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IPA expectations for protecting IVA customer interests

29/10/2024
IPA expectations for protecting IVA customer interests


In light of recent research commissioned by The Insolvency Service (IS) regarding take-on procedures and early IVA failures in a small sample of terminated IVAs, David Holland of the Insolvency Practitioners Association (IPA) has issued reminder guidance outlining key expectations for IPs to ensure that all IVA customers are treated fairly, transparently, and in accordance with professional standards.

This extends into the debt advice channel into the IVA take-on process.

IPs should ensure they have robust procedures to protect customer interests and ensure compliance with the revised SIP 3.1. As with the FCA Consumer Duty, this should be readily evidenced. There should be consistency in terms of the treatment of customers with characteristics of vulnerability. The IS report highlighted the risk of poor outcomes.

Of note is the reference to the accuracy in financial assessments, including I & E completion, something picked up by Dylan Jones of IE Hub ahead of PS24/2 (Borrowers in Financial Difficulty) that comes into force on 4/11/2024.

An ongoing issue which has been identified by the IPA is regarding concerns around an IP’s ability to provide complete call recordings and documentation. This is an important requirement under SIP 3.1 and under Regulation 13 of The Insolvency Practitioners (Amendment) Regulations 2015. The IPA expects any deficiency to be addressed immediately and firms’ processes for retention of call recordings to be kept under review.

This update follows on from the PayPlan response to the IS report, where they confirmed usage of the Consumer Duty Services (CDS) IVA sustainability score going forward and that the IS need to distinguish between FCA-regulated debt solution providers and debt-packagers, as defined under PS23/5 (in CONC). This follows the DEBT MANAGERS STANDARDS ASSOCIATION LIMITED clarification to the IS and the FCA on the same point.

CDS is speaking and exhibiting at the IPA conference on 28 November in Manchester. This follows on from the successful IVA volume provider event on 3 October in Manchester.

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