Citizens Advice launches DMP provider partnership with CCCS

National charity Citizens Advice is today pleased to announce that after a competitive tender process the charity Consumer Credit Counselling Service (CCCS) has been selected as the CAB service’s preferred debt management partner for a one-year pilot scheme involving up to 100 bureaux.

The partnership will enable bureaux to introduce clients who need to set up a debt management plan to CCCS as a trusted partner.

The pilot will see CAB clients continue to receive an impartial and complete debt advice service from their bureau and continue to be advised about all the debt remedy options available to them.

For clients who choose to set up a DMP through CCCS, the bureau will automatically transfer the client's records to CCCS who will then negotiate with creditors, set up the DMP for the client and manage the client debt portfolio.

A recent report from the Office of Fair Trading has highlighted that the choices that consumers make to settle their debt problems can have serious consequences on availability and cost of future credit. The partnership will play an important role in helping vulnerable consumers deal with complex and harmful financial problems.

Gillian Guy, Citizens Advice Chief Executive said: “Citizens Advice Bureaux are currently dealing with 9,500 new debt enquiries every working day. But clients who need, and choose, to use a debt management plan provider face an increasingly complex market in terms of the number of potential providers, the services they provide and how to identify quality providers.

“This partnership with CCCS as a trusted supplier will give clients the reassurance of a DMP provider that has been carefully assessed and selected. Our tender process set high standards for quality of advice, customer service and synergy with Citizens Advice’s aims and values. CCCS, an established provider of DMPs, demonstrated their resounding commitment to our aims and a shared vision of a constructive and innovative partnership for the benefit of indebted clients.

“We hope that the partnership will set an industry standard to offer consumers a genuine opportunity to access free, quality debt advice that will help and motivate them to resolve their debt problems.”

Malcolm Hurlston, Chairman of CCCS said: "Working together, CCCS and Citizens Advice can transform the landscape for people in debt. "Debt management plans, which CCCS introduced to the UK in the early 1990s and which over 100,000 of our clients are now using, are vital in helping people sort out their personal finances and learn about the need to organise monthly payments.

"Two principles are clear: first, people in debt should not have to pay for help. Secondly, they should be able to use the channel they prefer - and which will work best for them.”

"Allying Citizens Advice Bureaux pre-eminence in face to face advice to the skills we have developed on the internet and using the telephone will make it likely that together we can offer the right service to all who need us.”

The award is subject to final contractual details, but CCCS will help Citizens Advice with the set up costs to improve client experience and increase capacity.

The Future Depends on Due Diligence

The inevitable is just that - inevitable and as received wisdom has it that the only two certainties in life are taxes and death, I suppose I'll have to acquiesce. That said, I've yet to come across anyone who has cheated death, but I rather think over the years I may have shaken hands with one of two individuals who have succeeded in cheating the former.

Which brings me neatly to the Spending Review. I couldn't put finger to keyboard until we at least had a skeleton of what the future holds. To a large extent, the Treasury being the sieve it has been in latter years,we already had many of the bones, and what bones that were added merely served to fill in the gaps.

I've spoken to friends and colleagues and not one disagrees that a sick economy needs medicine ... possibly even some element of surgery. I suspect that in the last months of the previous administration, they had attempted to staunch the flow with bandages.

Will Messers Cameron and Clegg pull it off? They just might. They've managed to keep Vince Cable on message despite all of the u-turns he has been forced to make. Kenneth Clarke is once again a voice to be taken seriously and those reassuring rounded Yorkshire soundbites from William Hague have ensured that the coalition front bench is manned by heavyweights despite the lack of experience in Government of the two leaders.

Which is all at odds with what has happened in Banking and Industry at large since the early 1990's. Then, age and experience was rejected in favour of the thrusting bright new things who would shake up the system as never before. And they certainly succeeded in that! However, having never experienced a recession, let alone a depression, come "Lehman-Gate" they were caught like the proverbial rabbits.

Former President Honoured with Lifetime Membership

The Credit Services Association (CSA), the voice of the UK debt collection industry, has honoured one of its former Presidents - Godfrey Lancashire - with Honorary Lifetime Membership following the announcement of his retirement from the CSA Board.

