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Mis-sold an IVA or debt plan? Complain to the FOS - February - 2011 - Which? News
02 February 2011
An increasing number of consumers who feel they have been missold a debt solution by a debt management company are taking their complaint to the Financial Ombudsman Service (FOS), with six in 10 complaints proving successful.
Last month the Office of Fair Trading revealed that 35 debt management firms have closed and a further 15 face OFT action. A recent OFT investigation into the sector led to 129 debt management firms being warned over their behaviour towards debtors.
Increased number of debt complaints to the FOS
Consumers are increasingly complaining about poor advice, insufficient information and sub-standard service from debt management companies.
Common causes of complaint include:
If you think you have been mis-sold a debt solution, complain to the debt management company in the first instance. If it fails to answer your complaint satisfactorily, take the matter to the FOS. For more details, read the free Which? guide How to complain about financial services.
An increasing number of consumers who feel they have been missold a debt solution by a debt management company are taking their complaint to the Financial Ombudsman Service (FOS), with six in 10 complaints proving successful.
Last month the Office of Fair Trading revealed that 35 debt management firms have closed and a further 15 face OFT action. A recent OFT investigation into the sector led to 129 debt management firms being warned over their behaviour towards debtors.
Increased number of debt complaints to the FOS
Consumers are increasingly complaining about poor advice, insufficient information and sub-standard service from debt management companies.
- In the last financial year (2009/10), the FOS received 394 new complaints relating to debt management companies.
- In the first nine months of the current financial year (April – December 2010) the FOS received 335 formal cases about debt management companies, an increase of 25% on the same period last year.
- Last year the FOS upheld over 60% of the complaints it received in this area in favour of the consumer.
Common causes of complaint include:
- Consumers saying they thought they’d be ‘debt free’ and find they still have a debt remaining, after they believed it would be paid off;
- Consumers not understanding that money they paid would be taken in charges by the debt management company, before paying of the underlying debt;
- Administrative problems – for example, delays in making payments to companies who were owed money.
If you think you have been mis-sold a debt solution, complain to the debt management company in the first instance. If it fails to answer your complaint satisfactorily, take the matter to the FOS. For more details, read the free Which? guide How to complain about financial services.
