The Office of Fair Trading (OFT) is clamping down on unsecured credit brokers and debt management firms over concerns about how their marketing and charging practices affect vulnerable consumers.

The regulator is particularly concerned about upfront fees charged by sub-prime, unsecured credit brokers, which consumers pay expecting to receive a loan in exchange.

Some brokers are charging upfront fees between £50-£70, and not refunding customers who subsequently do not receive loans, according to the OFT.

In the last year 270,000 UK consumers have paid these fees, and between 2008-10 complaints made about them to Consumer Direct have more than doubled.

Following a super-complaint by debt charity Citizens Advice, the OFT has published new credit brokerage guidance for consultation, stipulating that consumers may be entitled to a fee refund where no introduction to a lender is made, and that the OFT expects brokers to advise consumers who do not enter a relevant agreement of their statutory right to a......Click HERE to read more