Shut down: Debt collectors kept £55k client funds

THREE interconnected debt collection companies in Sunderland, which kept almost £55,000 in client funds that they collected on behalf of their clients, have been shut down following an insolvency investigation.

- OLIVIA SHEED

The fraud was uncovered when several clients paid the companies to collect debts, only to never receive the cash.

EDC Group NE Ltd, UK EDC Ltd and UK TCF Limited misrepresented themselves as professional agencies with decades of experience, while taking payments from both clients and their debtors.

According to The Insolvency Service, the companies targeted small businesses through unsolicited phone calls, using misleading information to persuade them to sign contracts for debt collection services.

Victims reported paying instruction fees, only to find themselves unable to contact the companies despite promises that collected funds would be safeguarded.

At least £54,847 in funds was collected and retained by the companies without being returned to their clients.

The companies operated nearly identical websites, with UK EDC and UK TCF sharing the same site. False claims on the websites described the companies as “market leaders” with “cutting-edge collection technology” and featured 65 positive testimonials that misrepresented their success in debt recovery.