News
Leasing companies still grabbing vehicles by intimidation
View(s):By Kasun Warakapitiya
Despite a reminder issued by the police last year of the process of seizing leased vehicles, many leasing and finance companies fail to follow legal recovery procedures.
Police issued a circular in February 2024 explaining the role of police officers in the process of vehicle acquisition. The circular was issued citing the “Finance Leasing Act” which laid out legal provisions on possession of equipment subject to lease financing including vehicles.
Lease payers say finance and leasing companies are seizing vehicles unlawfully.
Chamara Prasanna and left his vehicle that was seized. Pix by Akila Jayawardene
The circular also said that previous efforts have been made to inform police on how to respond actions according to legal provisions of the Act. The 2024 circular also mentioned that despite the previous circulars, complaints have been received that police officers do not act in accordance with those legal provisions in most cases.
Accordingly a lessor who is entitled to take possession of a vehicle under the Act or lease financing agreement should first inform an officer in charge of a police station in the area where the vehicle is located, get the assistance of a police officer attached to the same police station to prevent a breach of peace.
The circular states that repossession of the vehicle should be made without resistance.
The circular also states that when the lessee notifies a police station, steps should be taken to record the statement in the information notebook or as a written statement to affix it to the information notebook.
According to the Act, the lessor is only able to take possession of the vehicle if there is no resistance from the lessee, and if there is resistance, the lessor must file a case before the District Court.
The circular also emphasises that in cases where vehicles are seized in violation of provisions of the Act, the police should accept complaints by the leaseholders and investigations and legal action should be taken.
Deception, intimidation and assault are the means that prominent leasing companies use to unlawfully seize vehicles, victims say.
They complain that thugs are seizing vehicles.
In one of the most recent incidents, vehicle recovery agents (vehicle confiscators) deceived a van driver that they were hiring a van for a long distance trip to Kurunegala and drove off with it after intimidating the driver.
Don Chamara Prasanna Danthanarayana, a driver in Pallewela, said it all happened without warning.
Mr Danthanarayana admits he had not paid the leasing instalments. 
He had received a call from a man on Tuesday August 12, who sought to hire his van for a trip to a funeral in Kurunegala. As the request was convincing, he picked up the man near Hiriwala Junction the next morning.
“I was unaware that I had been led to a trap, so I drove 100 metres and was blocked by a three-wheeler. There were more recovery agents in the trishaw, and they ganged up, scolded me in obscene language and drove away with the van.’’
The Sunday Times learned the victim had tried to file a complaint at Pallewela police, yet the officer in charge had not accepted it claiming that recovery agents had filed a complaint before and after seizing vehicles.
This was one among many incidents on which police have refused complaints, siding with the leading finance companies said, Asanka Ruwan Pothupitiya, chairman of the association of leasing and debt instalment payers.
He said that after he was told of the Pallewela incident, he had to explain to the police officer in charge about the legal process and the circular issued by Deshabandu Tennakoon, the then IGP, so that the police would accept the complaint.
He said that the recovery agent (seizure agent) was produced in court on April 18 and was remanded for 10 days. The court had observed that there is no such role as a “seizing agent” and that leasing companies should follow the law.
Mr Pothupitiya said that when the second hearing was held, the suspect was remanded for a further 14 days to September 10.
He said prominent leasing companies still seize vehicles illegally despite the incidence declining.
The police media Spokesman, ASP F. U Wootler also confirmed that repossession should be done lawfully. The police should follow a circular issued on February 8, 2024 which specifies a police officer’s role during a vehicle seizure by a leasing or a finance company.
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