OFT Clamps Down On Misleading Debt Advisers

Mon, 18 Apr 2011

Four misleading debt advice firms based in the UK have been shut down by the Office of Fair Trading (OFT).

The regulator has revoked the consumer credit licences of Bankruptcy Limited, Intl Marketing Limited, UK Bankruptcy Limited and UK Mortgage Link Limited after discovering that the businesses and/or their associates were targeting consumers with misleading unsolicited mailings claiming the recipients may have been mis-sold an Individual Voluntary Arrangement (IVA).

The mailings sent suggested that bankruptcy may be a better option for consumers, when this may not have been the case. Consumers accepting the advertised services would have had to pay additional fees to switch to a different debt solution that may not have been in their best interests.

The OFT said the misleading nature of the mailings and poor quality advice offered by the firms breached its OFT's Debt Management Guidance.

"The mailings sent suggested that bankruptcy may be a better option for consumers, when this may not have been the case," an OFT spokesman said.

"Consumers accepting the advertised services would have had to pay additional fees to switch to a different debt solution that may not have been in their best interests."

David Fisher, Director of the OFT's Consumer Credit Group, added: "Companies must not use misleading mailings or give advice that they know may not be in the interests of borrowers."

"Where the OFT has evidence that companies have breached its guidance, it will use its powers to stop them from doing so again."
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