Debt scammers target Sussex (From The Argus)

Debt scammers target Sussex

1:00pm Thursday 9th July 2009

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Victims of the credit crunch are being targeted by debt scammers.

Rogue businesses are preying on people who owe money on credit cards and to banks, claiming they can clear debts in return for a fee.

Trading Standards officers are warning people to be vigilant against the scams, which could send them into even more debt.

Residents have been offered “guaranteed” unsecured loans by firms over the telephone to help ease their money worries.

They are then asked to provide a £200 fee upfront.

Trading Standards officials in West Sussex have received six complaints from people in the county who have lost money in the scam but fear there could be hundreds more who have been approached.

Rob Scovell, a senior trading standards officer, said: “Often 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.

“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.”

Trading Standards has identified five unnamed businesses operating around the country that are carrying out the scam.

Another scam offers a consumer the chance to “sell” their debt and all liabilities to a “claims management” company.

Mr Scovell said: “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.

“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 do not have consumer credit licences and Trading Standards teams across the country are working with the Office of Fair Trading to prosecute them for unlicensed trading.

There have been at least 300 complaints nationwide from people who have lost money in these scams.

Peter Evans, West Sussex County Council’s 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.”

Consumers with debt problems are advised to contact their local Citizens Advice Bureau.

Anyone who has information about the scams should call Trading Standards on 0845 4040506.

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