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The curious tale of the pyramid and the shaming of Russian debtors

15 October 2019 Written by Stephen Cowan Category: Blog

A Russian utility company has come up with a novel way to ensure it gets paid on time. Essentially, they dump a pyramid, weighing no less than three tonnes, on your front lawn with a variety of messages.

Basically, a water company had outstanding accounts due to them by an individual who owned a detached house. The company tried everything to get the £662 debt paid, including sending letters to the alleged debtor followed by a series of phone calls – all to no avail. To address the issue more forcefully, they came up with the bright idea of what can only be described as naming and shaming the debtor. What they did was place a three-tonne pyramid, with a height of 1.5 metres, with slogans printed on it at the front of the debtor’s house. The messages on the pyramid were “A debtor lives here” and “You must pay your water bill”. Quite an effective reminder to get a bill paid on time, one may think.

It appears that the fact the debt was disputed was a minor detail. The alleged debtor remonstrated that the water supply had been removed for several months, during which period he continued to receive bills from the company. All of these overtures, he pled, were ignored by the water company.

Despite his entreaties falling on deaf ears, a number of curious neighbours ventured to the outside of the house to view the pyramid. Presumably out of embarrassment, the debtor settled the alleged debt. The upshot was that the company was so delighted with the result that they now intend to use the modus operandi as a regular method for getting paid (not one of the tools in the armoury of a sensible UK credit controller one may add!). However, with outstanding debts of over 1.2 billion Rubles, this would appear to be the preferred choice of action.

There is, of course, a serious aspect to the story. Basically, no responsible EU credit controller would attempt the recovery of outstanding invoices using this method. Putting it simply, the methodology is entirely inconsistent with the General Data Protection Regulation which provides that personal data shall be “processed lawfully, fairly, and in a transparent manner in relation to the data subject”. In addition, data shall be” adequate, relevant and limited to what is necessary in relation to the purposes for which they are processed”.

In addition, in the UK water companies are governed by OFWAT, the industry regulator. They have a code of practice which, amongst other things, will oblige water customers to “treat their customers fairly” as well as focusing on how to address customers’ “fuel poverty” in a sympathetic manner.
It just goes to show, in the absence of such regulation, how non-regulated credit control can function largely out of control. Those whose view is that we are over regulated should, perhaps, pause and reflect on the Russian experience which is clearly unfair and could certainly cause serious harm.

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