Debt management firm Harrington Brooks to pay redress to 4,500 customers, says FCA
Published: 18/12/2014 Last Modified: 18/12/2014
The Financial Conduct Authority (FCA) has announced that debt management firm Harrington Brooks will voluntarily pay over £185,000 in redress to over 4,500 customers after communications from the firm to creditors on customers’ behalf were delayed.
Harrington Brooks is the first debt management firm to agree a redress package since the FCA took over responsibility for regulating the sector on 1 April 2014.
Linda Woodall, director of mortgages and consumer lending at the FCA, said:
“Debt management customers are struggling financially and often in difficult situations so it’s important that when people are putting their trust in a firm, they get the service they have paid for.
“When things go wrong we expect firms to put them right for their customers and we are pleased that Harrington Brooks is working with us to do this.”
In September 2014, Harrington Brooks advised the FCA that communications with some customers’ creditors had been delayed, meaning customers may have been left with the impression that the firm had been in contact with creditors when it had not. The delay resulted in some people owing more in interest and charges than if the firm had contacted creditors sooner.
Customers were affected by the delays in two ways:
- Customers’ creditors were not written to in a timely manner, meaning that interest and charges on their debts were frozen late,;
- Customers were not written to in a timely manner following the outcome of the Harrington Brooks’ negotiations with creditors on their behalf. This delay meant that customers were not notified that interest and charges on their debts had not been frozen.
Harrington Brooks has cooperated with the FCA’s requests and will be writing to affected customers in the coming weeks to explain the situation and advise them of any redress that is due. Customers do not need to do anything, and should wait to be contacted by Harrington Brooks.
Notes to editors
- In September 2014, the FCA said that it had concerns about aspects of the debt management sector, in particular, that they demonstrate they provide appropriate advice, do not charge unfair fees, and have adequate processes for handling client money.
- In May, the FCA released research on the debt management sector.
- On 1 April 2014, the FCA became responsible for the regulation of approximately 50,000 consumer credit firms. For further information see our consumer credit pages.
- The Money Advice Service provides free and impartial information that can help people get on top of their debts.
- On the 1 April 2013 the Financial Conduct Authority (FCA) became responsible for the conduct supervision of all regulated financial firms and the prudential supervision of those not supervised by the Prudential Regulation Authority (PRA).
- The FCA has an overarching strategic objective of ensuring the relevant markets function well. To support this it has three operational objectives: to secure an appropriate degree of protection for consumers; to protect and enhance the integrity of the UK financial system; and to promote effective competition in the interests of consumers.
- Find out more information about the FCA.
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