FCA acts to protect consumers facing demands for disguised remuneration scheme loan repayments

Ethica Resolve, an authorised debt servicer acting for unauthorised West 28th Street, has agreed restrictions after pursuing repayment of loans or purported loans issued through these arrangements. The intervention highlights that firms cannot treat assigned tax-avoidance-linked receivables as routine collections: enforceability, customer communications and third-party authority must all be tested before demands continue. For compliance teams, the priority is exposure mapping.

Identify any portfolios, mandates or outsourced collection arrangements connected to disguised remuneration loans, West 28th Street or similar assignees. Validate the legal basis for each debt and whether limitation, consumer credit rules or contractual defects make it unenforceable. Pause or escalate disputed cases, review scripts and letters for misleading or pressurising language, and ensure vulnerable customers receive appropriate forbearance.

Third-party due diligence should confirm that unauthorised creditors are not conducting regulated activities through the authorised firm. Boards should also consider complaints, redress and reputational risk, and document decisions to continue, pause or remediate collections. The FCA's action reinforces Consumer Duty expectations and signals closer scrutiny of debt purchasers, servicers and their supply chains.

Firms that act early can reduce enforcement risk and build a conduct advantage by demonstrating ethical, evidence-based collections.