OFT investigate ways to suspend credit licences

The OFT (Office of Fair Trading) has started a new consultation to look at new powers that will allow it to suspend the consumer credit licenses that belong to debt purchasers, debt collection agencies, and other similar firms immediately.

The OFT stated that it needs the power in order to protect its consumers fully by allowing them to quickly stop licensable activities of businesses that otherwise will continue to take advantage of customers throughout the appeals process. As part o the exchange, the regulator will only be able to immediately suspend licenses if there is an urgent need to protect consumers.

These cases are defined as instances when there is evidence that consumers may come under physical harm or are threatened to be harmed. Some of the factors that the OFT will consider when making a decision about whether to suspend a license or not includes whether the business has taken part in dishonest practices, violence, or fraud.

Other factors that might influence the OFT’s decision to immediately suspend the license of a trader include a failure to address the previous concerns that may have been issued to the business by the OFT or failure to address concerns from a partner organization such as the Local Authority Trading Standards Services.

Director of credit for the OFT, David Fisher stated that this is a very vital power for the OFT that will allow them to quickly take care of problems with businesses that serve a serious and immediate risk to consumers.

He added that they will consult with interested parties first before taking any action but after they are granted the power they expect to use it in serious cases when they need to protect people. The consultation will take 12 weeks to complete with the new power expected to be available in Spring of 2013.