Govt inaction leaving public exposed to rogue Debt Management firms – Byrne

The Government is failing to protect the public from rogue companies offering debt management services, Fianna Fáil Senator Thomas Byrne has said.  It follows the revelation that the Central Bank has written to hundreds of customers of such a company urging them to cancel all payments to the company.

Fianna Fáil published the Regulation of Debt Management Advisors Bill last summer and as yet the Government has refused to take any action to progress the legislation.

“We wrote to the Minister for Finance Michael Noonan and the Government Chief Whip last summer asking that time be made available in the September-December session to debate and pass this legislation in the Dáil and Seanad to protect the public.  We’re still waiting.

The provisions of the bill are, that:

·         any business called ‘A Debt Management Advisor’ (DMA) offering these services would be subject to regulation by the Central Bank and be required to have an authorisation

·         a DMA would be required to set out all fees at the point of engagement

·         a DMA would be prohibited from handling client monies themselves

·         the Central Bank shall publish a Code of Practice concerning Debt Management Advice within six months of the legislation coming into force

·         the legislation sets out the penalties that apply to persons found guilty of an offence

Senator Byrne said: “Home Payments Ltd collapsed and this Government did nothing.  Now Central Bank has advised people who have not had their bills paid to consider contacting the Gardaí.  We cannot allow a situation to continue where people continue to be preyed on by rogue operators and the Government sits mute.  The Government should immediately bring forward a debate on the new rules for businesses involved in providing debt advice, debt management and household budgeting services.

“The Government has an opportunity to put aside politics as usual and deliver on their promise to act on good ideas from the Opposition.  The Fianna Fáil bill provides badly needed protection for the growing number of consumers reaching out to these businesses for assistance.  This is a sector that has mushroomed in recent years as personal debt levels have increased substantially.  People in difficulty need assistance, not empty promises,” concluded Senator Byrne.