Four firms which targeted consumers with misleading information about debt have been shut down by the Office of Fair Trading.
The regulator (OFT) found that the four businesses, which were associated with each other in various ways, had targeted consumers with misleading unsolicited mailing claiming that they may have been mis-sold and Individual Voluntary Arrangement (IVA).
Bankruptcy Limited (BL), Intl Marketing Limited (IML), UK Bankruptcy Limited (UKB) and UK Mortgage Link Limited (UKML), have all had their consumer credit licences revoked after sending mailings which suggested that bankruptcy may be a better option for consumers, when this may not have been the case.
Consumers which accepted the services would have had to pay additional fees to switch to a different debt solution that may not have been in their best interests. As such, the firms were in breach of the OFT’s Debt Management guidance.
BL and IML appealed against the OFT’s decisions. The revocations of their licences took final effect when IML’s appeal was struck out by the appeal Tribunal in March 2011 and BL withdrew its appeal in March 2011.
David Fisher, director of the OFT’s Consumer Credit Group, said: “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.”‘