CONC 8.8 Debt management plans

A firm in relation to a customer with whom it has entered into a debt management plan must:

1. (1)

   maintain contact with the customer;

   [Note: paragraph 3.44 of DMG]

2. (2)

   regularly monitor and review the financial position and circumstances of the customer;

   [Note: paragraph 3.44 of DMG]

3. (3)

   adapt the debt management plan to take into account relevant changes in the financial position and circumstances of the customer;

   [Note: paragraph 3.44 of DMG]

4. (4)

   inform the customer without delay of the outcome of negotiations with lenders, in particular, where the lender has:

   1. (a)

      refused to deal with the firm; or

   2. (b)

      returned payments to the firm; or

   3. (c)

      refused the debt repayment offer; or

   4. (d)

      refused to freeze interest or charges accruing;

      [Note: paragraph 3.45a of DMG]

5. (5)

   inform the customer of any material developments about the relationship between the customer and the customer's lenders;

   [Note: paragraph 3.45b of DMG]

6. (6)

   provide the customer with copies of correspondence or documentation relating to material developments relevant to the relationship between the customer and the customer's lenders;

   [Note: paragraph 3.45b of DMG]

7. (7)

   where the firm makes repayments on behalf of the customer:

   1. (a)

      monitor the customer's repayments for evidence which suggests a change in the customer's financial circumstances;

   2. (b)

      review, and amend or terminate, where appropriate, the customer's debt management plan at the earlier of:

      1. (i)

         each anniversary of entering into the plan; or

      2. (ii)

         as soon as the firm becomes aware of a material change in the customer's circumstances; and

   3. (c)

      inform the customer of the outcome of any reassessment;

      [Note: paragraph 3.45c of DMG]

8. (8)

   provide a statement to the customer at the start of the debt management plan, and at least annually or at the customer's reasonable request, setting out:

   1. (a)

      a balance showing the amount owed by the customer, including any interest charges at the beginning of the statement period;

   2. (b)

      fees, charges and other costs applied over the period of the statement, including any upfront fee or deposit, such as an initial arrangement fee, an arrangement fee, any periodic or management or administrative fee, any cancellation fee and any other costs incurred under the contract;

   3. (c)

      a narrative explaining the type of fee applied, how the fee is calculated and to what it applies;

   4. (d)

      the duration or estimated duration of the contract;

   5. (e)

      the total cost of the firm's service over the duration or estimated duration of the contract; and

   6. (f)

      monthly or other periodic payments made to lenders;

   [Note: paragraphs 3.45cde of DMG]

9. (9)

   maintain adequate records relating to each debt management plan which the firm has administered for the customer until the contract between the customer and the firm is completed or terminated;

   [Note: paragraph 3.45i of DMG]

10. (10)

    check the accuracy of the details of the customer's accounts; and

    [Note: paragraph 3.45j of DMG]

11. (11)

    use reasonable endeavours not to send inaccurate information to lenders.

    [Note: paragraph 3.45j of DMG]