Watchdog slams debt firms after controversial 125-year pay-off adviceComments Off on Watchdog slams debt firms after controversial 125-year pay-off advice
In one extreme case, a desperate debtor was recommend a payment plan that would have taken her 125 years to pay off.
The FCA said the quality of advice provided by some fee-charging debt-management firms was unacceptably low. For instance, they are supposed to tell vulnerable people about free advice but one informed a customer that free advisers were “owned by the banks” and they would have “to do all the work themselves”.
“Free-to-customer” firms were slightly better but still need to improve, the regulator said.
Linda Woodall, acting director of retail supervision at the FCA, said: “People who turn to debt-management firms do so as a last resort. It is vital that they are able to access suitable advice that allows them to make informed decisions about their future. Far too many debt-management firms are not meeting the standards we expect and we will be looking for significant improvement.”