Lenders buying back debt to set off refunds

[Guest]

Is this all legit and above board?

 

This is the sort of thing I mean; http://www.ombudsman-decisions.org.uk/viewPDF.aspx?FileID=84262

 

I have a similar issue with quickquid in which they sold a debt and all rights to a third party, but I think they have now bought it back and want to offset the balance against a refund I'm owed. I have noted that the debt is full of charges which would need to be removed.

 

It seems unfair that they can do this as when they sold the account they broke the chain and their right to set it off against any future refund. And they probably sold it for a fraction of what they are now saying it is worth.

 

Any thoughts?

[dx100uk]

Sadly they can and its nothing unusual

 

The fact of the matter is if you didn't actually pay the penalties you can't expect to get the free money

 

Dx

[Guest]

Thanks for the reply.

If they haven't bought it back

can they still set it off and pay the DCA the balance o

r would they have to refund the amount to me?

 

 

I dont know if they have bought it back at the moment,

they just said at the last minute that I had an outstanding balance,

but the debt was sold and the balance they gave is the balance when it was sold

and not the balance now as payments have been made since.

 

Thanks,

Albert

[dx100uk]

no they cant pay the DCA.

 

 

dx

[Guest]

Ombudsman are pushing the possibility that quickquid pay the DCA. Quickquid came back and said their records suggest that they have bought back the account. But if not, they will clear the balance anyway. They have asked me to send any letters I have from the third party so it can be sorted out.

 

Ombudsman previously said

The business has sold the loan. So I think it could only be fair to set it off in certain circumstances, these are;

- if it agreed to buy back the loan and treat it as settled, or

- if it cleared the loan for you and made sure there were no efforts to collect it in future.

If the business agreed to this then I think it would be fair to set off the loan (£607.05) from the offer. It would need to recalculate the offer to you.

 

Replied back saying in summary: I disagree with this.They sold the account and cant say or show that they have bought it back, and with them quoting an outdated and incorrect balance and asking for letters from the DCA it suggests they haven't. I'm sure it is well established that lenders cant set-off compensation owed to a third party.

[citizenB]

You are correct, Albert - they cannot pay off a 3rd party.. they will need to have purchased the debt back.

[Guest]

Thanks CitizenB. I hope you're correct, do you know anything that could back it up in the FSA handbook or previous decisions etc.

[citizenB]

I think there is something that we used to put in a letter when Capone tried this on.. I will try and find it.

[citizenB]

http://www.financial-ombudsman.org.uk/publications/ombudsman-news/40/40_setoff.htm

 

 

 

the account from which the firm transfers the money - and the account from which the money would otherwise have come - must both be held with the same firm.

 

 

This was what I was looking for - you would need to do your own research to see if this is still applicable though.

 

 

In closing, may I add that Bank/Creditor have sold the account to a third party for an undisclosed sum and received tax relief on the written-off debt. Bank/Creditor have no on-going interest in the account and have no right in law to apply NAME PPI refund to a third-party debt.

 

The authority for this view is the case of Edlington Properties v Fenner & Co. Ltd [2005] EWHC 2158 (QB) which affirms this position that the assignor has no right of set-off to a third party (assignee) for a damages claim brought against it post-assignment, as any equitable set-off in this regard is personal in nature and the debt sold is not transferred subject to it.

 

 

Hope this helps.

[Guest]

Thanks for that information it is very usefull. I will include it if they continue to insist on paying the third party.

[Guest]

In the end QQ claimed they had bought the debt back but they couldn't show proof that they had, so the ombudsman ruled that they couldn't set off the refund.

[dx100uk]

Good show

 

Well done!!

[fkofilee]

Very Good Indeed... Albert, im interesting in seeing your case in full. Would there be any chance that you could advise what steps you took and any letters you sent?

[Guest]

Very Good Indeed... Albert, im interesting in seeing your case in full. Would there be any chance that you could advise what steps you took and any letters you sent?

 

Hi.

This is a very messy case tbh that got closed/settled twice before being reopened again.

 

Ultimately though I had a few loans with them that were unaffordable and were rolled over 4/5 times each.

 

The latest loan was for £750 with a duration of only 14 days and my income which I told them of was only £1150 month.

 

I will try to give a basic outline of what happened below, if there's anything specific you want to know just ask.

 

I complained to quickquick saying the loans were unaffordable and I wanted a refund of interest and charges.

 

They sent back a standard looking reply not uphelding the complaint.

I went to the fos online site and filled out the complaint there.

 

Several weeks later I saw that an adjudicator had tried to contact me but I hadn't replied within 2 weeks,

 

they had accepted an offer of £150 from quickquid to settle the complaint.

 

Turns out Quickquid refused to do this because I hadn't accepted it and provided my bank details.

 

Reopened complaint by filling in another form on fos online site.

 

QQ made another offer of £1,620 which I rejected

 

About a month later the adjudicator was still telling me she was waiting for QQ to send her the application form so she could make a view of the complaint.

 

Sick of the delays and unsure what view the adjudicator would take I told her I would accept the offer, which I recieved a few days later.

 

I made a service complaint to her team leader about accepting the £150 offer for me and the delays from QQ sending information, amounting to many months when I was initially only given 2 weeks to respond before the case was closed.

Team leader backed the adjudicator,

 

I argued a few points and the team leader then sent me a dated history of events on this complaint.

 

From this I found that the day before I accepted the offer of £1,620 the adjudicator had made a view and told QQ to refund interest and charges which would have come to over double the offer I accepted.

Not happy I asked for a senior manager to look at my service complaint

 

. After a few weeks I was contacted by senior manager who apologised for accepting the £150 offer on my behalf and for not keeping me informed,

she reccommended that they reopen the complaint and an ombudsman look at it and contact me, which I agreed.

 

The ombudsman contacted me and said he had asked QQ to consider the previous adjudicators reccommendation of the refund of interest and charges.

 

They agreed but then said I had an outstanding debt with them,

the ombudsman seemed to be leaning towards their position at first

 

but after sending all the information on this thread he agreed they could only set off if they could prove they owned or had an interest in the debt, which he didn't think they could.

 

He then passed it to another ombudsman for a final decision in which it was upheld.