Responding to a Department of Trade and Industry's consultation to update the 1974 Consumer Credit Act, the IPA said it believes the warnings, in their current format, do not properly fulfil their objective of informing the public, due to their legal complexity and length.
It believes the damage they do to legitimate ads outweighs the benefits they provide the consumer and that the warnings are ineffective and discredited in the eyes of the public.
Finally, the IPA said the warnings are largely unnecessary because customers cannot commit themselves at the time they hear or see the ads and will be warned of any pitfalls before they can sign up for any of the financial services that are being advertised.
Geoffrey Russell, IPA director of media affairs, said, "Although we are in favour of proper regulation to ensure the public is protected and informed, we don't believe it is working in this particular case."
He added: "Current credit warnings in ads simply do not work - you know it, I know it - and so do the man and woman in the street, who simply dismiss them as meaningless gobbledegook. The consumer is much better protected through other means, like point-of-sale literature."
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