A Newport catalogue agent who had been using her clients’ child benefit money for payments has been stopped from trading.
One customer had £75 a week taken in child benefit and couldn’t even remember the last item she had bought via the catalogue. One customer had been with the agent for 21 years and many were paying over £40 a week.
Clients reported receiving no statements, had no idea of how much they had paid and were too scared to stop the arrangement.
Kath Hopkins, Moneysaver Project Officer with Charter Housing said ‘a number of our tenants told us they were really worried that they could not afford to pay for food or electricity because their money was being taken by the catalogue lady.’
An investigation by the Wales Illegal Money Lending Unit then resulted in the agent being stopped from trading.
Charter Housing Association’s money advice team contacted Newport East MP Jessica Morden about the practice of child benefit being paid to third parties.
Charter’s money advice team and the MP would like to see a limit on the number of other people’s benefits that can be paid to an individual, and that if there are a number of benefit payments going into an account that it triggers an enquiry by HMRC.
The Newport East MP is asking Ministers to put safeguards in place to ensure others don’t find themselves in the same situation. Current regulations state that Child Benefit can only be paid to another person if it is in the interests of the person claiming the benefit, or the child.
Jessica stated, “I would encourage all constituents in this situation to consider saving with our local Newport Credit Union. One constituent has done this and she now has enough savings to manage this Christmas debt-free.”