Wealth management trade body PIMFA has welcomed news that the FCA will ban regulated firms ‘phoenixing’ into Claims Management Companies from 7 July.

The Government is to give its Insolvency Service greater powers to tackle firms that try to ‘phoenix’ by setting up near identical new businesses to avoid liabilities and will also target directors who deliberately dissolve firms to avoid bills.

The Financial Services Compensation Scheme (FSCS) has welcomed the Financial Conduct Authority (FCA) consultation paper tackling phoenixing saying it will help “keep bad actors out of the market”.

The Personal Finance Society says it has received up to 40 complaints in 1 week about CMC ‘phoenixing.’