High Court orders closure of Debt Collection Agency

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debt collection agency closed down

The High Court in Manchester has ordered the immediate closure of a rogue Debt Collection Agency based in Newcastle.

Following a number of complaints, the Insolvency Service became aware of underhand debt recovery trading activities and instigated an investigation.

The company, Redwood Business Management Ltd had been trading under the name Rojen Recovery services since its incorporation in 2017. Their registered offices were located in Shedfield, Newcastle upon Tyne.

The Court heard how ‘Rojen Recovery Services’ operated cold calling tele-marketing techniques to offer their debt collection services.

The company would charge a flat fee of 18.5% of the debt that was supposedly to be added to the debt. Spurious claims of a no win – no fee or Free Debt Collection service were made and creditors mistakenly thought they would have nothing to lose as a result.

The dodgy debt collection firm had almost a million pounds paid to them by unwitting debtors and creditors. These payments were between June 2017 and August 2019. The paid monies were made up of debts collected by the company and fees they told their clients were necessary to be paid for court action etc

The accounting records held by Redwood were not adequate enough to properly account for monies received by the company. Investigators did however establish that money had been collected and not paid onto clients.

The Court ordered the winding up of the Company on the basis that it traded with little commercial probity. It was deemed that Redwood had made false and misleading statements to its clients.

The purported ‘No win – No Fee’ Debt Collection service was also found to have failed to account for monies it had collected on behalf of clients and charged clients excessive fees in situations were no fees were actually due. They were also found guilty of generally charging excessive fees also.

The court also stated that it accepted the individuals in control of the company had failed to co-operate fully with investigations and failed to keep proper records of its activities.

Mrs Carol Cree was the last registered Director with companies house and listed as major shareholder.

Chief Investigator for the Insolvency Service David Hope said:

“Redwood Business Management operated in a cynical manner throughout its trading history. It charged clients substantial fees for services that were not required or not provided and at the same time, collected debts that it did not pay on to its clients. Thankfully, the court has now put a stop to the company’s activities, preventing further harm”

If you were a client of Rojen Recovery Services then any enquiries should be made to:

If you have been a genuine victim of a different rogue debt collection agency then please visit the government website to do so.

If you are thinking of using a debt collection agency then it is advisable to apply due diligence from the start. It is wise to use only accredited Limited Companies with a sizeable trading history.

 

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