As part of the OFT’s attempts to clean up the UK debt management industry, companies that provide debt management leads must now ensure that they have a consumer credit license containing the ‘debt counseling’ category. This is also applicable to anyone who acts as an introducer to debt solutions firms such as mortgage brokers, loan brokers, IFA’s, finance professionals etc.
The requirement to be appropriately licensed also applies to off-shore call centers that generate leads for UK-based debt management companies. By offering a service to UK consumers, lead generating companies need a UK consumer credit license covering the relevant debt counseling category, even though their company is based on foreign shores.
If a company is operating websites to generate leads, then all domain names must be registered and included on their consumer credit license. Not only that, but the OFT may refuse to grant a license or revoke a license if the domain names are in any way deceiving to consumers – for example if the domain names are similar to charities or fee-free providers, or if they imply that debt can be ‘written off’ or not need to be paid back at all.
The OFT is keen to clampdown on ‘copycat’ websites that sound similar to free advice agencies such as Citizens Advice, the Consumer Credit Counseling Service, the Money Advice Trust and Advice UK because these can be particularly confusing for consumers who may not notice the difference. Companies operating such websites have been described as ‘unethical’ by some observers in the industry.
The OFT has already started taking action against companies that have, in their opinion, flouted the rules. Earlier this year, the lead generation firm Money Advice Direct Ltd had to face questions from the OFT regarding its website ‘UK Insolvency Helpline’. MADL were informed that they needed to make it clearer that they were not a fee-free or charity service, and that they made money by selling on the referrals to debt management companies.
The reason for the OFT’s action is because they want debt help firms to be more transparent in their advertising so that consumers can make clearer, informed choices about who to approach for debt advice. They have also stated that it’s important that consumers understand who they are dealing with and that they can clearly distinguish between the debt solution provider and the lead generator.
Most debt management companies in the UK fully support the actions being undertaken by the OFT to clean up the industry to ensure that customers are treated fairly. They have made it clear that they will simply not tolerate ‘cowboys’ in the industry and that non-compliance with the rules could result in a £50,000 fine and the revocation of consumer credit license.
The clear message to all professionals who generate debt management leads such as mortgage brokers, loan brokers and such like is: get compliant, get the ‘debt counseling’ category added to your consumer credit license, and operate compliantly within the rules – or face the wrath of the OFT.
The requirement to be appropriately licensed also applies to off-shore call centers that generate leads for UK-based debt management companies. By offering a service to UK consumers, lead generating companies need a UK consumer credit license covering the relevant debt counseling category, even though their company is based on foreign shores.
If a company is operating websites to generate leads, then all domain names must be registered and included on their consumer credit license. Not only that, but the OFT may refuse to grant a license or revoke a license if the domain names are in any way deceiving to consumers – for example if the domain names are similar to charities or fee-free providers, or if they imply that debt can be ‘written off’ or not need to be paid back at all.
The OFT is keen to clampdown on ‘copycat’ websites that sound similar to free advice agencies such as Citizens Advice, the Consumer Credit Counseling Service, the Money Advice Trust and Advice UK because these can be particularly confusing for consumers who may not notice the difference. Companies operating such websites have been described as ‘unethical’ by some observers in the industry.
The OFT has already started taking action against companies that have, in their opinion, flouted the rules. Earlier this year, the lead generation firm Money Advice Direct Ltd had to face questions from the OFT regarding its website ‘UK Insolvency Helpline’. MADL were informed that they needed to make it clearer that they were not a fee-free or charity service, and that they made money by selling on the referrals to debt management companies.
The reason for the OFT’s action is because they want debt help firms to be more transparent in their advertising so that consumers can make clearer, informed choices about who to approach for debt advice. They have also stated that it’s important that consumers understand who they are dealing with and that they can clearly distinguish between the debt solution provider and the lead generator.
Most debt management companies in the UK fully support the actions being undertaken by the OFT to clean up the industry to ensure that customers are treated fairly. They have made it clear that they will simply not tolerate ‘cowboys’ in the industry and that non-compliance with the rules could result in a £50,000 fine and the revocation of consumer credit license.
The clear message to all professionals who generate debt management leads such as mortgage brokers, loan brokers and such like is: get compliant, get the ‘debt counseling’ category added to your consumer credit license, and operate compliantly within the rules – or face the wrath of the OFT.
UKMS Introducers work with hundreds of Loan Brokers across the UK who offer their clients personal loans, unsecured loans, secured loans, bad credit loans, payday loans etc. All loan brokers are welcome to get benefited from UKMS debt management referrals.
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