# Regulatory Compliance Category > National Credit Act Forum >  Illegal fees being deducted by debt administrators

## Eugene

Debt administrators are deducting illegal fees that are conservatively estimated at R800m from repayments made by over-indebted low-income earners, notes Laura du Preez in a Personal Finance report. 

Low-income earners who are unable to keep up their debt repayments have in the past sought, and may in the future continue to seek, the help of debt administrators to reschedule their repayments to affordable levels. But a Somerset West lawyer has found that most of these administrators are exploiting the people they are supposed to be helping and trapping them further in debt. Copies of distribution accounts that show how much of the money debt administrators collect from those under their administration was in fact paid to creditors reveal that administrators are charging fees of about 23% to 50% of the amounts they collect.

Full report on: http://http.persfin.co.za/index.php?...icleId=4067486

----------

enyaw (29-Jul-08)

----------


## Dave A

So now can the debtor take this to the National Credit Regulator?
How do they get relief?

----------


## Eugene

Debt administrations under section 74 of the Magistrate Court Act is not controlled by the NCR - only formal debt reviews (similar to an administration) in terms of section 86 of the NCA. The relief for a debtor under administration being exploited by the administrator would be to approach the Court to have the order rescinded.

----------

enyaw (29-Jul-08)

----------


## Dave A

But now surely the debtor is once again unprotected from the creditors.

This story is strikingly close to home. We've got a debtor under an administration order making payments of R200.00 per month to the administrator on a fair pile of debt.

We, as a creditor, are yet to see one cent.

The administration order itself incorporated a previous administration order with a similar monthly instalment payable. The new order seems to have simply netted the old debt with a pile of new debt under pretty much the same conditions.

In a way it seems the administrator is being paid to protect the debtor from paying their debt at all.

----------


## rossouws

Good day
I am with an Attorney for debt collecting. All my creditors are telling me they have not received a payment from them and I have several faxes confirming that although their spokesperson is telling me that a division was made in November 2007. I have been asking for a division list and what their cost are so many times but never received anything.What is the procedure because I am struggling to get any kind of paper work out of them.
Please if anyone can tell me the procedure.With the first visit I asked the lady what is cost to go under debt councelling and she told me nothing. I understand that they have costs but how much are they allowed to charge
Sonja :Confused:  :Confused:

----------