In a presentation at the CSA Gala Dinner in September, current CSA President Roger Lucas spoke of Godfrey's considerable contribution to the collections industry, notably as a strong advocate of proactive media communications that had helped improve the public face of collections nationwide:

"In his term as President many of us looked forward to his speeches, not just for the informed and interesting content, but also for his delivery," Roger says. "They were always eloquent and never boring! This eloquence, backed by a quick thinking intellect, was made full use of by the CSA in asking Godfrey to respond to many requests for interviews on radio and TV.

"Not many trade association representatives get anything from Nicky Campbell on the BBC's prime time consumer program 'Watchdog', but Godfrey clearly won the man's respect and in so doing made most of us feel proud, and advanced the image of the collections industry in the minds of many."

Dr Lucas said that Godfrey's work included representing the CSA in numerous meetings with MPs and Ministers, and ultimately influencing Westminster opinion: "We may never know what the value of such meetings may finally deliver," he concludes, "but we are completely certain of the value of Godfrey's contribution to our Industry, as a real giant."

Although retiring from the CSA Board, Godfrey will continue as the managing director of his own tracing and investigations business, London House International.

The Score!

The Score magazine

You will shortly be receiving the latest edition of our quarterly publication, "The Score", which we hope you enjoy. There is a link which will also give you access to the last four back issues.

Do please feel free to contact us with your comments and, as always, many thanks for your continued support of London House.

In the meantime, I would like to take this opportunity to wish  you a Very Happy Christmas and a Prosperous New Year from all of the team at London House.

Godfrey Lancashire.

London House news [Dec. '10]

We have now held our annual Franchise Owners' Conference in the wonderful surroundings of Whittlebury Hall, Silverstone. This event grows every year, and this year was no exception. Many of our Franchise Owners joined us (those that could not were completing repossessions, undertaking surveillance, or snow bound!) and we listened to some excellent speakers in the morning who were clients and friends of London House. Our thanks go to Parry & Co Solicitors, Concateno Drug Testing Services, The Credit Services Association, Forensic Vetting and Derek Arden for their support.

The afternoon was given over to London House matters and an opportunity to share best practices and discuss the continued growth of London House.

Of particular note is the award of Franhise Owner of the Year, voted for by the Franchise Owners themselves. This year the award went to Dave Williams of Central London for his continued support and help given to the whole network. Well done Dave, it's very well deserved.

Godfrey Lancashire

Can we have our money back please?

London House had a case recently where our hunches, skills, determination and "dog with a bone attitude" paid off for our client.

We were instructed by a client to trace a subject who it was believed had committed cheque book fraud in excess of £1m. Our searches led us to find several linked addresses to the address provided, and one address in London was of interest to us. Attending discreetly at the address we obtained information that led us to believe there was a lead to follow in Spain. Spending time in Spain we ascertained that the subject had established residence there and continued enquiries in the area finally took us back to two additional properties in London that our client had no knowledge of. This subsequently led to our client securing legal charges over both assets and put them in a position to negotiate a full and final payment.

Focus on... Debt or Asset Recovery

Increasingly we are being asked to help clients recover commercial bad debts or to locate assets that they may not have been aware of. Our Franchise Owners always attend at the address of the debtor on behalf of our client and negotiate in a skilled, professional manner to recover overdue invoices. In the event that the debtor proves reluctant to pay, we are able to advise on the best way forward for that particular case.

We can also be asked to try and locate assets that the debtor may have "hidden away" such as property or machinery. Whilst always operating within the Law we complete our instructions discreetly and report back to our clients. Our report will provide them with details of our findings and help to paint a picture of the subject's lifestyle.

Debt or Asset Recovery

Football's coming home?

Well what can we say, except a resounding No, or should that be Het.

Despite being given verbal assurances of enough support to get us through to the last round of voting those votes failed to materialise.

Not even the attendance of our own three lions for the last days bouts of diplomacy were enough to get us past the first round of voting. Two votes - one of which was our own! Gutted!

Milton Keynes and the rest of the country look on in astonished amazement. We had the best presentation, the best technical bid, the best commercial case. Tales of fraud and corruption will occupy the press for months to come. We know some good investigators!

