Debt firms told to drop ‘misleading’ ads
Three firms that set up individual voluntary arrangements (IVAs) for people have been told to drop advertisements that make exaggerated claims for their services.
The Advertising Standards Authority (ASA) ruled against radio and TV advertisements for Accuma, Money Debt and W3 Credit Solutions which claimed that people could write off 75%-80% of their debts.
The ASA ruled that this was actually not the case with most of these firms’ customers and ordered that the ads were dropped as they were “misleading”. In future, any advertising would have to refer to a more realistic level of debt write-off that people could expect.
The decision was welcomed by consumer champion Citizens Advice. A spokesperson said: “Citizens Advice has seen cases of people being persuaded to take out IVAs when these are not appropriate, often with disastrous results.
Earlier this year the Office of Fair Trading wrote to 17 IVA firms warning them that the claims they were making were misleading and threatening to withdraw their licences to operate as businesses.
There is also increasing regulatory examination of the industry, as the number of IVA companies has multiplied in recent years because of the steep rise in people getting into serious debt and seeking solutions to it.