Financial Conduct Authority  

Calls for FCA powers to tackle debt scams

Calls for FCA powers to tackle debt scams

Calls have been made for the Financial Conduct Authority to regulate debt advice as the watchdog issued warnings against fraudsters targeting people who seek help.

In an update on its website yesterday (August 20) the regulator warned a clone firm was imitating free debt advice service the National Debtline by using the name National Debt Helpline. 

The FCA said fraudsters had been using the clone firm to target people in the UK, a scam tactic it said was usually used when contacting victims out of the blue using cold calling. 

The regulator said clone firm National Debt Helpline, which uses the web address, has no association with the authorised firm Money Advice Trust, which trades as National Debtline. 

The warning came three weeks after the FCA issued a similar statement about fraudsters impersonating the StepChange debt charity and has spurred action against what the Money Advice Trust called "a wider issue of commercial firms impersonating legitimate debt advice charities". 

The Money Advice Trust, the charity which runs the National Debtline, said it is working with other debt advice charities to urge regulators and search engines to take action on these kinds of scams.

The charity warned fraudsters may provide inaccurate and unsuitable advice to people seeking debt help and urged consumers to check the results of an online search before clicking on any links. 

Joanna Elson, chief executive of the Money Advice Trust, said the regulator's warning was a welcome sign the FCA was taking the issue of scammers impersonating free debt advice providers seriously.

But she said more work was needed on the issue.

Ms Elson said: "The government should give the FCA powers to regulate the wider activity of ‘lead generators’ for debt advice.

"These lead generators often use paid ads that appear at the top of online searches, diverting people away from free charity debt advice providers, and onto commercial firms who may include fee-charging debt management companies.

"These lead generator companies that masquerade as National Debtline and other free debt advice providers make it more challenging for people in financial difficulty to get the free, impartial advice they need.

"Our concern is that these impersonators can lead people into receiving unsuitable and wrong advice at a time when they are most in need of support." 

What do you think about the issues raised by this story? Email us on to let us know.