... last month gone!

It has been an interesting month with lots happening, not least the snow and ice which has gripped our shores, and now Christmas is just around the corner. Where has the last month gone!

We hope you enjoy the following but please do let us know if there is any industry related matter you would like us to cover in future editions.

The Credit Insurance Market Place

by Tony Hannigan

There has been a considerable change in risk appetite and flexibility during the last 12 months. Anecdotally at least, 2009 was the most difficult trading year the credit insurance market has ever experienced, if in reality it was worse than the recessions of the 70’s, 80’s and 90’s when comparing claims costs on a like for like basis is questionable.

However, what cannot be argued with is the dangerous combination of increased claims activity in both number and value of claims submitted, very low premium spends and a general exodus of policyholders deciding to self insure which the market sustained in 2009.

This combination left the market with an imbalance between revenue income and potential liability. This could only be controlled by implementing a programme of reduced credit limit coverage on buyers and in many cases withdrawing cover completely. At policy renewal, increasing premium rates and restricting policy flexibility was the norm. This renewal philosophy across the entire Market made any attempts at innovation and flexibility extremely difficult.

Coming into 2010 the market has contracted considerably. Individual insurers have not formally publicised the true impact of lost business due to their underwriting approach, but is fair to say it has been significant. Claims numbers across the market during 2010 have been considerably lower than expected. Indeed the performance to date of the major credit insurance underwriters all re-affirms this.

Whether this is due to an actual upturn in the economy, or the result of a reduced policyholder base producing less over all claims numbers and avoidance of claims due to credit limit reductions and cancellations, is difficult to gauge at this time. What is far easier to gauge is the considerable upturn in the market’s appetite for retaining existing policyholders and to win new business. This is reflected in both buyer risk underwriting, premium costs and policy structure flexibility. There is experience of clients being offered up to 8 separate insurers, all vying to win their business at this renewal, whilst only the incumbent underwriter was prepared to offer any terms at all in 2009.

Furthermore cover appetite on some well known buyers has returned too. In 2009 there would have been no or very little cover available on the likes of Ford Motor Company, Jaguar Land Rover or Clinton Cards, cover has now returned, subject to the overall attractiveness of the specific case to underwriters.

This shift change can only benefit existing credit insurance purchasers and new entrants to this type of cover. There are also some signs of innovation returning to meet prospective clients needs. In particular, Towergate Credit has recently launched a new credit insurance product aimed at the sub £350,000 SME market. A sector that now has to all intents and purposes been unable to purchase cover due to the relatively high entry premium costs (c£3,000) and excess deductibles of £500 - £1,000 per claim that reduce considerably the benefits of cover. Towergate’s new product branded InvoiceProtect has a fixed £1,870 premium, £250 excess deductible and simple administration requirements.

For more information, please contact Tony Hannigan,

Senior Account Handler Complete Commercial

on Direct Dial - 01908 693210

or Email Tony at tony.hannigan@towergate.co.uk

or visit www.towergatemiltonkeynes.co.uk

The first 15 years of London House

1995 - what a different world then - no sat navs, just a good old A to Z and with Godfrey riding shotgun and colleague director and co-founder, Brian, driving, the intrepid duo covered the whole of the UK, never letting a client down and delivering all work on time. Back at HQ was Marjorie Woods, still our PA to this day, who joined us on day one, answering calls, issuing instructions to us, even helping to open the flat pack furniture in our first office!

Our first clients certainly showed faith in us and included Abbey National, Alliance and Leicester and Allied Irish Banks (a good marketing plan to start with the As) and I'm delighted to say they still remain valued clients, although the first two are now, of course, under the Santander brand. Today we have 220 national clients using our head office on a regular basis and many hundreds more using our network of franchised owner/managed offices locally throughout the UK.

Our network has grown steadily from 20 offices back in 2001 to the current 63 postcode territories covered from Glasgow in the north to Exeter in the south-west.

And what a difference new technology has made, not just sat navs to help us in the field but system driven automated distribution of work, the power of the web to aid investigation, emails on the move and photos flashed around the world in seconds.

