The OFT today announced a series of measures relating to marketing and charging practices used by credit brokers and debt management companies in response to concerns about their impact on vulnerable consumers.

In addition to ongoing robust, targeted enforcement action, including the revocation of consumer credit licences where appropriate, the OFT is publishing two new pieces of guidance: on the standards it expects of credit brokers, and on debt management.

The OFT is also asking the Government to consider whether new legislation is needed to address problems in the sub-prime unsecured credit brokerage market, including a possible ban on upfront fees. These measures are detailed in the OFT's response to a super-complaint from Citizens Advice, published today.

The OFT estimates that 270,000 UK consumers paid an upfront fee to a sub-prime, unsecured credit broker in the last 12 months, typically between £50 and £70, on the expectation of being offered an unsecured loan. Complaints to Consumer Direct about these upfront fees more than doubled between 2008 and 2010.

The OFT's super-complaint response suggests a number of businesses in the sub-prime, unsecured credit brokerage market, have business models based on taking upfront fees for a........Read more HERE