Credit firms lose licences over fees

Credit brokers have been warned to improve the way they deal with upfront fees paid by customers or risk losing their licences.
By The Newsroom
Published 12th Feb 2011, 06:00 BST

The Office of Fair Trading said it had taken action to revoke the credit licences of two associated businesses, NIZ Financial and First Money Direct, after uncovering unfair business practices.

These included taking upfront brokerage fees from consumers, often claiming loan applications had been pre-approved or approved in principle, when this was not the case, and loans were either not advanced or offered at a higher interest rate or for a lower amount than previously promised.

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They also debited customers’ credit or debit cards without their authority, and failed to refund fees.

NIZ Financial had used a trading name, Bentley Cooper, which was not on its licence, while First Money Direct had misled a customer about the brokerage services it was offering. The two companies were associates of a number of firms that were closed down by the Insolvency Service last year.