Rogue financial brokers target licensees

Licensees looking for finance are being warned not to pay money upfront to rogue brokers.

The warning follows numerous calls to The Publican by licensees who claim they have been treated unfairly by companies offering finance and mortgages but failing to provide the service they promise.

Nigel Maud, a former licensee and now head of Apricot Catering in Ross On Wye, paid £350 to one of these companies that he says promised him a loan to set up a new business. After sending out the administration fee the loan was rejected.

He said: "The company said it would be able to find us a business development loan. All we had to do was send in the application form and the administration charge.

"After three weeks we got confirmation we could not get a loan so we requested the return of the funds. We have been trying since July to have the money refunded."

Morton Harper, now licensee of the Anchorage Hotel in Blackpool, wrote a letter to The Publican saying he was promised a mortgage by one such company and paid the £350 administration fee as well as an arrangement fee of £1,350.

But when the agreement arrived it did not meet the requirements he was promised.

"We requested a product and had firm requirements and the company confirmed this. We called them all the time to get our money back," he said.

In fact, the offer Mr Harper received was more expensive than the one confirmed over the phone - and he only received a refund after making numerous calls and threatening legal action.

Paul Thompson, partner in broker Acorn Commercial Finance, says licensees should go through a broker that is registered with the National Association of Commercial Financial Brokers (NACFB).

He said: "If something seems too good to be true then it probably is. The NACFB is not compulsory but it's there to clean up the industry and has a code of conduct that has been approved by the Office of Fair Trading."

The NACFB has the power to reprimand, fine or even expel any companies operating unfairly.

Federation of Licensed Victuallers' Associations chief executive Tony Payne said: "These sort of companies trade close to the wire. Ask for a copy of the contract upfront and seek advice. Under no circumstances sign a contract or pay money upfront."

If you have any queries about this article, or have found yourself the victim of any rogue companies, please contact news reporter Michelle Perrett on 020 8565 3053 or at zvpuryyrc@gurchoyvpna.pbz​.