Insolvent Brits fired OFT warning

A warning has been issued by the Office of Fair Trading (OFT) over the growing number of businesses trying to exploit the financial vulnerability of insolvent individuals around the country.

The OFT reports that a number of companies have been identifying people who have entered an Individual Voluntary Arrangement (IVA) and trying to entice them into what is often an unfavourable bankruptcy deal.

According to the OFT, marketing efforts have been targeting people who are already insolvent and whose financial position is likely to be made worse if they break the terms of their existing debt management plan.

Ray Watson, OFT director for consumer credit, said: “Tackling companies who are engaging in unfair business practices by targeting vulnerable consumers with misleading advice and information, particularly if it leads to consumers becoming more over-indebted, is a key priority for the OFT.”

Data from Credit Action has shown that one person in the UK is declared insolvent or bankrupt every four minutes.

Written by Dan Mather