Firms offering debt management services to people in financial difficulty will have to abide by much stricter rules or face being closed down.

The Office of Fair Trading (OFT) is consulting on the new rules to make such firms treat their clients fairly. They will have to make it absolutely clear what services they offer and how much they will charge.

The firms must not use misleading names or adverts, and the advice given must be in the client's best interests. David Fisher, a director of the OFT, said: "This guidance is designed to leave firms in no doubt about the standards the OFT expects and what they must do to comply with the law."

"The failings identified by our recent review are unacceptable and show that debt management businesses must raise their standards or face enforcement action," he added.

Poor practice In September 2010, after an 11-month investigation, the OFT threatened to close down 129 firms, and said the industry was blighted by misleading advertising and poor advice to those in.......Click HERE to read more on this story