A commercial debt management firm has been fined, disciplined, and reported to the industry regulator by one of the industry’s main trade bodies for masquerading as a free debt advice provider.
The firm, which has not yet been identified, has provided the Debt Managers Standards Association (DEMSA) with a written undertaking that it will not advertise or promote itself in a way which suggests it offers free debt management services to clients.
It follows a hearing in front of DEMSA’s Compliance and Discipline Panel in October, where the firm, dubbed “Member X”, promised to refrain from using words such as Citizens Advice, Citizens Debt Advice, CCCS, Government Debt Help, or any combination of the four, to market its services.
Member X has also been warned that it faces suspension or expulsion from DEMSA if there is any further violation of its code. The sanctions against the firm have been reported to the Office of Fair Trading, and the firm has been fined £15,000 and ordered to pay the costs of the Panel hearing, which will not exceed £5,000.
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