A Montreal collection agency broke the law to recover the debt that a young client had contracted with Desjardins, the court recently ruled.
The Aro firm was trying to contact the 20-year-old Laval resident by calling his mother, a practice prohibited by law, ruled the Court of Quebec, in a rare judgment on the debt collection industry.
The court file also reveals that the collection agency directed the young man to a short-term loan service, so that he could take out a second loan to repay the financial cooperative. A strategy that “shocks” Option consommateurs, a public defense organization. The Aro website also directs people in debt to alternative lenders.
“Aro had a different interpretation of a specific article of the recovery law. We were unable to convince either the Consumer Protection Office or the court of this interpretation,” said the owner of the company, Michael Ogilvie. “Upon receipt of the decision, we immediately adjusted our approach and conducted training for our staff with the aim of eliminating any repeat offenses. »
Aro, a Quebec company founded in 1994, operates offices in Montreal, but also in Ontario, British Columbia and Newfoundland and Labrador. She recovers several million in debts annually, according to court documents.
“Desjardins’ partner collection agencies must respect the law,” Desjardins said by email. “We have just learned of the judgment of the Court of Quebec concerning the firm Aro inc. (…) We will analyze the judgment and act accordingly. »
Directed towards a second loan
It was in August 2020 that Aro contacted the young Laval resident, in order to recover an unpaid sum of nearly $3,000 on a Desjardins credit card.
The main interested party offers to make an immediate payment of $500, then to make “monthly payments between $200 and $300,” according to the recording of the call played during the trial. The debt collector takes note of the proposal, but “is clearly not open to this idea,” notes the court decision, dated January 25. He instead directs him to Fairstone, a personal loan firm: “they do second chance credit loans”. Objective: pay the first debt by contracting a second.
“I know how it works, I don’t want to get into debt with someone else,” says the young man, refusing this option and insisting that his proposal be considered. “It’s not getting into debt with someone else, you’re taking a bad debt that’s in collection and you’re converting it into a good debt on which you’re going to make your regular payments,” the agent replies. recovery. The appeal ends without a final decision being made.
Michael Ogilvie, of Aro, did not want to comment on this aspect of the case.
“For consumers, repaying one debt with another debt is rarely a good solution,” commented M.e Sylvie de Bellefeuille, from Option consommateurs. The lawyer argued that a debt that lands on the desk of a collection agency is already associated with a credit score so low that it usually cannot go any lower.
“It shocks me,” she added, however raising the possibility that Desjardins was kept in the dark by the collection agency.
Illegal calls
However, it was for the calls to the mother of the young man in debt that Aro and his employee were found criminally guilty.
The woman, who had not lived with her son for several years, spoke on the phone with the agency twice and was contacted at least one other time without responding, according to her testimony at the hearing.
After the third call, “the cup was full, so I filed a complaint with the help of the Consumer Protection Office,” she recounted in court.
The law provides that a collection agency cannot contact the relatives of a targeted person. The only exception: a single communication is permitted if the agency does not have contact details on file.
“The Court is of the opinion that Aro, through his representative, (…) communicated illegally with a member of the family” of the debtor, ruled Justice of the Peace Julie Laliberté, in a 30-page decision . Aro and his employee “failed to demonstrate (…) that they exercised reasonable care to avoid committing the alleged offenses”.
It was Aro who asked the young man to provide a second telephone number to reach him. He had mentioned that it was his mother’s number.
Aro argued that because the young man had given this number, the calls in question were attempts to contact him, rather than his mother. She also affirmed “that the evidence demonstrates at most that these telephone contacts were intended to contact the debtor and not to recover a debt”.
reference: www.lapresse.ca