CHAPTER 5

SKIP TRACING

Explanation: Tracing of missing customers is a very common issue in collection. It is very

obvious that before the collection can even attempt to collect, you should know the exact
location or address of the debtor. A customer may be missing intentionally or unintentionally. If
his/her appearance is intentional, then credit man has really a problem.

There are at least two (2) basic approaches appropriate to skip tracing:

1. Relies on subterfuge deceit;

2. Candid and straightforward.

Subterfuge is deception by artifice in order to conceal, escape or evade the debtor. Subterfuge
requires the use of gags and gimmicks.

Candor is being open and honest

Artifice is a sense of falseness/trickery.

The best approach is a combination of both candor and artifice as the circumstances of
time, place and person may require.

Aids in Skip Tracing

1. First is the basic source of information in determining where to look for a “skip” are the
credit application, credit investigations reports and other records of the account. The ff.
are some of the various aids in skip tracing.
a. Place of employment
b. Previous employers
c. His family, wife, children, close relatives
d. Neighbors and friends
e. Trade references
f. Bank references
g. Personal references
h. Landlords
i. Neighborhood business – grocery, sari-sari, barber shops, etc.
j. Telephone directory
k. Co-makers, co-signers
l. Credit bureau
m. Different government offices or agencies, e.g.
i. Ministry of Trade/Bureau of Commerce
ii. Securities and Exchange Commission
 iii. Social Security System
iv. Government Service Insurance System
n. Different private/public utility companies/agencies
i. MERALCO or local power company
ii. Sewerage System offices (Maynilad or Manila Water)
iii. LPG dealers in a given locality

2. In addition, the skip tracer must be able to develop his own source of information:
a. LIKE Reading the obituaries, hospital notes and other reports in the local
newspaper may give some lead to a skip.
b. Cultivating friendly relations with out fellow credit men and how to approach
properly people who are in a position to know others, bartenders, waitresses,
union officials, government officials, officemates, will be greatly helpful.

There are several steps in locating a missing customer.

Procedures

1. FIRST IS YOU NEED TO Examine and study the credit information and credit
investigation reports of the missing customer by getting the various aids in skip tracing
LIKE THE enumerated above, but most particularly the following information:
a. Name and respective addresses of references;
b. Address of present place of employment;
c. Provincial address; and THE
d. Previous residential addresses.
2. After getting all the necessary data, the next step that you need to do is proceed to
conduct tracing. Generally, skip tracing consists of two stages (office, or field skip
tracing).
Proceed to conduct tracing.
Two stages of skip tracing
 Office
 Field
3. Office tracing is done by office collection clerks over the telephone.
a. SO, YOU NEED TO Contact THE latest known employer and obtain valuable
leads/information.
b. Call references (personal, trade, land bank). When their telephone numbers are
not given, consult the telephone directory.
c. Contact all co-makers/co-signers and ask for information about the principal.
Enlist their assistance in tracing the principal since they will be liable in case the
latter is not located and does not settle the account.
d. Follow-up all leads taken, if possible.
4. IF OFFICE BY TELEPHONE FAILS Field tracing, WILL BE INITIATED
IMMEDIATELY.
a. Prober will study carefully the records of the client as stated in the paragraph 1
above.
PROBER- the one who inquires/investigate the info.
b. Proceed first to the ff. places in order of the preference. Note, however, that while
the order of preferences is stated, the prober may adopt a different sequence if
warranted by the facts of the case.

(1) Address all the present place of employment.

a. If the customer is there, collect the overdue account. Inquire from the present
residential address.
b. If he is absent, inquire from the office of the personnel officer the present address
of the customer.
c. If the address cannot be secured from the office of the personnel officer because
of company rules or the address on file is the old address, inquiry must be made
from the co-employee of the missing customer and other informants, especially
the personal reference.
d. If the result is still negative, wait for the missing customer to report for work.
e. If the missing customer is no longer connected or has just started on a leave of 15
days, proceed to the next item.

(2) Respective address of the relatives, friends, and/or references mentioned by the missing
customer in the credit application.
a. Proceed first to the reference closely related to the missing customer, before his
friends or other references.
b. In the present address is located, proceed at once to the place and conduct a
residence checking. Conduct collateral inspection/appraisal.
c. Press the located customer to pay the overdue installment obligation.
d. If the located customer is not in a position to pay, discuss how settlements would
be made, FF. THE PROCEDURES IN FIELD TRACING and in case of
obligations secured by chattels, convince him to deposit the collateral temporarily
in the office of the company pending settlement of account.
CHATTELS - refers to all personal property or things you own other than
real estate for example furniture or car.
e. If the located customer cannot present an acceptable arrangement for settlement
and refuses to deposit or surrender the collateral and the latter is still in good
order and condition, recommend repossession to the Collection Supervisor.
 f. If the missing customer cannot be located after the inquiry is made from his close
relatives, friends and references, then proceed to the next item.

(3) Go to the central office of the local power company-

a. Inquire from the commercial department about the present address of the missing
customer you are trying to locate.
b. If the new address is located, proceed at once to the new address of the located
customers and follow the procedures mentioned in item (2) above,
c. If the result is still negative, then proceed to the next item.

(4) Proceed to the main office of the waterworks company or its different branches or local
water company and inquire about the new address of the missing customer.
a. The local water company has a file of water consumers.
b. If the new address is located, proceed to the said address and follow the
procedures mentioned in item (2) above. If the result is still negative-

(5) Proceed to the central office/main office or regional or local office of the Social Security
System (SSS) or Government Service Insurance System (GSIS), if the customer is a
private employee or a government employee.
a. If a private employee has resigned from his known employment, the presumption
is that the missing customer transferred to another company, in which case, he
will be reported by the new employer to the SSS.
b. If he joins the government service, he will become a member of the GSIS.

If the address is located, proceed to the said address and follow the procedures and if the
result is still negative, proceed to the next item.

(6) In case of businessmen, checking may be made with the office of the Department of
Trade and Industry/Bureau of Domestic Trade and/or Securities and Exchange
Commission.
a. The letter must be sent by Special Delivery, Air Mail, Registered with Return
Card.
b. Enclose with the letter of inquiry a separate form to be used by the chief of police
in his reply stating the correct provincial address, together with the street and
house number and other pertinent information.
c. A self-addressed envelope with the required necessary amount of stamps must be
attached to the letter of inquiry.

C. If all the above checking has negative results, steps 1-6 may be repeated after a few days or
week. It may have been taken the missing customers’ time to be included in the list of the above-
named offices/companies.
 D. Report- the skip tracer will use the prescribed Skip Tracing Report Form in submitting
his report. (The form is found under the Chapter on Forms)

Skip tracing is the process of locating people who are attempting to hide
their tracks in order to avoid paying past-due bills. Skip tracing is also important
because it can assist creditors or lenders in locating individuals who owe them
money. Furthermore, it aids in locating and validating contact information for
debtors, increasing the likelihood that a debt will be collected and, as a result,
profits.