DebtFreeDirect.co.uk don't charge any fees!

Smoke and mirrors. It's all smoke and mirrors.

Debt Free Direct claim to be the UK's leading IVA provider. That's actually adspeak because 'leading' doesn't actually mean much. They are not claiming to provide more IVAs than anyone else or that they are better than anyone else. They are just vaguely claiming to be something that can't really be challenged. They are expressing an opinion about themselves.

But, but ...if we no longer have qualified Insolvency Practitioners and now have to deal with 'IVA providers' then they should at least spare us the hocus pocus.

It's a pity, because their web site starts so well. Debt Free Direct certainly aim to lull us into a sense of false security with their reasonableness - right up until the point when we finally click on point 10 of their FAQs.

Ask a simple question and then the challenges begin..... It's here that Debt Free Direct say (quote): "We don't charge you any fees since these are agreed with and paid by your creditors as part of the IVA. Providing you keep to the agreement for five years, any debt you can't afford to repay will be written off by your creditors. In summary, you pay only the affordable monthly amount you and your creditors agree to under the terms of the IVA."

This really is playing with words. Creditors do have to agree the fees charged for the IP's services as both nominee and supervisor but it is the debtor who has to pay those fees in addition to the minimum dividend payable to creditors.

Of course Debt Free Direct charge fees. They take their fees from the money paid into the IVA trust fund and - like any other insolvency practitioner - they should also provide the debtor with invoices and proper accounting for the money they have taken as fees.

The point of all this wordplay and sleight of hand is quite simple. It aims to block any challenges to the practitioner's fees by the debtors who are actually paying them.

Why ?

Again it's very simple. The last thing IPs want is debtors challenging their fees in court and the reason for that is also quite simple - the law places the onus on the insolvency practitioner to justify his claim to payment and, since the judgement made almost three years ago by Chief Registrar Baister, there are now very specific criteria against which an IP's fees can be judged and the leading criteria is 'value for money'.

Now that can be hard to justify !