The OFT (Office of Fair Trading) reported that 35 debt management firms have voluntarily surrendered their licences to practice consumer credit while another 15 are facing action against their licenses.
Warnings were issued to a total of 129 firms as OFT reviewed the debt management sector which were only allowed until the middle of last December to take measures that would place them back in compliance with the laws.
Outside of those that gave up their licenses, an additional eight firms were told that their licences are going to be forcibly revoked and another seven are facing more investigation.
Out of the 129 firms that were given warnings, 79 debt firms were able to show they were now in compliance which the OFT is currently reviewing to assure the evidence is accurate.
Outside of taking steps to enforce compliance around debt management firms, the watchdog is also taking steps to update the guidance they offer debt management firms in order to take account of emerging and new business practices that were seen throughout the course of the review process.
Ray Watson, the director of the OFT’s consumer credit group, stated that companies that are in the debt management sector need to know that there is no question that bad practice will not be tolerated.