I propose to take Questions Nos. 81 and 82 together.
I am advised by the Central Bank of Ireland that it has authorised 47 debt management firms.
A “debt management firm” is defined in Part V of the Central Bank Act 1997 (as amended), and means “a person who for remuneration provides debt management services to one or more consumers, other than an excepted person”. “Debt management services”, as defined in the Central Bank Act 1997, means “(a) giving advice about the discharge of debts (in whole or in part), including advice about budgeting in connection with the discharge of debts, (b) negotiating with a person's creditors for the discharge of the person's debts (in whole or in part), or (c) any similar activity associated with the discharge of debts”. The regime for the authorisation and supervision of debt management firms came into effect in Irish law on 1 August 2013.
Of the complaints received in 2018 by the Financial Services and Pensions Ombudsman (FSPO), I can confirm that one complaint was received against a debt management firm.
Additionally, upon establishment in 01 January 2018 the FSPO inherited the caseload of its predecessor organisations, the Financial Services Ombudsman and the Pensions Ombudsman, which included one complaint against a debt management firm.
In this instance, the complaint concluded in 2018 following a full investigation and adjudication, which led to the issuing of a legally binding decision which upheld the original complaint. Where a complaint is upheld, substantially upheld or partially upheld, the Ombudsman may direct rectification or compensation, or both, in respect of all or some of the matters complained of.
The Central Bank has not had any investigations into, or sanctions against, a debt management firm in respect of their debt management services in recent years.
Regarding the number of debt management firms that have been found by the Central Bank to be operating here without a licence to do so, and the implications for those companies operating without a licence, the Unauthorised Providers Unit (‘UPU’) of the Central Bank of Ireland investigates instances of alleged unauthorised activity carried out by firms or individuals who hold no authorisation from the Central Bank.
It should be noted that details of specific investigations undertaken by the UPU in relation to individual firms/persons cannot be disclosed to any third party due to confidentiality provisions as set out in Section 33AK of the Central Bank Act 1942 (as amended). I am informed that all instances of alleged unauthorised debt management activity are investigated by the Central Bank.
If an investigation conducted by the Central Bank concludes that a firm is engaging in unauthorised debt management activity, the Central Bank, by using its enforcement powers under the Central Bank (Supervision and Enforcement) Act 2013, can issue a warning notice against the firm and/or apply to the High Court for an Enforcement Order.
To date, the Central Bank has issued 4 warning notices (via press releases on its website) in relation to unauthorised debt management firms. In addition, the Central Bank obtained one High Court Enforcement Order in relation to an unauthorised debt management firm.
In addition, it is a criminal offence to operate as a debt management firm in the absence of the appropriate authorisation.