What Can Debt Collectors in Singapore Do and Not Do Under the Law?

Throughout the years, cases involving debt collectors harassing debtors have raised public alarm. One such incident involved a debt collector who wore a traditional funeral outfit to the debtor’s workplace while carrying a banner with the debtor’s face, and the other involved 6 debt collectors who harassed a food stall in Funan Mall and damaged equipment at the stall. Such cases have led to calls to regulate the debt collection business.

The Debt Collection Act was introduced in 2022 to regulate the debt collection industry to prevent problematic debt collection conduct. This includes introducing a licensing regime for debt collection companies and approvals for debt collectors. Additionally, the Debt Collection Act stipulates that licence holders are required to comply with other written laws, including the Penal Code and the Protection from Harassment Act. For example, debt collectors must not engage in behaviour that threatens the physical safety of the debtor, such as sending messages threatening physical harm.

Nevertheless, it is still important to keep in mind that rogue debt collectors may, unfortunately, continue to engage in conduct that is legally prohibited and may amount to offences under the relevant legislation in Singapore. These are discussed below.

Inflicting Injury

An obvious instance of illegal conduct is when a debt collector inflicts injury on the debtor. This could include a range of injuries, such as knocking the debtor unconscious or wounding the debtor with punches. If the debt collector is found to have an intention to cause hurt or the knowledge that he is likely to cause hurt, he may face up to 3 years’ imprisonment and/or be fined up to $5,000.

More severe injuries are classified as “grievous hurt”, which include but are not limited to fractures, dislocations, disfigurations or severe bodily pain for at least 20 days. An offender who is guilty of voluntarily causing grievous hurt may face up to 5 years’ imprisonment, and/or be fined up to $10,000.

Threats or Intimidation

Debt collectors often resort to threats or intimidation to pressurise the debtor into paying up. For example, debt collectors may start using profanities and threaten to resort to more extreme measures, such as splashing paint at one’s doorstep in order to pressurise the debtor into paying up. If the debt collector is found to have done so to intentionally cause distress or alarm to the debtor, it may constitute harassment under the Protection from Harassment Act. The penalties for which are a jail term of up to 6 months and/or a fine of up to $5,000.

If threats are made to injure the debtor or destroy his home, the debt collector may even be liable under the Penal Code for criminal intimidation. The penalties range from a minimum of up to 2 years to a maximum of 10 years, and/or a fine, depending on the severity of the criminal intimidation.

Notably, these threats need not be verbal. For example, if a debt collector gestures to splash the paint at the debtor’s doorstep and causes alarm to the debtor, this could also be classified as a threat.

Vandalism

If the debt collectors do resort to vandalism, this will constitute an offence under the Vandalism Act. Vandalism could come in many different forms. A typical example in debt collection would be the splashing of paint or writing on the walls outside the debtor’s house. Other examples include the pasting of the notice of collection onto the walls or the hanging of a banner at the debtor’s workplace. If found guilty, a first-time offender may face a jail term of up to 3 years and/or a fine of up to $2,000. The punishment may include caning.

Such actions may also be classified as a nuisance under the Miscellaneous Offences (Public Order and Nuisance) Act. A typical example of a nuisance is when the debt collector pastes a notice of collection onto the debtor’s door. If found guilty, the debt collector will be liable for a fine of up to $1,000.

Where damage is done to any property or the value or usefulness of the property decreases, these actions could also be punishable as mischief under the Penal Code. The punishment for mischief is imprisonment for a term of up to 2 years and/or a fine. 

Unlawful Stalking

The Protection from Harassment Act also protects debtors against unlawful stalking. Unlawful stalking occurs when debt collectors repeatedly follow or repeatedly cause harassment, alarm or distress to the debtor. The intent or knowledge to cause such harassment, alarm or distress to the victim must be found to constitute unlawful stalking. The stalking must be a repeated occurrence and not a one-off event. The more frequently these actions have occurred, the greater the likelihood they are found to be unlawful stalking.

For example, debt collectors who deliberately follow a debtor from their house to their workplace and back, causing discomfort and making the debtor feel “watched” may be considered as unlawful stalking. Other examples of unlawful stalking include debt collectors entering into or lingering around the debtor’s whereabouts, and repeatedly recording videos or taking photographs of the debtor.

The debt collector may even be liable for unlawful stalking where the stalking is done electronically. This may include incidents such as repeated e-mails.

The penalties for unlawful staking are a jail term of up to 12 months and/or a fine of up to $5,000. The penalties are enhanced for repeat offences or offences caused against vulnerable persons.

Note that in cases where the debt collector contacts the debtor while the latter is at work, the act of contacting the debtor at his work itself is not illegal. It is usually the frequency of the act together with the alarm or distress it causes to the debtor that will constitute an offence.

Unlawful Assembly

Where debt collectors show up in a group of five or more persons, they may be considered an “unlawful assembly” under certain circumstances. Examples of such circumstances include the use of criminal force to take away your belongings, prevent you from leaving the area or harass you.

Members of an unlawful assembly may be sentenced to prison for up to 2 years and/or fined. In the Funan Digitalife Mall case, three out of the six debt collectors were sentenced to jail for unlawful assembly. 

What Steps Can Debtors Take If the Above Happens to Them?

Debtors can always call the police when they encounter any of the above scenarios. This may put debtors outside of any immediate danger until further action can be taken. Debtors can also seek to clarify with the police whether the actions of the debt collectors constitute illegal or unreasonable conduct.

If the debt collectors’ actions constitute an offence under the Protection from Harassment Act, debtors may also apply for a Protection Order or an Expedited Protection Order against the debt collector and/or the creditor.