Fears Over Debt Management Firms

There are fears for more than 100 debt management firms after the trading watchdog found multiple errors made by the firms. The 129 firms in question will now face losing their licenses.

The Office of Fair Trading has uncovered a variety of dishonest and malpractice that has taken place over a long period of time. It was found that rather than give impartial and honest debt-related advice to both individuals and families, the companies were exploiting customers in order to maximise their profits.

The firms crimes are made worse by the fact that those who come to them for debt advice are usually vulnerable and in a dire financial position.

The Office of Fair Trading has also found that many companies falsely or misleadingly advertise so that customers step into a contract under disillusion. Often this involves advertising a free service when there is a fee. Firms are guilty of indulging in a certain amount of deceit, be it cleverly disguised or blatant.

In the worst cases, groups were using misleading trading names to make it appear that they are charities or government bodies, both of which give out impartial advice for free.

The firms have been told either shape up immediately or lose your license.

By the end of this year, consumers are expected to have paid a whopping £250 million in fees to debt management companies.

All this can leave you feeling vulnerable when it comes to seeking debt advice but you are not alone. If you go through an established price comparison website, the companies you are viewing have all been researched and certified prior to you visiting their sites. This is your best bet in finding a trust worthy debt management company.

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