Offers to 'buy' consumers' debts are a scam

Consumers are being warned to avoid companies that falsely claim to be able to buy and sell on their debt. The Office of Fair Trading has alerted consumers to this danger after reports of debt and claims management companies making misleading claims to be able to take over liability for debts by purchasing consumers' credit agreements.

"Like most scams, when something looks too good to be true, it usually is, and this is certainly the case here. You cannot simply sell on your debt and its liabilities, and businesses that make misleading claims to the contrary are just trying to take advantage of consumers' distress," says Ray Watson, the director of credit for the OFT.

Legally, lenders must give permission for the sale of debt so people who are taken in by these false claims will find themselves still liable for their original debts and paying for a false service.

The OFT says it may prosecute businesses that are making these claims or those that are found operating without a valid consumer credit licence.

People can visit the OFT's online consumer credit register (www.oft.gov.uk/consumercreditregister) to check that a business holds an appropriate credit licence.

Independent Partners; Do you need financial advice on your investments, pension or insurance? Book a free consultation with an independent Financial Adviser at VouchedFor.co.uk

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