We would not have been able to achieve this growth and our position in the market place without our loyal staff: Marjorie, whom I mentioned, Mark Blaber - our Business Development Director, Dee Kennedy - now with us for over 14 years, who previously worked in the administration department of New Scotland Yard, Sarita Chopra - previously in Thames Valley CID, Jacquay Oldham and Sally Culley. Our thanks to you all.

Two years ago we re-branded as London House International and have seen a steady growth in overseas instructions, both investigating debtors escaping the UK and from international clients needing our services here or further afield.

What else has changed? Well, legislation has changed, of course, there is more regulation and bureaucracy but one thing has remained constant - the need for our field based investigation services and validating information that databases simply cannot do - Do we trust that returned envelope that says "Gone Away". Throughout this period we have been pleased to play an active part in our two trade associations, the CSA (Credit Services Association) and the BFA (British Franchise Association) and we have developed excellent relationships with our professional advisors, not least our lawyers, Geoffrey Leaver LLP, our bankers, Nat West and our franchise consultant, Gordon Patterson from FDS, all of whom have supported us since the very beginning and, more recently, our accountants, Mercer and Hole.

And so, what lies ahead for the next 15 years - pensions for some perhaps, a paperless office, completion of our UK network and then London House International Spain, Australia, USA? (Now, there's a thought).

And finally, our sincere thanks to all our clients and friends. We really do appreciate your continued and valued support.

by Godfrey Lancashire and Brian Hughes

Milton Keynes to host World Cup?

You may not know that Milton Keynes began celebrating last December when it was named as a host city for the 2018 World Cup should the England bid be successful. If England win the bid, the MK Dons stadium will host World Cup football and one of the teams will be based in the city. This is a huge success for Milton Keynes, placing the city alongside other successful venues such as London, Manchester, Birmingham and Liverpool.

The result appears to be narrowing to a choice between England and Russia and we now wait with bated breath for the World Cup decision which will be announced on 2nd December. The Champagne is chilling nicely!

A knock on effect of hosting the World Cup is likely to be a huge increase in the number of attempted frauds and criminal activity. The fraudsters see the games as an opportunity but London House stands ready to help with fraud prevention and the recovery of any losses.

Focus on... Tracing - locating gone away debtors and hidden assets

Our strength is our field force of regional managers (Franchise Owners), all of whom are skilled and experienced in the art of tracing. We differ from many traditional agencies in that we do not rely purely on database enquiries... why have a field force and keep them shut away! Our managers always attend at the last known address of the subject and begin their enquiries by speaking to occupiers, neighbours, etc. always discreetly and always within current legislation. We follow the trail, wherever it may lead, and keep going until we have an answer. We are succesful in the majority of cases and there is a certain amount of satisfaction, for us and you, in our finding that person that just didn't want to be found.

Fraudsters traced and taken to court

London House were asked recently to confirm the residence of a male subject who we believed to be using different names in an effort to hide.

Our trace enquiries began with a series of telephone and database investigations before we visited the subjects property discreetly so as not to alert the occupiers.

 At the address we were met at the door by a lady who confirmed her identification as Mrs X and that she lived at the address with her husband Mr Y (a different surname) and her son, Mr Z (a further surname). We confirmed our understanding with Mrs X and told her we would call her if we needed any further information. We telephoned later and she again confirmed her earlier comments. When asked about middle initials she supplied those for her husband and her alleged son. These matched the details we had discovered on databases. Our investigations had also confirmed that both adult male names had the same date of birth.

Reviewing the information supplied by our clients and the results of our own investigations, we were firmly of the opinion that the two males with different surnames were in fact one and the same person. Our suspicions were confirmed when Mrs X phoned us later, after a period of reflection perhaps, to ask how we knew to call at her address as only the surname Y was used on records and documentation. We were able to supply our clients with a detailed statement suitable as evidence in court.

Mrs X and Mr Y have been found out. As investigators we know to never assume that things are as they seem.

London House news [Nov. '10]

As ever, it is a busy time at London House. We have just finished training a new franchise owner (Marc Borgia in East Surrey & Mid Sussex) and we are delighted to say he has successfully passed his exam.

