1st Credit Dropped by Major Players
HBOS and CITI Financial, part of Citigroup, have dropped 1st Credit, a debt collection agency who was recently reprimanded by the Office of Fair Trading (OFT) over the debt collection methods it was using.
OFT said that an investigation had revealed that 1st Credit had failed to meet “satisfactory standards” and was ordered to stop using threats of bankruptcy to recover the money when there was never an intention to bring about bankruptcy proceedings. 1st Credit must now report to OFT every 6 months with details of the enforcement actions that it has taken against debtors, which could also mean a £50,000 and revocation of its consumer credit licence.
A spokesman for 1st Credit, speaking to the Times said “We do not comment on what we do with anyone business. We have, since late 2008, made improvements in our training and processes in all areas highlighted, and suggested proposals in response to the OFT requirements, which were accepted by them.”
Both relationships were severed after a strenuous period for 1st Credit in which it had come under fire from Citizens Advice, Consumer Credit Counselling Service and Consumer Direct for a large increase in complaints about its overly aggressive intimidation tactics in chasing debts.
These complaints were reviewed as part of an OFT investigation that led to an official sanction in February. The loss of two large and prestigious clients will be a blow to a company that has been thriving in a declining economy.