The Truro-based registered charity was authorised by the FCA in 2017 to carry out not-for-profit debt advice activities. It sought to provide debt advice solutions for customers in arrears on court fines, parking fines, council tax and water bills.

The FCA says that the firm has failed to comply with a number of information requests from the regulator, which is itself a breach of Principle 11, which requires firms to be open and co-operative with regulatory authorities.

There are also concerns about the quality of advice the firm provided, with the FCA suggesting that the advice process was skewed towards recommending Individual Voluntary Arrangements, regardless of whether they were the optimum solution for the customer. The firm would receive a referral fee every time they arranged an IVA.

The sales script was said to include “irrelevant and needlessly intrusive questions” and the firm didn’t have adequate procedures for dealing with vulnerable customers.

The FCA also adds that:

  • The firm could not evidence that its business model was viable, as this was dependent on it securing funding and working in partnership with local councils and enforcement agencies. In fact, the firm never obtained this funding and never entered into any partnerships of this nature
  • The firm could not show that it had adequately considered the risks associated with relying on a volunteer workforce
  • The firm failed to use any of its regulatory permissions in a 12-month period