You make extremely good points - a number of which are already of concern right within the IP profession as well.
The problem, as I see it, is one of being able to determine what mis-selling actually constitutes. I feel that there are so many people in IVAs who spend so little time discussion options with their IPs or senior staff (in accordance with SIP 3) that they feel confused at the time of signing up, and then get disgruntled when they feel that their IPs do not understand them - or at worse they do not understand the terms of the agreements they specifically signed up to. This is not a mis-sold IVA, but is perhaps poor client service on the part of the IP.
IVAs have traditionally been a complex tool and are only appropriate in certain circumstnaces - but if used correctly provide a far better return for creditors than would be available under bankruptcy proceedings, and more certainty of recovery than under a DMP. Initially designed with the business owner, professional or company director in mind, it was hard to envisage in the mid 1980's the explosion of consumer debt which we are now experiencing.
Until recently - IVA protocol and suggestions for SIVAs - IVAs have not really been tailored to the needs of the consumer, and were very legally worded and quite obviously confusing. I am pleased to report that the great steps taken by the Insolvency Service/Debt Resolution Forum and the BBA have now resulted in a much more suitable method of operation for consumers, who now represent over 80% of all IVA applications. The industry will see a difference in time!
As an IP myself, I would never let someone enter into an IVA who I felt did not understand the consequences and implications - or simply the terms of the document they are signing up to. Detailed meetings with clients are essential to be held with senior members of staff, but preferably the IP themselves, to satisfy both sides of understanding and commitment.
It is arguable whether the so called IVA factories are more or less efficient than smaller more specialist practitioners. As one who perhaps sits in the middle of both types of practice, I can see the benefits of both - and try to take the best bits from each. Automation and efficient systems are ideal, but not at the expense of customer service or simply a good duty of care to both debtor and creditors.
As IPs we know that there have, and potentially still are, problems within our profession which we are all working very hard to erradicate. However, it is the whole debt industry who should shoulder some of the responsibility for poor practice in the past, and we should all work together to improve our standards to ensure that confidence in this very vital part of the UK economy is restored and that we all move forward in a postive manner. Those who refuse to join must then pay the penalty.
Regards, Melanie Giles, Insolvency Practitioner
