Committee chairman Edward Leigh

MPs have called for tighter controls on consumer credit licenses.

The Office of Fair Trading has acted too slowly in stiffening controls on granting consumer credit licences, the influential Commons public accounts committee said in a report on Wednesday.

The MPs called on the OFT to work with the Home Office and the Department for Trade and Industry to prevent those with criminal records and others considered unsuitable from being granted a licence.

This inquiry follows an earlier review by the committee in 2000, when the recommendations were rejected.

Despite earlier assurances, it was only in March of this year that a new application form to secure full benefits from the new technology was piloted.

The MPs also warned that there is little access to criminal records information, although this is in the public domain.

Meanwhile the number of complaints about unfair contract terms has continued to increase.

"It is worrying that there is still far too little control to prevent unscrupulous lenders and debt collectors from obtaining a consumer credit licence," said committee chairman Edward Leigh.

"The Office of Fair Trading must make sure it reaps the benefits of its postcode-matching software in checking applications, and work with the Home Office and the DTI to get much needed access to information on criminal convictions."

The OFT welcomed the report, saying it confirmed it had made progress "on a number of fronts".

It conceded there were continuing problems with the licence system, which the MPs had "rightly highlighted".

But a spokesperson added that there had "been no let up in our effort to get key information on criminal records".