The Tracing Game

Peter Heims reports.

Recent changes in the law have severely restricted tracers’ access to legitimate sources for tracking down debtors. But parts of the law appear to conflict and the fact tracers cannot reveal a debtor’s personal circumstances could mean some form of pretext enquiry is allowed.

Tracing Agents under pressure from Data Protection Act

Tracing agents have been under pressure over the last few years facing tighter controls over what they are allowed to do to find debtors.

One of the biggest blows to the industry was the Data Protection Act 1998 or as it is known by creditors and tracers alike, ‘the debtor’s charter’. Its underlying principle is that data should be obtained fairly and without deception. However, since its implementation good tracing agents who were able to trace 70 per cent of debtors found their success rate dropped significantly to just 50 per cent.

For example, The Association of Chief Police Officers has decided to evoke the Data Protection Act to its limit and refuse to talk to investigators. When thefts of motor vehicles are reported, the police do not attend but merely note the details and provide a crime number. Because of the attitude of the police and The Home Office, many insurance companies now no longer bother to have dubious claims investigated. It is known, unofficially, that insurance companies have decided to pay out on most claims and to simply pass this on to their members by increasing their premiums.

On the face of it these ‘principles’ would appear to be reasonable conditions. However, “fairly and lawfully processed” is the most important to be considered by any person involved in tracing debtors.

Personal data should be fairly and lawfully obtained. The definition of “lawfully” is obvious to us all but how would we each read the definition of “fairly” as applied to this context? The previous Information Commissioner, Elizabeth France, in her ‘Data Protection Guidance, Debt Tracing and Collection - July 1997’ sets this out.

Elizabeth France clearly indicated when defining the first principle that the gathering of information by deception was unacceptable. Her policy was very strongly supported by her successor’s statements.

This clearly outlaws the use of a pretext or deception when obtaining information. In other words “lying” to obtain information would appear to be immoral and unfair.

Blaggers face unlimited fines and imprisonment

Richard Thomas, who recently succeeded Elizabeth France last November, clearly outlined his policy in respect of private detectives and journalists who ‘blag’ confidential details from banks and telecom companies. They will face unlimited fines and possible imprisonment.

He said some of the worst cases involved tracing agents ho have stolen tax details by impersonating an individual and conning Inland Revenue officials into making wrong disclosures.

Mr Thomas, who is also a solicitor, went on to say that his team was working with the Inland Revenue and Work and Pensions officials in investigating a number of un-named cases of information stealing. These allegations involve the sale of personal information which had been obtained through the impersonation of an individual, of fraud which he described as ‘blagging’.

Regrettably, ‘deception’ has always been an integral part of the private investigators handbook with the use of the pretext enquiry being common place.

The old scenario where a tracer would contact family relations on the pretext that they had an attractive proposition to make to the debtor - perhaps an offer of lucrative work - is no longer allowed.

Now, tracers can no longer offer such inducements and have to say that they need to contact the debtor over a ‘confidential matter’ which is unlikely to tempt family members to give out their relation’s new address or phone number.

So the stage has been set - no deception whatsoever. Or has it?

A degree of deception is acceptable

Christopher Brogan, a well known private investigator who is the industry’s guru on the Data Protection Act, said: “A degree of deception is acceptable in tracing absconding debtors according to an assistant information commissioner. But making enquiries to a government official or obtaining access to someone’s home by deception is totally unacceptable. Informing a neighbour you are an old friend of the debtor and that you were passing by and thought you would like to see him and then engage the neighbour in conversation as to the subject’s current whereabouts is acceptable. This is based on the arguement that if you introduce yourself to the neighbour, tell them you are an investigator acting for A and that you wished to know the whereabouts of B because there was an outstanding matter that needed to be resolved, would not be protecting the data subject’s privacy. The neighbour would not to be Sherlock Holmes to realise that B owed money.”

That would appear on the face of it to be fine but who decides on the extent of that deception?

Just how far should it go? Tracing Agents are in a complete quandary. Elizabeth France has clearly indicated that deception is not to be used. Thomas has even gone as far as to say that if deception is used, then a prison sentence could be in order.

On the other hand, Chris Brogan indicates that the stance of the Information Commissioner has softened.

So whose attitude should be followed? The only way that this question will be decided would be a test case and what private investigator or tracing agent in his or her right mind would be willing to be the guinea pig? this is something which most tracers are reluctant to volunteer for. As a result all reputable agents are keen to stick to the rules.

What does the future hold?

What does the future hold for the poor old tracing specialist? Voters now have the right to decide whether they wish their particulars published on an electoral register which is available to the general public. This means there are now two registers in use - one containing details of all persons entitled to vote. The second is an edited version omitting the particulars of those taking advantage of the new procedure. Who do you think many of these will be? Why, debtors of course who do not wish to be traced.

These are all sources often used by private investigators when investigators are searching for a very elusive debtor.

Should this forecast become a reality then the success rate of traced debtors will be lessened further with the cost of the successful traces being increased.

These increased costs and the amount of revenue lost by those debtors who have obtained sanctuary as a direct result of the Data Protection Act will not be borne by the credit companies which would increase charges to meet this contingency.

In other words in trying to increase the consumer’s privacy the government has also left the honest citizen picking up the tab for those who play fast and loose with the system.

This article was first published in Cred 2003, the UK Credit Industry Directory and Year Book.

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Peter Heims