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OFT warns of 'selling on debt' claims
Businesses are falsely offering to buy consumer debt from people, prompting the Office of Fair Trading (OFT) to issue a public warning.
Consumers are being warned that companies who offer to 'buy' their debt, and take on the liability for it, cannot legally do so.
A debt cannot be sold on without the lenders permission according to the law, and the OFT says that companies claiming they can buy customer's debts are "misleading" consumers.
Those consumers who do 'sell' on their debts will still liable for the original payment obligations and lose the money they paid for the false service, say the OFT.
The OFT claims there has been an increase in the number of adverts on the internet and in newspapers from companies making such claims.
Ray Watson, OFT Director of Credit, warned that if something is too good to be true, it usually is.
He said: "You cannot simply sell on your debt and its liabilities, and businesses that make misleading claims to the contrary are just trying to take advantage of consumers' distress."
According to a new report there has been a 16 per cent increase in people with 2 or more debt issues since 2006, as well as a 320 per cent increase of the average.