The total amount of resident debts was €1.1 billion, of which the officers collected nearly half last year – €602 million. The average amount of one debt is €300 to €500, the debtor is most frequently between 35 and 55 years old and the main offences are administrative penalties and alimonies.
As long as a private debt case has not come to court, the debts are collected by so-called extrajudicial debt collectors licensed by the Consumer Rights Protection Centre (PTAC). Jānis Lukaševskis, Chairman of the Board of the Extrajudicial Debt Collection Association, said that despite the Covid-19 pandemic and the decline in population solvency, the number of debts is not increasing yet.
"These are both non-bank credits and bank credits – debit and credit card loans, telecommunications and utility debt. The debt can be between €50 and €500 for bank loans, it can also be €2300-5000, while the average debt is €300 to €500. Extrajudicial debt collectors shall not have the right to block accounts or to sell movable or immovable property.
"Extrajudicial collection of debts is based solely on an agreement between the debtor and the creditor. It is more beneficial to agree and settle these obligations in this way than when the case comes to court and there are additional costs that significantly increase the debt," Lukaševskis said.
According to Iveta Kruka, Chair of the Latvian Council of Sworn Bailiffs – all debtors have one common characteristic – they avoid communicating with the debt collector.
"The ingrained myth – if I don't get a letter, then I don't know anything and no one can do anything to me. Before the case goes for enforcement, the authority shall make mandatory warnings that there is an unpaid penalty. A second mass problem – someone does not receive this consignment and says – you know, I haven't lived in this address for 10 years," Kruka said.
Debts of around €300 are mainly administrative penalties - for road traffic offences, for being in a public place under the influence of alcohol, for poaching, the loss of passports and others. Kruka explained that the debtor's monthly income was maintained at the minimum wage level, which is currently €500. “Whether it is 1.2 or 30 cases, we continuously monitor the personal income and assets," said Kruka.
Last year, the PTAC received 111 complaints about the extrajudicial collection of debts, but only two administrative cases were launched. On the other hand, seven disciplinary proceedings have been proposed for sworn bailiffs.