ASA Adjudication on The Claims Warehouse Ltd

Ad

A press ad in the Metro was headed "Credit Cards, Loans and Mortgages Investigated". The body copy stated "Do you have a credit card or loan with a balance of £1000+, or do you have a mortgage? If so, you may have an unfair credit agreement and may be entitled to thousands of pounds ... Our solicitors specialise in challenging these agreements. In many cases they could be unenforceable. Our specialist solicitors produce a 20+ page audit detailing if and where your credit agreement could be unenforceable. If we find there are breaches The Claims Warehouse will take on the case to work towards having these credit cards/loans cleared.” A telephone number was listed at the bottom of the ad.

Issue

Lloyds TSB challenged whether the ad was misleading because:

1. it exaggerated the likelihood of the debt being written off, and

2. it did not make clear that fees applied to the advertiser's services.

CAP Code (Edition 11)

Response

1. The Claims Warehouse Ltd (The Claims Warehouse) said they worked closely with the Ministry of Justice and did not intend to use any misleading advertising. They said they had a network of Independent Consultants who were given ongoing training and regular updates on compliance issues. The ad was taken out by one of those Independent Consultants. They said they did not consider the ad exaggerated the likelihood of the debt being written off because it made no mention of a debt being written off, or the likelihood of a debt being written off. They emphasised that the ad stated many agreements "could" be unenforceable, and sent information setting out the total number of credit card and loan agreements already assessed. They said there were arguable cases for unenforceability in 73% of those agreements.  

2. The Claims Warehouse said they did not think the ad implied they were offering a free service. However they said they would be prepared to include the text "fees are fully refundable if you have no claim" in future ads.

Assessment

1. Upheld

The ASA noted The Claims Warehouses assertion that the ad did not exaggerate the likelihood of a debt being written off, because it made no reference to debt being written off.  However, we considered the claim "In many cases they [the credit agreements] could be unenforceable" implied the credit agreement would be unenforceable in a significant number of cases.  To substantiate that claim, we considered The Claims Warehouse would need to show the percentage of loan agreements they assessed that were unenforceable, and not merely potentially unenforceable. Because they did not send that information we considered the claim had not been substantiated. We therefore concluded the ad was misleading and exaggerated the likelihood of the debt being written off.   

On this point the ad breached CAP Code clauses 3.1 (Substantiation), 7.1 and 7.2 (Truthfulness).

2. Upheld

We welcomed The Claims Warehouse's willingness to amend the ad. Because fees applied to the service offered by the Claims Warehouse, but the ad did not make that clear, we concluded it was misleading.  

On this point the ad breached CAP Code clauses 3.1 (Substantiation) and 7.1 and 7.2 (Truthfulness).

Action

The ad must not appear again in its current form.

Adjudication of the ASA Council (Non-broadcast)