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Debt management firms reminded of annual review requirements
Debt management firms reminded of annual review requirements
This is a duplicate of the Blog Entry made on: 8th December 2016 15:49
This is a duplicate of the Blog Entry made on: 8th December 2016 15:49
FCA sent a letter to CEOs of all debt management firms due to concerns with the way firms are carrying out annual reviews.
All DMPs must be reviewed at least once a year.
If a customer does not cooperate with a review or respond to requests for information, the firm must take reasonable steps to encourage the customer to engage with the review process. Firms cannot just conduct a ‘desk-based review’ based on old information that is increasingly likely to have become inaccurate over time. Where a consumer continues to not engage with a firm and the firm cannot be confident from the information that it holds that the plan remains appropriate to the consumer’s financial circumstances, it may be sensible for the firm to consider lawfully ending its involvement in the consumer’s debt management plan. Advice provided during an annual review must be given to the customer in a ‘durable medium’. This means that if advice is given on the phone, written confirmation must be sent to the customer. We may take further action if a firm does not comply with the expectations and rules set out in our letter. We can also take this into account when we review a firm’s application for authorisation.
Advice to consumers with DMPs
We have taken this action to ensure consumers who have a DMP receive appropriate advice and have a debt solution which is suitable for their needs.......Read more from FCA Website HERE
All DMPs must be reviewed at least once a year.
If a customer does not cooperate with a review or respond to requests for information, the firm must take reasonable steps to encourage the customer to engage with the review process. Firms cannot just conduct a ‘desk-based review’ based on old information that is increasingly likely to have become inaccurate over time. Where a consumer continues to not engage with a firm and the firm cannot be confident from the information that it holds that the plan remains appropriate to the consumer’s financial circumstances, it may be sensible for the firm to consider lawfully ending its involvement in the consumer’s debt management plan. Advice provided during an annual review must be given to the customer in a ‘durable medium’. This means that if advice is given on the phone, written confirmation must be sent to the customer. We may take further action if a firm does not comply with the expectations and rules set out in our letter. We can also take this into account when we review a firm’s application for authorisation.
Advice to consumers with DMPs
We have taken this action to ensure consumers who have a DMP receive appropriate advice and have a debt solution which is suitable for their needs.......Read more from FCA Website HERE