Debt scams warning by West Sussex trading standards officers

A strong warning about debt scams has been issued by West Sussex trading standards officers.

They said dodgy businesses were seeking to make a quick and often illegal profit by targeting the increasing number of people in the county who might be experiencing money difficulties.

And they warned that two scams were being operated.

In one, residents receive a telephone call offering a

'guaranteed' unsecured loan to help ease money worries '“ all the consumer has to do is pay a 200 or so fee up front.

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"Often, however, no loan is arranged and the customer is told the fee is non-refundable.

"This is not true '“ in fact, the company has a legal obligation to refund all but 5 of the fee paid," said senior trading standards officer Rob Scovell.

"If the company does not refund the money, the consumer has the right to recover the money in court, but this can become a complicated process."

In the second scam, a customer is offered the chance to 'sell' their credit agreement debt and all liabilities to a 'claims management' company.

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"It sounds very attractive, but has no basis in law and the consumer can end up paying a hefty fee for the 'purchase' while retaining full liability for the debt," said Mr Scovell.

"Consumers will also still be subject to any debt collection activity and negative credit scoring associated with the original debt."

Some of the firms offering these services did not have consumer credit licences and trading standards services across the country were

working with the Office of Fair Trading to prosecute them for unlicensed trading.

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Cllr Peter Evans, the county cabinet member for public protection, said: "Like most scams '“ when something looks too good to be true, it usually is.

"This is certainly the case here.

"You cannot simply sell on your debt and its liabilities.

"Businesses that make misleading claims to the contrary, or refuse to refund arrangement fees, are just trying to take advantage of

consumers' distress."

He added: "Consumers with debt problems should contact their creditor to arrange a repayment plan or their local Citizens' Advice Bureau which will be able to provide free advice."

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