View more on these topics

Which? finds &#39lamentable&#39 standards in debt management

Debt management companies are guilty of a catalogue of questionable selling practices and routinely flout government standards, a Which? investigation reveals.

The Office of Fair Trading produced minimum standards for DMCs in December 2001, but each of the seven DMCs questioned by Which? breached at least one of these standards.

Which? says that DMCs are failing to be up-front about their fees. It says: “Overall the standard was lamentable, with information either being non-existent or buried in the small print.”

All of the companies Which? contacted charge a set-up fee and a percentage of the monthly payment, usually 15% plus VAT. But only three of the seven companies – Accord, Baines & Ernst and Gregory Pennington – set out the initial fee clearly. DMCs should also state the full amount to be repaid, but only Baines & Ernst gave this information.

Helen Parker, editor of Which?, says: “The debt management industry is showing a shocking contempt for the OFT&#39s standards. People in serious debt are desperate and vulnerable, and it&#39s far too easy for DMCs to take advantage of that.

“In fact there are so many things that worried us that we haven&#39t been able to cover them all in our report.

“It&#39s vital that the OFT takes firm action against these companies now. We&#39re concerned that the number of people struggling to manage their debts could rise significantly if the economic climate changes.”

Recommended

The future is bright for packagers Timetable to regulation

Last year there was much speculation on the future role of packagers. This is a subject worthy of serious debate. Packagers are capable of adding significant value to any specialist lender&#39s operation and, given they can rise to the challenges, they will secure an important place in the specialist lending market of the future.Of course, […]

Planning is the key to good marketing Top tips for a successful campaign

Planning a marketing campaign carefully, particularly one involving direct mail, can make the difference between success and failure. Too often intermediaries dive straight into organising the &#39creative&#39 for a campaign without thinking about who should be targeted and, most importantly, if the activity is financially viable. There is no single correct way to plan a […]

Landlords&#39 deposits top £250m

Landlords&#39 deposits have increased hugely on the back of the boom in buy-to-let properties, though the increase was matched by a higher number of disputes over deductions. These findings are part of a survey of members conducted by the Association of Residential Letting Agents. In the final three months of last year, ARLA member letting […]

How to get your message across

Many financial advisers use advertising to help generate leads. Following simple guidelines can ensure those adverts produce more leads for less money. Using public relations alongside an advertising campaign is one of the most cost-effective ways to boost the response rate to a campaign.To be effective and make a real impact, an advertising campaign usually […]

Why prevention is better than cure

Quoting the famous adage, prevention is better than cure; there are many proactive benefits that can improve wellness in the workplace, decrease stress, increase staff morale and reduce absenteeism, as well as attracting and retaining employees of a higher standard. With a recent study showing that employees in Britain are working below peak productivity, preventative benefits can ensure you address potential health issues or causes of stress at their source and ensure productivity in the workplace remains at an optimum level. With this in mind, how are you using preventative benefits to help keep your workforce happy and healthy?

Newsletter

News and expert analysis straight to your inbox

Sign up