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Consumer Credit - an Insiders Tale

We keep hearing reports of this area of law ('get your loan written off'', 'cancel my loan if over £7,000 and under £25,000 and before 2007', 'reduce my debt', 'clear my debt for life' etc.. etc..), being the new potentially big money spinner for a lot of law firms, and have been keeping track of recent developments. A candidate has recently sent us the following feedback from working for one of the operators in this field..."I had been working for x Solicitors who are linked to a claims management firm. As I worked there it became increasingly obvious that there was a lack of independence for us to advise our clients as to the strengths and weaknesses of their claims. Many files did not have claims at all but we were actively discouraged from telling clients upfront that there was no defect in the agreement. Management asked us to advise clients whose files had weak or very poor legal arguments that their files were being sent for further investigation. This delayed refunding clients who had already waited for long periods of time for their files to be addressed.

One day in particular a couple of weeks ago I had a client on the phone screaming at me because I felt I could not tell her she was due for a refund as there was no real prospects of success. I told her it was being further reviewed. She screamed 'you're my solicitor why can't you update me'.? She was perfectly correct.

Many of the difficulties stem from the fact that the representatives tell customers that agreements can be written off or deemed unenforceable and build up false hopes. Many files come through with very poor legal basis for claims.

One argument apparently is being appealed at Court of Appeal later this year. However we were actively encouraged to pursue claims based on a case hopefully being overturned in CA.

This was a firm with poor working practices and sullies the image or profile of those firms who operate in a correct and professional way. There are genuine issues under the Consumer Credit Act but they need to be tackled professionally in order to maintain the public's trust."

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