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Can a non-bank credit company freeze its debtor's bank account for a loan taken?

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asked on Oct 11, 2019 at 10:46
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edited on Feb 13, 2020 at 16:21
 
Does a non-bank company have the power to freeze a person's bank account?

A local credit company through its debt collection agency threatened that they will freeze the person's bank account. The loan was taken in 2007 and another restructured sum owed in 2010 after the borrower's lost his job in 2009. He could not continue paying due to lost of income. It has been dragged until now. Beside this he also owed credit card outstanding. And has since gone through AKPK for all financial and bank debts restructuring since 2016.

Does the credit company has the power to freeze a person's personal bank account? This owing does not come under the Banking Act. As it is a private entity that does not fall under the purview of Bank Negara Malaysia.
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answered on Oct 11, 2019 at 11:31
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edited Feb 13, 2020 at 16:06
 
This owing does not come under the Banking Act, as it is a private entity that does not fall under the purview of Bank Negara Malaysia.

The hire purchase creditor has to sue for the defaulted debt via civil court action.
Once a defaulter is made a Judgement Debtor, the Judgement Creditor (the local credit company) can apply in court for a Garnishment Order. It can done on banking accounts national wide. Irregardless of whether it is feasible for the Judgement Creditor to do it. The legal option is there.

Take note that a Garnishee Order is NOT restricted to banking accounts only as often discussed in this forum.

does not come under the banking act.
does not fall under the purview of Bank Negara Malaysia.

All legal money lending entities, including licensed money lenders falls under the purview of Bank Negara Malaysia. Hire purchase and equipment acquisition assets leasing companies come under additional Hire Purchase Act.
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answered on Oct 18, 2019 at 09:34
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edited Feb 13, 2020 at 16:21
 
@jeff005,

Thanks for your reply. 

Does Limitation Act apply if the default of the loan was in 2010?
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