JOHN McFALL, chairman of the Treasury Select Committee, called yesterday for banks and credit-card companies to employ stricter controls to prevent people with mental health problems being showered with offers of credit.

Mr McFall complained that the most harrowing letters that the Committee had received came from the parents of young adults who were unable to stop credit-card companies from allowing their children to rack up uncontrollable debts.

Mr McFall said: “Despite desperate pleas to financial services companies, the offers kept on coming, leading to tragedy.”

Kerry McCarthy, the Labour MP for Bristol East and member of the Committee, said that the Committee’s drive to improve levels of data-sharing in the credit industry would focus upon measures that the banks can put in place to stop vulnerable groups such as the mentally ill from obtaining loans and credit cards.

She said: “I find that the parents and carers of people with mental health problems in my constituency are unable to put a block on these offers (of more credit). The issue of banks tempting people into more debt is a big issue that needs to be addressed.”

Banks, fearful of accusations of irresponsible lending, are already taking steps to make frontline salespeople and debt collectors aware of how to deal with people who have mental health problems.

Last week the Finance and Leasing Association (FLA), a credit industry trade body, distributed an information pack, explaining how people with mental health problems should be treated, to its members.

Teresa Perchard, director of policy at Citizens Advice, welcomed the FLA initiative: “We have found that many of the people we help with debt problems say they cannot cope or are in crisis and a quarter of our debt clients are receiving treatment for stress and depression from their GP.”

A Citizens Advice client in North East England was able to take out loans with a large high street bank, despite being detained as an inpatient at a psychiatric hospital. In this case, the bank refused to write off the debt and pursued the debt, despite being told by the debtor’s psychiatrist that he was incapable of understanding the agreement that he had entered into.

Karen Bennell, a spokeswoman for the FLA, said that lenders risk breaching the Disabilities and Discrimination Act 1995 if they ask people to disclose any mental health problems in a credit or store card application. “Some mental health problems are ongoing, while others occur only at a particular time,” she said. “The important thing is that lenders respond appropriately when a borrower tells them that they have a specific health problem.”