ACM engages with commercial debt advisers

The Dutch Consumer and Markets Authority has dealt with two companies that provided paid debt support. Their websites did not clearly state that the service had to be paid for.

After the consumer watchdog warned the companies in writing, one of the companies took down the site. The other changed the texts on the website.

This summer it became clear that both companies may have been guilty of fraud. They sold services such as budget management and protection under the heading ‘debt support’. They gave the idea that they are working on behalf of the towns.

On their websites they displayed pages by city name with information about municipal debt relief. It was not clear that the city would not contact you if you filled out the online contact form. Then you were approached by a commercial supplier.

Municipalities have a duty to offer free help to people with troubled debts. Apply for debt relief strict rules. At the beginning of this year it became a debt support provider fine by the judge because he offered paid debt support against the rules.

The two companies now being dealt with broke the rules, the ACM found after an investigation. “It’s good that a corrective slap is now being given,” said a spokesman for the NVVK, the shadow association for debt advisers. “We think this kind of practice is very undesirable.”

However, the NVVK hopes for even more action. “Debt aid should not make financial problems worse,” said the spokesman. “But I fear that this is the case with some commercial parties. It is often not clear how they earn their money.”

He mentions the Dutch Debt Rescheduling as an example. “They charge a few hundred euros in entry fees and then a percentage of the amount that is waived. This can lead to a big bill for people in debt, but it’s not clear how much .”

The NVVK hopes that the ACM will further investigate the types of revenue models and, if possible, take action.