The OFT has released data claiming that over 60% of adverts reviewed in its survey did not meet the credit advertising rules introduced on October 31 2004.
Andrew Hagger of Moneyfacts.co.uk says: “Whilst Moneyfacts supports the action that the OFT are taking to rectify this particular situation, we feel there is a much more important issue concerning this legislation that is not being addressed.
“When the new rules were introduced, they stated that 66% of people accepted for a credit card or personal loan should receive the advertised typical interest rate. The problem here is that there is no mechanism in place for the OFT to carry out checks on lenders to ensure that the new rule is being adhered to.
“Moneyfacts has approached the OFT on two separate occasions on this issue. The OFT says that it is unable to become involved in individual disputes where a customer is offered a product with an interest rate higher than the advertised typical rate.
“The OFT say it is down to trading standards and Citizens Advice Bureaux to take responsibility for individual disputes. The problem with this strategy is that only a few consumers would take the time and trouble to complain and any issues with the rules not being adhered to will go unnoticed.
“One of the key issues here is that lenders can appear at the top of best buy charts with a low typical APR and win significant amounts of new business, without anyone verifying that 66% of customers receive their advertised rate.
“We know that many lenders have taken this legislation seriously and some will have invested money and resource to ensure they comply.
“Surely if the legislation was introduced was to protect the consumer, it makes sense to ensure that proactive checks are being carried out to ensure people are getting a fair deal.”