Avoid unnecessary fees when searching for a bankruptcy solution

The above text is from a consumer alert on unregulated, unlicensed debt advisers/consultants from CAIRP and the OSB about the Debt Advisory Marketplace.

For the full advisory, please visit https://www.canada.ca/en/innovation-science-economic-development/news/2022/11/need-help-with-your-debt-ask-questions-and-shop-around-to-avoid-paying-unnecessary-fees.html

The Office of the Superintendent of Bankruptcy (OSB) and the Canadian Association of Insolvency and Restructuring Professionals (CAIRP) have issued a consumer alert to help Canadians avoid unnecessary fees when seeking bankruptcy solutions in Canada. Here are some key points to consider based on the alert:

• Unregulated Debt Advisors tend to offer Unrealistic Promises
  • Unregulated debt advisors may make unrealistic promises and pressure you. They may charge unnecessary fees for services they are not licensed to provide
• Licensed Insolvency Trustees (LITs) are mandated by law and ethical standards to furnish precise, impartial debt counsel and are monitored to ensure compliance to a Code of Ethics.
• Upfront Fees and False Claims: Unregulated debt advisors may request payment before delivering a service and make false claims about obtaining a “better deal” with creditors.
  • LITs generally offer free consultations with no upfront fees and are regulated by the federal government in terms of the fees they can charge for consumer insolvencies and bankruptcies
• Referral Fees and Online Services: Some unlicensed debt advisory firms may charge unnecessary fees disguised as referral fees and may only offer online services without in-person options.
  • LITs do not charge fees for referrals and are required to provide in-person service at any point, at the client’s request.

Where to Find Reliable Assistance:
The OSB and CAIRP provide reliable tools and information about options for dealing with financial difficulties, including map-based directories of LITs and LIT firms. LIT services are available across the country, even in remote locations.