Monday, 30 July 2018 21:07

Debt collection firm slammed over harassment of Telstra bill defaulters Featured

Debt collection firm slammed over harassment of Telstra bill defaulters Image courtesy of Sira Anamwong at

One of Australia’s largest debt collection firms, ACM Group, has been slammed in the Federal Court for its harassment and coercion in pursuing debts from consumers who had defaulted on their Telstra phone bills.

The two telco customers had defaulted on phone bills, and in each case the debts had been sold by Telstra to ACM.

The Court found ACM guilty of contravening Australian Consumer Law — and of engaging in “misleading or deceptive conduct, harassment and coercion, and unconscionable conduct” — in its dealings with two “vulnerable consumers” when seeking to recover money.

The alleged conduct occurred between 2011–2015 in relation to one consumer, a resident in a care facility, and in September 2014 in relation to the other consumer, a single parent with a limited income.

ACM was heavily criticised by Commissioner Sarah Court of the Australian Competition and Consumer Commission who said its conduct was “particularly egregious” as it included ongoing harassment of a care facility resident who had difficulty communicating after suffering multiple strokes.

Court also criticised ACM for its conduct relating to a Centrelink recipient who was “falsely told their credit would be affected for up to seven years if they failed to pay immediately”.

“ACM was found to have made empty threats to litigate against both customers despite knowing they had no means, or only limited means, to repay,” Court said.

“One of the ACCC’s enduring enforcement priorities is taking action against conduct that impacts disadvantaged or vulnerable consumers.”

She said the ACCC and the Australian Securities and Investments Commission hade done extensive work to improve debt collection practices – noting that lower-income groups suffer greater stress because of debt collection practices and have “limited access to legal support, while creditors are using improper ways to escalate disputes”.

In his judgment, the Federal Court’s Justice Griffiths rejected a number of explanations of why ACM had contacted one of the consumers 34 times and found that conduct amounted to undue harassment and coercion.

And Justice Griffiths also found that the multiple telephone calls, coupled with the number and content of its correspondence, was calculated to intimidate or demoralise the consumer.

“ACM cannot justify its conduct on the basis that it required verification of information about [the] medical or financial circumstances when ACM itself did not take reasonable steps to contact people who may have been in a position to provide such verification,” Justice Griffiths said when delivering his verdict.

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Peter Dinham

Peter Dinham - retired in 2020. He is a veteran journalist and corporate communications consultant. He has worked as a journalist in all forms of media – newspapers/magazines, radio, television, press agency and now, online – including with the Canberra Times, The Examiner (Tasmania), the ABC and AAP-Reuters. As a freelance journalist he also had articles published in Australian and overseas magazines. He worked in the corporate communications/public relations sector, in-house with an airline, and as a senior executive in Australia of the world’s largest communications consultancy, Burson-Marsteller. He also ran his own communications consultancy and was a co-founder in Australia of the global photographic agency, the Image Bank (now Getty Images).

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