 When a new franchise owner joins us, they visit us at our Head Office for a 2 week residential training programme. This is a very comprehensive course covering all aspects of the work that we do, the Court system, Data Protection, and the law, amongst many other areas. This training culminates in a written exam (which the new franchise owner must pass before we sign them off). In the meantime, we ensure that they have in place the necessary insurances, register for Data Protection, obtain a Consumer Credit Licence and become a member of The Credit Services Association (thereby working to a published Code of Practice).

We are also quickly approaching our annual Franchise Owner Conference which will again be held in the wonderful surroundings of Whittlebury Hall. Each year our franchise owners join us to hear presentations from clients and industry experts, share best practices and keep up to date with developments at London House.

Godfrey Lancashire

Access to Credit Reports

Consumers can now access their statutory credit report online for a nominal fee of only £2 from all three major UK credit reference agencies: Experian, Equifax and Callcredit.

An agreement between the Department for Business, Innovation and Skills and the industry means consumers will now have easier access to their credit reports.

Continued free access to credit reports for victims of ID fraud and the financially vulnerable has also been secured by the government.

Credit reference agencies and consumer groups have committed to work together to raise awareness of the importance of checking credit records.

Consumer Minister Edward Davey said: “These are highly beneficial changes. All consumers now have easier access to their £2 statutory credit reports, with victims of ID fraud and the financially vulnerable receiving free access to their reports. These significant improvements will help consumers take better control of their finances.”

Postcode Insolvency

R3, the insolvency trade body, has published a ‘bankruptcy map’ revealing the regions and local authorities that have seen the highest proportion of new personal insolvency cases.

The bankruptcy map which looks at the number of new bankruptcies and Individual Voluntary Arrangements (IVAs) that occurred in England and Wales shows that the likelihood of becoming insolvent was almost seventy percent (69.5%) higher in the North East than in London. 

There were almost six thousand (5,923) new personal insolvency cases in the North East which means that for every ten thousand people, 29 of them became insolvent.

The figures indicate that people who live in London are least likely to go into a formal insolvency procedure. The average number of new cases in England is 24.3 per ten thousand - in London there were 17.1 new personal insolvency cases for every ten thousand people.

R3’s President, Steven Law commented: “Prior to the recession, the North East had a higher than average unemployment rate and the region’s construction industry was badly hit during the economic downturn so it is understandable that personal insolvencies are more common there.

Londoners are least likely to become insolvent as there are more employment opportunities in the region. Unfortunately, with the announcement of public sector job cuts, it is likely that the figures will worsen, especially in areas such as the North East where public sector employment is high.”

The top ten insolvency hot spots (new personal insolvency cases per 10,000):

• Torbay, South West (45.8)
• Kingston upon Hull and the Humber (40.7)
• Lincoln, East Midlands (39)
• Plymouth, South West (38.8)
• North Tyneside, North East (37.4)
• Gateshead, North East (37.1)
• Corby, East Midlands (37)
• Hastings, South East (36.9)
• West Devon, South West (36.9)
• Thurrock, East Anglia (36.7)

"Startled rabbits in the headlights of an uncertain future"

I’m not alone. Given the chance, wouldn’t we all like to predict the future. And in the last issue of the Score, it would appear that is exactly what I did. I suggested that the worst all results would be a hung Parliament.

So am I trying so say there’s no political solution to the mire we are all wading through? I suppose I am. Do I think the radical policies of the current administration will achieve the projections? I honestly don’t know.

What I do know is that we’ve been digging this hole for going on 20 years, working on the basis that as long as profit exceeded default and property prices continued their upward spiral, we could sustain lending levels and remain in the comfort zone we’ve built for ourselves in that period.

Due diligence, fiscal proberty, responsible borrowing and lending ... all phrases we associate with the halcyon days of banking before the brakes were taken off in the late eighties and the throttle opened up fully when Gordon Brown’s first act in office was to give the Bank of England self governance, including interest rates.

Unfortunately, gone are the generations that fully understand the meaning of such phrases. They are now being trotted out as soundbites for a public desperate to believe that the solution to all our woes lies with a Government that is full of good intentions and populist policies.

Government can only legislate. In other words, put the brakes back on, which appears to be exactly what the Budget and subsequent announcements presage. Was the FSA the sacrificial lamb, or the author of it’s own demise?

