKiK has issued nine decisions concerning the unlawful debt collection and recently questioned recovery procedures of Euro Bank. Invoking fear, psychological pressure and confusion – these are the main reservations of the President of the Office against the bank debt collection activities.

The proceedings in this case were initiated on the basis of media reports in November 2009. The Office questioned the bank's internal procedure regarding debt recovery by phone. According to the findings of UOKiK, in the course of their recovery activities, the company has applied various forms of pressure on consumers failing to pay their debts. When contacting the debtors by telephone, employees of the bank informed them as follows:

(…)If in view of the above position of Euro Bank you still do not want to give back the money we do not have other choice. The Bank is forced to send your file to the Street Debt Collection. At the addresses provided we will send the intervention unit with our executors, who will take care of negotiations with you at home. Do not worry, our executors are specialists in the recovery of installments, which customers do not want to pay back. They will visit you at home in their uniforms and I am confident that after a quarter of negotiations in spite of all life's problems you will decide to give the money back to the Bank! (…)

The President of the Office concluded that Euro Bank, using illegal debt recovery procedures, violated the collective interests of consumers, and imposed on the entity a penalty of PLN 1,262,761. The Bank stopped applying the unlawful activities

According to the Office, informing consumers about the arrears in payment in this manner, Euro Bank wanted to intimidate and exert psychological pressure on debtors. In the opinion of UOKiK, such action was intended to force the consumer to repay the debt. It is worth recalling that the Office does not contest the creditor's right to recover the amounts due - debt collection activities, however, should be done with respect for good manners, dignity, and privacy of the consumer. The undertaking should honestly inform about the consequences of non-repayment.

The President of the Office concluded that Euro Bank, using illegal debt recovery procedures, violated the collective interests of consumers, and imposed on the entity a penalty of PLN 1,262,761. The Bank stopped applying the unlawful activities. The decision is final, because the undertaking has not exercised the option of appeal to the court and paid the penalty.

Assessing the practice by the European Bank, the President of UOKiK took into account e.g. the principles of good banking practice recommended by the Polish Bank Association and the Financial Supervision Commission. The documents set out the rules of operation of the financial institutions, which should be conducted in an ethical, trustworthy manner, according to the rules of morality and dignity of the customers.

Simultaneously, the Office reminds debtors that if there are problems with repayment of the loan, they should as soon as possible contact the undertaking and negotiate more favorable distribution of arrears in installments. The creditor may also propose extending the credit period or remission of penalty interest and recovery fees. Activities involving intimidation, harassment, psychological pressure are illegal and should be reported to the police.

Consumers who have concerns about the undertaking’s conduct regarding the debt recovery can count on the assistance of municipal or poviat consumer ombudsmen or non-governmental organizations - the Federation of Consumers, Association of Polish Consumers. Free counseling is also available by calling 800 007 707. Counselling in Poland is financed, among others by UOKiK.

Additional information for the media:
Małgorzata Cieloch, Spokesperson for UOKiK
Department of International Relations and Communication
Pl. Powstańców Warszawy 1, 00-950 Warszawa
Tel. +48 22 827 28 92, 55 60 314, 55 60 430
faks +48 22 826 11 86
E-mail: malgorzata.cieloch@uokik.gov.pl