Debt management companies may have to pay clients compensation for selling services without considering their financial position and for other misleading practices, after a damning report by the financial regulator.
The Financial Conduct Authority also said yesterday that some may also fail to gain authorisation to continue to operate, forcing them to close.
Publishing the results of an industry investigation, the FCA found that debt management companies routinely treat customers, especially vulnerable members of society, unfairly. The regulator said that the results of a review had been “very disappointing”.
Five of the eight businesses investigated have been told to appoint “skilled persons” under the FCA’s Section 166 compliance powers to provide a fuller account of their practices. The regulator said that the findings were so