Chris Brown, a member of the team who has worked as a Debt Management Plan Customer Service Officer and now works in the creditor liaison team, shares his views on Lloyds TSB.
Having worked in customer service for Abacus (part of ClearDebt Group plc), I have spoken with many of our clients on Debt Management Plans who have received correspondence from their creditors, which has caused them a great deal of concern. The letters in question are making demands for payment and threatening legal action.
Despite the fact that at some point or other, every lender is likely to send letters of this description, there has been and still is a repeat offender that is constantly filling up the letter boxes of their customers – Lloyds TSB.
Lloyds TSB Scare Tactics
As soon as an individual is no longer able to afford the contractual payments for a debt with Lloyds TSB, at least 500 square miles of rainforest is reserved and 50 lumberjacks employed to provide paper for the letters that will be sent daily until the debt is paid off. At least 5 species of rainforest creatures will become extinct and the debtor’s postman is 10 times more likely to suffer from arthritis in their post delivering arm during this period. This is not entirely true but it is in the Lloyds spirit of exaggeration and scare tactics.
The letter that causes the most concern, in my experience, is sent under the name SCM (Sechiairi, Clark & Mitchell) solicitors. They claim to be instructed by Lloyds to contact you because “despite several reminders your account remains out of order”. It goes on to say, if you do not pay them, legal proceedings may be issued at your expense. You are then “strongly urged to make immediate payment”.
The whole letter paints the image of ruthless legal professionals who take great pleasure in unleashing the full fury of the legal system against any individual unfortunate enough to cross their path. They are in fact a collections department of Lloyds.
Should you ignore the Lloyds TSB letters?
Having spoken to Lloyds about these letters they say the majority are sent during the process undertaken when an account is passed from their Financial Management Unit to their Central Debt Recovery department and apparently can be ignored.
So if they can be ignored, why send them?
I accept that letters should be sent to inform a debtor that their account is being handled by a new department within Lloyds (which they are), but to send a letter that gives the impression that court proceedings with be issued when they will not, is beyond unnecessary.
In addition to SCM solicitors they also have other collections departments that go under the names MHA collections and BLS collections (you can see some of the letters that they send here: MHA Collections letter, BLS Collections letter, SCM solicitors letter). It appears Lloyds want to give the impression that hundreds of mercenary debt collectors and legal teams are pursuing the debt on their behalf and are gathering on mass outside your front door.
Cutting unnecessary costs
After having to be bailed out by the tax payer, who now own over 40% of the company, I would have thought Lloyds would be looking for ways to cut unnecessary costs. A good way to start would be to stop sending out these letters to people who have found themselves in financial difficulty and have since taken responsibility to seek professional help.
In the time it has taken to read this, because of the intensive deforestation required to support Lloyds’ need for paper, the Borneo Jungle Ferret no longer has a habitat and is extinct. There is no Borneo Jungle Ferret, I made it up. The same way Lloyds made up MHA collections who may be taking legal action against you.