A national press ad for Unfair Credit Direct was headlined "Mis-sold Mortgages". Text in the body of the ad stated "Your unsecured loan & credit card agreements may be unenforceable? Call us now to find out! Do you know that through brand new legislation 70% of credit agreements may be unenforceable?"

 

The complainant challenged whether the claim "Do you know that through brand new legislation 70% of credit agreements may be unenforceable?" was misleading and could be substantiated.

 

The ASA challenged whether the ad should have made clear that a fee applied to the advertiser’s services.

 

Unfair Credit Direct said they had used the ad for two years and had worked with the Ministry of Justice to ensure they also were satisfied with the ad. They explained that they had based the claim "70% of credit agreements may be unenforceable" on their initial studies conducted from within the industry.

 

They said they had made many agreements unenforceable, and that more cases were still in progress. Unfair Credit Direct said, once those cases were completed, they believed the 70% claim would be proved to be accurate.

 

In the interim they had included the word "may" to make clear that the figure may not be correct. Unfair Credit Direct said, as a result of the legal uncertainty created by test cases in this area, they had decided to withdraw the service from their portfolio and would not be advertising it again.

 

Unfair Credit Direct said they did not charge upfront fees but did charge fees once they were in a position to move forward with contesting a client’s agreement.

 

These fees were made affordable to clients through a month by month payment arrangement. They said their terms and conditions made clear that they fully refunded clients for whom they had not successfully made an agreement unenforceable.

 

The ASA noted that Unfair Credit Direct believed that the word "may" made clear that the 70% figure was conditional. However, the advertising watchdog did not consider that that alone was sufficient to counter the overall impression created by the ad that, because a large proportion of credit agreements might not be enforceable, it was likely that consumers who fulfilled the conditions stated in the ad could find that their own credit agreement would be unenforceable.

 

The ASA noted that Unfair Credit Direct believed their own figures and caseload pointed to the claim being accurate, but it also noted that we had not seen evidence that supported the claim that 70% of credit agreements might be unenforceable. It therefore concluded that the claim was misleading.

 

On this point the ad breached CAP Code clauses 3.1 (Substantiation) and 7.1 (Truthfulness).

 

The ASA noted that, while Unfair Credit Direct did not charge upfront fees, they did charge for their services. It considered that the ad should have made clear that a fee applied to the advertised service, and because it did not we concluded that the ad was misleading.

 

On this point the ad breached CAP Code Clauses 3.1 (Substantiation), 7.1 and 7.2 (Truthfulness).

 

The ASA ruled that the ad must not appear again in its current form. It welcomed Unfair Credit Directs assurance that they would not be advertising this service again in future.

Source: Best Advice