That debate will run and run.What is certain is that the banks are as startled rabbits in the headlights of an uncertain future.

To all intents and purposes they’ve stalled.Despite all the guarantees, they are still nervous. Alistair Darling’s attempt to fuel recovery have by and large come to nought. Loan to Value rates remain fixed, businesses in particular are finding access to credit scant to say the least,and even the banks themselves seem reluctant to instruct collection and investigation agencies to the extent they once did.

Like many of their customer base, they too are adopting the ostrich stance. They don’t want to look into their portfolios because they already know that they will very definitely not like what they’ll see.

Perhaps the most unacceptable outcome of the last two years is that it was greed that engendered the recession, and it will probably be greed that starts any recovery.

However when that will be is anyone’s guess.That fabled double dip is now making its presence felt - the black dog on the end of the bed, as Winston Churchill described his depression.

by Godfrey Lancashire

Personal Debt approaches £1.5 trillion

Personal debt is now standing at £1.46 trillion according to Credit Action, the debt charity.

However, although the amount appears on the surface to be yet another eye-watering statistic, the figure covers £1.23 trillion which is secured against property (this property stock stays fairly steady at about £6 trillion ... over 4 x the indebtedness). Also, the headline figure went up by 1% year on year.

Current figures have kicked out an average debt per capita of just over £8,750 (excluding mortgages). Including mortgages, that figure shoots up to just under £58,000.

Current forecasts hint at a figure in excess of £113,000 by 2015. For the 11 million mortgagees out there, they owe an average £30,000 representing 126% of annual income. Perhaps more worrying, the average household personal debt on credit cards, personal loans - ie unsecured finance stands at £4,500. Extrapolate out households without any unsecured debt and that figure grows exponentially. We can’t be complacent.

Most European countries, even those in crisis, do not have personal debt figures of this order. Bear in mind the already flagged up public sector redundancies and the inevitable knock on into the private sector, and a 1% rise can be seen as a target, but the eventual figure could be considerably higher.

Cheque payments winding down

The Payments Council have set 31st October 2018 as the target date for closure of the UK Cheque Clearing - the use of cheques will stop from this date. The final decision on a closure date will be taken by the Payments Council in 2016 and will be dependent on there being a clear consensus across all interested parties.

This decision was taken against a backdrop of falling cheque volumes and after detailed consultation across the UK among cheque users. However, cheques remain a key means of payment, so the withdrawal of cheques will be a significant change for many businesses and individuals.

The use of guaranteed cheques has seen a particularly sharp decline in recent years and the guarantee service will cease from 30th June 2011.

While businesses will still be able to accept cheques after this date, they will not be supported by the scheme. Any cheques written up to 30 June 2011 will continue to be guaranteed as normal.

Although businesses can still continue to write cheques as normal, they should start to consider what the implications of their withdrawal means for their organisation. Some questions to ask yourself ...

• Do you currently receive cheques as payment? If so, how do you want to be paid in future?

• Will you still accept cheques once they are no longer guaranteed?

• Do you currently pay by cheque? If so, how will you pay in future? Remember, June 30th 2011 is already less than a year away!

Stepping Down, But Not Out

You may be aware that Godfrey Lancashire is stepping down from the Board of the Credit Services Association at the CSA & DBSG Annual General Meeting on 9th September 2010.

Godfrey has served on the Board of the Association for almost 14 years, and his dedication, vision and commitment have undoubtedly helped to shape the industry we see today and paved the way for the future.

Godfrey’s particular passion for the raising of industry standards has been evidenced in his interest in the development of industry training and the shaping of the CSA diploma, of which Godfrey remains a tutor.

With a successful term as President, Godfrey has since taken the CSA Public Affairs lobbying to great heights, and has graced the halls of Westminster on numerous occasions to fly the flag for our industry and create awareness of the challenges we face.

I would like to take this opportunity to thank Godfrey for all of his hard work and dedication to the CSA, and there is no more fitting place to do so than in your own London House publication! Godfrey – your support to the industry has been unwavering and your contribution great. You will be missed.

Dr Roger Lucas

President, Credit Services Association