FCA: Exercise caution over repayment demands for disguised remuneration scheme loans

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FCA said that after loans or purported loans under disguised remuneration schemes were resold by the original providers to third parties, some consumers received legal letters demanding immediate repayment and threatening litigation. If the debt is unenforceable, borrowers cannot be forced to repay or have assets seized because of the debt; recovery agents must first obtain a Validation Order from FCA, and approval is not guaranteed. Those who receive such demands should refer to HMRC guidance, consider seeking legal advice, and carefully decide whether to make a payment.