• They were supposed to help consumers go out of the debt spiral, but they have violated their rights themselves.
• President of UOKiK Tomasz Chróstny has challenged the practices and contractual provisions applied by Certo law firm.
• The total fines for the company amounted to nearly PLN 640 thousand.

President of UOKiK Tomasz Chróstny has issued two decisions against Certo Kancelaria Janowicz-Stradomska and Wspólnicy sp.k. from Warsaw. It offers its consumers a “Debt relief” and “I repay pay my debts” programmes whose aim is to reduce the debt. “With us, you will relieve yourself more quickly from your debts, by paying the amount of debt we have negotiated which will be lower by as much as up to 50%. Thanks to this, not only will you make your savings but above all you will be free from your debt"- Certo promises to its consumers in a welcome letter. However, the law firm does not guarantee success, its services are presented in a misleading way and the from the money paid by consumers for the repayment of debts the law their remuneration is dedcuted.

- After a careful analysis of the contracts concluded by Certo law firm with its consumers, we have questioned 5 practices of this company and 14 prohibited contractual provisions. Indebted consumers could not have been aware that the use of the law firm’s services could have worsened their financial standing even further. If, for example, they have been clearly informed that the law firm collects their payments for future settlements with creditors, and not for current debt repayments, and deducts their fees from them, they could decide that it is safer to deal with debts on their own than to use Certo services – says Tomasz Chróstny, President of the Office of Competition and Consumer Protection.

Contested Practices

In the first decision issued, President of UOKiK stated that Certo law firm applied practices that violated the collective interests of consumers and ordered them to be discontinued. These are:

• Misleading consumers' money deposited on a dedicated account which can only be accessed by Certo. According to the agreement, it is a "monthly amount paid by the Customer to the Bank Account for Settlements, intended to satisfy Creditors and remuneration of the Law Firm". Therefore, consumers could not be aware that these funds would be transferred to the accounts of their creditors only after a settlement was reached and that Certo did not regulate any current loan instalments on their behalf.
• Misleading that the Certo contract and the actions taken by the company on debt reduction protect creditors from pursuing claims at that time, for example in court. Consumers, by granting power of attorney to the law firm, among others, to negotiate with creditors, may be convinced that these also cover this issue.
• Concealing information about the possibility of losing all or part of consumers' money accumulated in the Certo account. From this money the remuneration to the law firm was deducted; moreover, the law firm might use it to cover some additional costs not provided for in the contract. Therefore, if no settlement is reached, consumers will not recover all payments made.
• Collection of “initial charges” before consumers receive the terms of the contract in writing.
• Determination of the fees for Certo at the net rate, i.e. excluding VAT. In accordance with the law, consumers should be clearly informed at the time of the contract conclusion of the price including all components and taxes.

Abusive clauses

The second decision of President of UOKiK concerns prohibited provisions in contracts concluded by Certo with consumers. They were supposed to enable the law firm, among others, to:

• change the amount of consumer payments during the programme, e.g. depending on the number of creditors accepting settlement proposals or in connection with changes in the client's financial standing,
• manage, by the law firm, the funds paid by consumers,
• charge some additional fees in case of necessity to cover costs or take actions outside the scope of the agreement, and charge customers with negative consequences if they resign from paying for these costs,
• renew the contract,
• terminate the contract without notice with immediate effect where the consumer fails to make two full payments within the time limit.

Abusive clauses do not apply to consumers. They should be treated as if they were not present in the contract.

Fines

President of UOKiK Tomasz Chróstny has imposed fines on Certo totaling nearly PLN 640 thousand (PLN 639,290). The law firm will also have to inform about those decisions on its website and Facebook profile.

The decisions are not final – the entrepreneur may appeal to the Court of Competition and Consumer Protection.

Read what to think about by signing the contract with the debt service company: https://uokik.gov.pl/news.php?news_id=17447

Consumer Support:

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Consumer Ombudsmen – in your town or district
Financial Ombudsman – when a complaint has been rejected by a financial institution

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