A Study by an Untar Doctor of Law Graduate
Source: Faculty of Law Untar
Financing companies must take preventive measures to anticipate potential legal violations committed by debt collectors during repossession and collection activities in the field. Debt collectors must also understand and comply with the ethical standards governing debt collection as stipulated in cooperation agreements with financing companies.
This was stated by Abd. Latip Lestaluhu during the Open Examination of the Doctor of Law Study Program (DIH) at the Faculty of Law (FH), Universitas Tarumanagara (Untar). His dissertation, titled “The Application of Liability under Article 48 Paragraph (4) of Financial Services Authority Regulation No. 35/POJK.05/2018 as a Result of Fiduciary Guarantee Execution by Debt Collectors Acting as Representatives of Consumer Financing Companies,” was defended on Wednesday (17/7/2024) at the Auditorium of Building M, Untar Campus I.
The study was inspired by findings of unprofessional practices among financing companies in debt collection activities, which have frequently led to disputes and legal issues.
Latip found that debt collectors often act contrary to legal and ethical standards, including engaging in verbal and physical violence against debtors. Such incidents generally occur when debtors attempt to defend their property or refuse to repay their debts.
According to the study, these confrontations sometimes lead debt collectors to bypass legal procedures by forcibly seizing property or committing acts of physical violence. Such actions not only violate professional ethics but may also constitute criminal offenses involving assault and unlawful confiscation of property.
To prevent such violations, Latip emphasized that debt collectors should be certified by a Professional Certification Institution (LSP) to ensure that they perform their duties in accordance with applicable laws and regulations. He also argued that the LSP should bear responsibility for providing technical guidance and supervision to debt collectors in the field.
Latip further highlighted the responsibility of financing companies for actions carried out under their legal authority, particularly in debt collection activities. He noted that many collection companies currently operate unprofessionally, resulting in company directors becoming directly involved in field operations and potentially subject to sanctions when violations occur.
External Examiner Dr. Wasis Susetio, S.H., M.H., underscored the novelty of Latip’s dissertation, particularly its discussion of the principle of strict liability. Under this principle, financing companies may be held accountable for unlawful actions committed by debt collectors, even when those actions were not directly instructed by the company.
The study concluded that clearer regulations are needed to define the liability of financing institutions for unlawful conduct committed by debt collectors. Legal responsibility should not rest solely with debt collectors but should also extend to the financing companies that employ or authorize them.
Latip explained that the principle of strict liability does not focus on whether the defendant committed negligence or wrongdoing. Instead, liability may be imposed regardless of fault. He pointed to an Indonesian court decision in which a company was held responsible because it failed to implement adequate preventive measures.
Internal Examiner Prof. Dr. Rasji, S.H., M.H., emphasized the importance of understanding Article 48, which often conflicts with its implementation in practice. He highlighted the need to define the conditions and limitations that determine the allocation of responsibility when problems arise during debt collection processes.
In response, Latip explained that several factors must be considered. Based on data from the Financial Services Authority (OJK), administrative sanctions can only be imposed on financing companies rather than debt collectors.
Meanwhile, in civil law contexts, liability may be imposed on both financing companies and debt collectors because contractual agreements bind both parties to specific rights and obligations. In criminal law contexts, however, responsibility rests with debt collectors when they commit acts of violence or other unlawful conduct during collection activities.
The Open Examination was chaired by Untar Rector Prof. Dr. Ir. Agustinus Purna Irawan, M.T., M.M., I.P.U., ASEAN Eng., with Prof. Dr. Mella Ismelina F.R., S.H., M.Hum. serving as principal supervisor and Prof. Dr. Ariawan Gunadi, S.H., M.H. as co-
The examination board was chaired by Prof. Dr. Amad Sudiro, S.H., M.H., M.M., M.Kn., with internal examiners Prof. Dr. Abdul Gani Abdullah, S.H., LL.M., Prof. Dr. Rasji, S.H., M.H., and Dr. R. Rahaditya, S.H., M.H. The external examiner was Dr. Wasis Susetio, S.H., M.H.
Before the examination board, Latip, who works as an advocate, successfully defended his dissertation and was declared eligible to receive a doctoral degree, becoming the 39th graduate of Untar’s Doctor of Law Study Program. (KJ/YS/PA/KJ)
Keywords: Higher Education Tri Dharma (Research), SDG 4 (Quality Education), SDG 8 (Decent Work and Economic Growth), SDG 16 (Peace, Justice and Strong Institutions), SDG 17 (Partnerships for the Goals)
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