RegulationDec 18 2014

FCA hands down first redress order under credit remit

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Debt management firm Harrington Brooks will voluntarily pay over £185,000 in redress to more than 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 Financial Conduct Authority took over responsibility for regulating the sector on 1 April.

In September, the firm advised the regulator 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, the FCA said.

Customers’ creditors were not written to in a timely manner, meaning that interest and charges on their debts were frozen late and the delay meant customers were not notified that interest and charges on their debts had not been frozen.

The firm 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.

Linda Woodall, director of mortgages and consumer lending at the regulator, 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.”

peter.walker@ft.com