Companies cold calling people in debt receive increased scrutiny

15th March 2011

The debt advisers in the Trust-Deed.co.uk team speak with a wide range of individuals regarding their debt problems each and every week. One of the major concerns consistently raised is their lack of confidence in the information they receive from, “a company that called me about a trust deed”.

It’s often assumed that individuals in debt contact advisers once they have made the decision to seek advice. In reality however, there are a great many companies that cold-call the individuals they believe to be in debt to sell their services. How do they obtain such personal information?

Major sources of personal information about those who may be struggling with debt are the lists kept by many loan providers and loan brokers on the individuals they have turned down for credit. This data will regularly be passed to internal or connected debt management providers. Alternatively, the data may be sold to debt advisers seeking to sell a debt plan such as a trust deed.

It’s not just debt management plans and trust deeds which cold-callers are trying to sell. Claims companies are incredibly active in this area as well, with the current ‘in vogue’ claim being for Payment Protection Insurance. There are also ‘debt elimination’ services, which claim to be able to challenge debts due to unenforceable terms in the original loan contracts. Thousands of people have paid big upfront fees for such services. Few have seen their debts eliminated.

Citizens Advice has noted the huge number of complaints they are receiving from members of the public regarding these cold-calls. Accordingly they have raised a ‘super-complaint’ with the Office of Fair Trading. The OFT must investigate the issue and report back within 90 days. If they conclude that the concern is warranted then it could decide to launch a full investigation of their own.

It seems likely that loan brokers, debt management companies, trust deed agents and claims operators are likely to find that cold-calling will be outlawed (as it already is in certain parts of the financial services sector). This will be good news for the public, some of whom are reported to receive as many as twelve uninvited calls and text messages every day.

It also seems likely that upfront fees for such services are going to come under greater pressure. The likelihood is that any such company will need to be able to specify exactly what services are covered by the upfront fees, as well as fully detailing the guarantees which are in place should the services fail to be delivered as promised.

Anyone considering a trust deed is strongly advised to ignore cold-callers. By contacting a professionally qualified adviser they are likely to save money and receive far better advice.

If you have an experience with cold callers which you would like to share, our trust deed forum is the perfect placed to air it. Our contributors share their trust deed stories, so you can learn from their experience.

Trust Deed Latest News