Beware Claims Management Companies: Consumer Alert

The Claims Management Regulator at the Ministry of Justice and the Office or Fair Trading (OFT) are warning consumers to think carefully before responding to from claims management companies that are declaring they can arrange for outstanding balances under loan, credit card and other consumer credit agreements to be written off, and secure compensation.

 Consumers are advised to seek independent legal advice before using the services of claims management companies that offer to find ways to render consumer credit agreements unenforceable.

Businesses can only provide claims services if they are authorised and regulated by the MOJ under the Compensation Act 2006. Such businesses may also need to hold an appropriate OFT consumer credit licence.

Consumers may be asked to pay large up-front fees, often up to £500, for the businesses to review their credit agreements. Some businesses are claiming that many of these agreements are completely unenforceable, that consumers can have debts cancelled and claim back thousands of pounds. Customers are then being asked to pay large fees if the claim is successful, meaning that they are still in debt.

Consumers should think very carefully before committing themselves to making claims and handing over hundreds of pounds in advance to do so, even where refunds may be promised if the claim is unsuccessful.

The best advice is to go directly to a solicitor, as they will not want to charge such excessive fees up front, and should not charge any fees at the end of your case. At Goddard Smith Solicitors we specialise in writing off debt. There are many ways to do this and by completing our free questionnaire we will be able to advise you fully about how to find out if your loans and credit card agreements can be cleared  

This entry was posted on Tuesday, September 8th, 2009 at 9:54 am and is filed under Goddard Smith in the News. You can follow any responses to this entry through the RSS 2.0 feed.