I really welcome the Office of Fair Trading’s decision, announced on April 15, to revoke the licences of four companies that were pressuring people in Individual Voluntary Arrangements into thinking – wrongly – that they had been mis-sold their IVA.
I am proud to say that my company, ClearDebt, played a major role in bringing this practice to the attention of the authorities and, with a successful legal action against the so-called “IVA Council”, helped to stamp it out.
Action against IVA Council
ClearDebt was set up because I believed IVAs were the best and fairest deal between debtors and creditors. We took this legal action, on our own and on our industry’s behalf, because we believed the IVA Council were preying on many people who were striving to deal with their debt and who had been found the most appropriate solution to their needs.
The OFT’s action shows we were absolutely right.
The OFT’s full press release can be found here: OFT revokes companies’ licences for misleading IVA mailings – but this quote covers the main points:
The OFT has found four businesses and/or their associates targeted consumers with misleading unsolicited mailings claiming the recipients may have been mis-sold an Individual Voluntary Arrangement (IVA).
As a result the OFT has revoked the consumer credit licences of Bankruptcy Limited (BL), Intl Marketing Limited (IML), UK Bankruptcy Limited (UKB) and UK Mortgage Link Limited (UKML).
The companies and/or their associates operated mainly out of the Dorset area. Some were linked to potentially misleading trading names such as ‘The IVA Council’, ‘IVA Review Board’ and ‘IVA Watchdog’. The businesses were associated with each other in various ways, including through certain common directors.
The mailings sent suggested that bankruptcy may be a better option for consumers, when this may not have been the case. Consumers accepting the advertised 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 poor quality advice and misleading nature of the mailings breached 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.
