The Office of the Superintendent of Bankruptcy issues another bulletin dealing with unregulated debt advisory marketplace

On January 16, 2025, the Office of the Superintendent of Bankruptcy (OSB) is continuing its efforts to help Canadians experiencing serious financial difficulties find the right debt solution.

The “Find Trusted Debt Relief Solutions” campaign is part of the of the OSB’s ongoing efforts to increase consumer awareness about the unregulated Debt Advisory Marketplace. It aims to raise awareness of reliable debt relief options among financially distressed Canadians and will direct audiences to the Debt Solutions Portal.

The portal includes key resources and tools for managing debt, as well as information on how to find and use the services of Licensed Insolvency Trustees (LITs), who are required to undertake a complete assessment of a debtor’s financial situation and discuss all options available (including non-insolvency options) to help the debtor resolve their financial difficulties and are the only professionals authorized to administer government-regulated insolvency proceedings. By providing accessible and reliable information, the portal will help Canadians take action toward financial stability.

The following are examples of some of the messages conveyed:

• Overwhelmed by debt? Take control with trusted solutions.
• You don’t have to face debt alone. Take action towards a brighter future.
• Struggling with debt? Discover solutions to help you get back on track.
• Licensed Insolvency Trustees offer federally regulated debt relief solutions. Start your journey to financial stability.

In a prior bulletin dated November 2023, The OSB issued a bulletin commenting on five (5) warning signs to be aware of with unregulated debt advisors being:

1. Unrealistic promises or pressure to make a quick decision:  They may not review all of your options for dealing with your debt or make unrealistic promises about being able to eliminate your debt;
2. Asking for up-front fees;
3. Charging unnecessary fees disguised as referral fees or administration fees;
4. Tell you to stop communicating with and paying your creditors or claim that they can negotiate with your creditors on your behalf; and
5. They may only offer online services with no option for in-person services.

A LIT is the only debt relief professional in Canada that is authorized to file a consumer proposal or bankruptcy on behalf of an individual.  They are legally required to review and explain all of your options to you for dealing with your debt.  A LIT is subject to regular reviews, audits and inspections by the OSB to ensure that standards of practices and adherence to the law are being maintained.  There is no such oversight in the unregulated debt advisory market.

A LIT does not charge any fee for reviewing your options with you.  They will make a comprehensive assessment of your individual circumstances.  They are both legally and ethically bound to play an impartial role in ensuring that both your rights and those of your creditors are being maintained.  A LIT is paid out of the proceeds of what you are required to pay under the consumer proposal or bankruptcy by way of a tariff established under the Bankruptcy and Insolvency Act and are regulated by the federal government.

You do not need a referral to speak with a LIT.  You can contact a LIT of your own choosing and one that you feel comfortable with in speaking about your unique situation.  Even if a consumer proposal or bankruptcy is not your best option, the LIT will refer your to a reputable credit counselling agency.  A LIT does not charge a fee for a referral to these agencies and cannot accept a referral fee from the agency.  You can find a local LIT by going to the OSB’s website and accessing the “Find a Licensed Insolvency Trustee” in their drop down menu.

LIT’s are the only federally regulated debt professional with the legal authority to negotiate binding agreements with creditors on your behalf.  As previously stated, only a LIT can offer bankruptcy or consumer proposal services which require that creditors cease collection actions such as collection calls, wage garnishment and civil lawsuits for the collection of monies owing on debts.

LIT’s are required to be licensed by the OSB and must provide an option for in-person meetings at your request at any time during the process.  Be wary of debt advisory firms that only offer online services or that do not have a legitimate address in your locality or even in Canada.

When you find yourself struggling with unmanageable debt, your first call should be to a Licensed Insolvency Trustee to avoid paying unnecessary fees and ensuring that all your options are reviewed for dealing with your debt.

JW Weber & Associates Inc., is a local Alberta licensed insolvency trustee We offer a free, non-judgemental, no obligation consultation to review your specific situation and to review the best options available to you to deal with your debts.  We can be reached at mail@correctthedebts.com or by calling 403-836-6690 to book your consultation and starting the process of getting a financial fresh start.