Exposed debt company buys debtor details

According to a recent report a debt management company that was recently exposed for its bad practices by the BBC has been purchasing the details of consumers with financial troubles from a government contractor.

Euro Debt has been purchasing entire lists of people with CCJs and debts from a government contractor, and has been accused of then trying to contact the people on the list with the offer of help and then charging them extortionate fees.

Reports indicate that Euro Debt is targeting the people on the lists, with a view to re-arranging their finances and repayments, but that the consumers are actually ending up even more in debt simply because of the charges applies by the company.

The debt management company has apparently been baiting customers by stating that they can write off much of their debt, but in actual fact simply spread the debt over a longer period, which means that often even more interest is accrued.

One researcher stated: 'Debt management plans don't actually reduce the debt, they just spread it out over a longer period. So people are making lower payments but the overall debt is going up because creditors still keep charging interest. The sort of debt reduction deals negotiated by companies like EuroDebt are not legally enforceable, so the creditors can back out at any time, leaving the debtor bankrupt.'

The government contractor stated: 'Because the information is in the public domain, it is the role of Government departments and agencies to determine the public interest and review how it is used.'

A regulatory official added: 'We will study The Mail on Sunday's report carefully to consider if there is a case for tighter controls on those who have access to this data.'

Tom Smith
30.05.07