In the last few years there has been a huge growth in loss recovery on behalf of retailers and other companies to deal with relatively minor cases not addressed by the criminal justice system.
Take for example someone (reportedly) stealing a packet of biscuits from a retailer. In minor cases such as this the police will not want to get involved, they simply do not have the resources. The retailers who experience multiple items of theft from a multitude of people on a daily basis simply cannot afford to do nothing. This is where Civil Loss Recovery comes in.
Companies have now been set up to recover the losses of the retailer. Clearly chasing someone for a £1 packet of biscuits carries with it a huge overhead, so these loss recovery companies add on hefty charges, mostly to cover “their costs”. The upshot is the £1 packet of biscuits could end up costing as much as £100 in recovery costs.
If the “accused” does not pay up then threats are made such as blacklisting in databases that may be seen by employers, or at least that is the threat. However if the recovery amount is quite large, let’s say £500 or more, then it is also likely that the loss recovery company may then used the small claims court system, which will add further costs and if these are not paid the “accused” will end up with a CCJ against their name.
Whilst a cost effective loss recovery system is good for retailers and consumers alike, it is only going to be effective if there is some degree of accountability and regulation to ensure that innocent people do not become trapped into paying debts that are not rightly theirs.
