FCA debt advice warning: how to spot firms pushing you towards the wrong solution

05 Oct 2026

The FCA debt advice warning issued this week sets out a list of concrete red flags that people struggling with debt should watch for when seeking help, as the Financial Conduct Authority (FCA) expresses concern that some consumers are being steered towards fee-paying solutions that may not suit their circumstances.

The FCA is the UK’s financial services regulator. Its role includes supervising firms that offer debt advice and, where necessary, taking enforcement action against those that fall short.

What the FCA debt advice warning actually says

The regulator has identified several specific warning signs. The first is feeling hassled or repeatedly contacted, particularly after making an online enquiry or receiving an unexpected phone call. Being pressured to agree to a debt solution quickly, whether over the phone or via WhatsApp, without time to consider all options, is another concern the FCA highlights.

People should also be wary if they are asked or encouraged to change details about their income or outgoings on an application or assessment form, or if they feel they are being “coached” into what to write. Being pushed towards a fee-charging solution, such as an individual voluntary arrangement (IVA, a formal agreement between a debtor and creditors to repay part of what is owed) or a debt management plan, without alternative options being properly explained, is a further red flag.

The FCA also flags situations where the person making contact does not explain who they work for, or where their contact details do not match a firm’s official records. Consumers can use the FCA’s Firm Checker service to verify that a firm is properly authorised.

Alison Walters, director of consumer finance at the FCA, said: ‘Anyone struggling with debt deserves advice that puts their interests first. Free, impartial debt advice is available to everyone, and no one should be pressured or misled into paying for a debt solution that may not be right for them.’

Free debt advice is available through the government-backed MoneyHelper website, which the FCA points to as a starting point for anyone unsure where to turn.

The enforcement picture behind the FCA debt advice warning

The warning comes as the FCA’s own data shows a busier period of enforcement activity. According to FCA operating metrics, the regulator delivered 47 enforcement outcomes in 2025/26, up from 42 in the previous year. The total value of financial penalties in 2024/25 reached £186,412,508.

Analysis published by WilmerHale noted that the largest single penalty the FCA imposed in 2025 was £44 million, underscoring that the regulator is prepared to act with considerable force against firms it finds in breach of its rules. Separately, data tracked by AML Watcher shows that the number of open FCA investigations decreased from 188 to 130 in 2025, suggesting the regulator has been closing cases at a faster rate than it has been opening new ones.

That context matters for people reading the red-flag guidance. The FCA is not simply issuing a leaflet; it has an active record of pursuing firms that act against consumers’ interests, and the debt advice sector is now clearly in its line of sight.

What to do if you are worried about debt advice you have received

Anyone who is unhappy with an authorised firm can make a complaint directly to it. If that does not resolve matters, they can escalate to the Financial Ombudsman Service (FOS), an independent body that settles disputes between consumers and financial firms. If someone believes they have received poor debt advice or been pressured into an unsuitable solution, the FCA says they should contact it directly.

Vikki Brownridge, chief executive of StepChange Debt Charity, welcomed the FCA’s action and offered practical guidance of her own. ‘Be wary of anyone asking for upfront fees, making promises about writing off debt, or putting pressure on you to make a decision quickly,’ she said. ‘These are all red flags to watch out for, and we welcome the FCA taking action against providers that may not have consumers’ best interests at heart.’

Brownridge also acknowledged why people can end up in risky territory in the first place: ‘It can be difficult to open up to others if you’re struggling with debt, so it’s natural people may look online for sources of support in the first instance. This can draw up a whole host of solutions offering ways to clear your debt, not all of which are trustworthy.’ She added that debt advice from reputable free organisations is ‘non-judgmental’ and helps people find ‘a solution that’s right for your circumstances.’

The FCA’s core message is straightforward: no one should ever have to pay for debt advice, and anyone who feels pressured to do so should treat that pressure itself as a warning sign.

Brendan Carey

Brendan Carey spent sixteen years in education before he started writing about it. He trained as a secondary school computing teacher, ran an ICT department for a decade, and spent his last years as a digital learning lead at a multi-academy trust trying to get procurement budgets to match curriculum ambitions. He writes about edtech, digital skills, curriculum policy, and the reality of teaching technology in schools where the Wi-Fi drops out during inspections. He knows what works in a classroom and what works in a sales demo, and they are rarely the same thing. Brendan lives in Leeds. He has opinions about the computing curriculum that he considers constructive and Ofsted would consider robust.