Debt management firm Harrington Brooks has agreed to pay £185,000 in redress to 4,500 customers after intervention by the FCA.
In September, the firm informed the FCA that communications with some customers’ creditors had been delayed, meaning customers may have been left with the impression that the firm had been in contact with creditors when it had not.
The delay resulted in some people owing more in interest and charges than if the firm had contacted creditors sooner.
FCA director of mortgages and consumer lending Linda Woodall says: “Debt management customers are struggling financially and often in difficult situations so it’s important that when people are putting their trust in a firm, they get the service they have paid for.
“When things go wrong we expect firms to put them right for their customers and we are pleased that Harrington Brooks is working with us to do this.”
The regulator says Harrington Brooks has cooperated with its requests and will be writing to affected customers in the coming weeks to explain the situation and advise them of any redress that is due.
It is the first debt management firm to agree a redress package since the FCA took over responsibility for regulating the sector on 1 April.
Harrington Brooks chief executive Matthew Cheetham says: “We are pleased that the FCA has acknowledged our role in bringing to light some discrepancies and minor delays in our communications to creditors at the inception of a relatively small number of debt management plans.
“As soon as this issue was identified, it was rectified and our systems improved. We apologise to any customers affected.”