FCA warns of “clones’” impact on firms and consumers

One example the FCA cites is a “clone firm” impersonating the free debt advice service National Debtline, using the name ‘National Debt Helpline’.

The warning is part of a wider issue of commercial firms impersonating legitimate debt advice providers. Three weeks ago, the regulator issued a similar warning about a clone firm impersonating StepChange Debt Charity.

Almost all firms and individuals carrying out financial services activities in the UK have to be authorised or registered by the FCA. There are concerns that these organisations which are not registered with the FCA, may provide inaccurate and unsuitable advice to customers.

The FCA is also concerned that fraudsters may use this tactic when, including contacting people out of the blue.

Joanna Elson, chief executive of the Money Advice Trust, which runs National Debtline, said: “The government should give the FCA powers to regulate the wider activity of ‘lead generators’ for debt advice. These lead generators often use paid ads that appear at the top of online searches, diverting people away from free charity debt advice providers, and onto commercial firms who may include fee-charging debt management companies.

“These ‘lead generator’ companies that masquerade as National Debtline and other free debt advice providers make it more challenging for people in financial difficulty to get the free, impartial advice they need. Our concern is that these impersonators can lead people into receiving unsuitable and wrong advice at a time when they are most in need of support.”