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Consumer credit licence half year update

121/06    2 August 2006

The OFT has conducted 485 licensing actions in the first half of 2006.

A further 17 consumer credit licence applications were refused and three existing licences were revoked. The OFT also published 51 minded to revoke or refuse notices and issued 107 warning/advisory letters.

Under the Consumer Credit Act, businesses that are involved in consumer credit or hire must have a consumer credit licence. The OFT has a duty to protect the interests of consumers by monitoring the fitness of those holding or applying for licences.

Some of the fitness issues taken into account when revoking and refusing licences during this period included convictions for kidnapping, causing grievous bodily harm, fraud, conspiracy to supply controlled drugs, handling stolen goods, and breaches of the Trades Descriptions Act and the Consumer Credit Act.

In considering fitness, the OFT takes into account a number of factors carried out by the business or anyone involved in running the business including:

• any offence or conviction of violence or dishonesty
• failure to comply with the provisions of the Consumer Credit Act or other consumer protection legislation
• consumer complaints
• evidence of unfair business practices
• evidence of discrimination on grounds of sex, colour, race or ethic/national origin.

NOTES

1. The Consumer Credit Act 1974 requires businesses that offer goods or services on credit or lend money or are involved in activities relating to credit or hire to be licensed by the OFT.

2. The OFT can refuse or revoke a licence if it decides that a trader is not fit to hold one. Where there are substantiated doubts about a trader's fitness, the OFT issues a 'Minded to Refuse' or 'Minded to Revoke' Notice (MTR). This is a formal notice letting the trader know that the OFT is minded to refuse to grant a licence or to revoke an existing licence. It sets out the reasons for the proposed action with supporting evidence. Under s34 of the Act, the trader has the right to respond to the Notice by making written and/or oral representations to an adjudicating officer, who acts for and on behalf of the OFT.

3. Guidance for holders of consumer credit licences is available from the OFT website. The OFT has also produced sector specific guidance on debt management, second hand cars markets, and debt collection.
These detail examples of behaviour that would lead to a licensee's fitness being called into question. See press releases 48/01, 82/02 and 97/03.

4. An adverse determination (a refusal to grant a licence or the revocation of an existing licence) can be appealed to the Secretary of State for Trade and Industry.

5. The Consumer Credit Public Register is maintained by the OFT. The register documents traders that hold a licence and any action taken against them. It also details traders that have applied for a licence. Enquiries can be made to the Consumer Credit Licensing Bureau on 020 7211 8608.

6. Applications refused between 1 January and 30 June are as follows:
Impulse Motor Company Ltd, motor dealer – Reading - 566809
Michael Anthony Cluley Bolsin, dental practice – Colchester - 572160
Phillip Michael James, motor dealer – South Glamorgan – 577406
Devises Motor Company Ltd, motor dealer – Wiltshire – 568913
Mr M A Carrier, pawn/credit broker – Gloucestershire – 573154
J&P Newbury Ltd, motor dealer – Newbury – 565959
Mr Ashok Kumar Roda, financial adviser – Southall – 568696
Mr Nigel Smith T/A Financial Solutions, mortgages and secured credit – Morpeth – 572009
Gordon McRae McCulloch, motor dealer – Glasgow – 474394
Ideal Home and Improvements Ltd, home improvements – Rotherham – 566912
Nicholas David Fennell, motor dealer – Blyth – 575751
Ellite Carriages Ltd, motor dealer – Harlow – 578165
Trident Performance Ltd, motor dealer – Norfolk – 573576
Lighthouse (North West) Ltd, marketing company – Lancaster – 577266
Security Direct (GB) Ltd, financial ancillary credit business – Wolverhampton – 475381
Jason Bacon, personal computer supplier – Rotherham – 494499
Booth Furniture Ltd, furniture retailer – Strabane, Co Tyrone - 563997

7. Licences revoked between 1 January and 30 June are as follows:
Monitoring Direct Ltd, security monitoring services – Stockton on Tees - 558556
Euro Continental Cars, motor dealer – Bassett – 453115
Kenneth McKeon, financial services – Swansea - 558907

8. Licensees who have appealed decision:
Monitoring Direct Ltd, security monitoring services – Stockton on Tees - 558556

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