'Junk mail' loan letters stopped over ID fraud fears

Wednesday, 14 October 2009 07:40

A loan company has been stopped from sending out letters claiming people have been turned down for credit.

Horizon Finance had been sending letters offering 'instant cash loans'.

The mail-out stated: "Your application was passed to us by a company that you applied to last year.

"Even though you may have been refused credit in the past we have pre-processed your application and feel sure that we can accept you for an instant cash loan."

However, the letter led one recipient to fear she had been the victim of ID fraud as she had not applied or been turned down for a loan.

There were also complaints from the Advertising Standards Authority (ASA) that the letter did not make it clear it was marketing material.

The case heard by the ASA revealed how Horizon Finance got hold of people's details.

Addresses and personal data came from a number of money and loan comparison sites - where people failed to tick, or untick, the necessary box to give permission for their details to be passed on.

The firm added although the letter claimed it had "pre-processed" an application, it had made no credit checks using the data.

Horizon Finance also said it had "difficulties with their envelope suppliers", which made the letters not appear to be junk mail.

The ASA ruled Horizon Finance must ensure that mailings "do not suggest that recipients had applied for financial products when they had not.

"We also told them to ensure envelopes were clearly marked to show that they contained marketing material."

For consumers, the key lesson is to always remember to tick the write box - on any form - so a company cannot pass on your details

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