Consumer Credit Act Agreements

[tamadus]

Most of us are now aware of the effects of non compliance with a consumer Credit Act section 77/78 request. I would like to try and clarify the result of a s78 (1) request I recently made.

The company concerned responded 12 days before it went to the poition of committing a criminal offence, however what they have sent me is a copy of the original application and is clearly marked as an application. Its my feeling an application shouldn't be considered as a regulated agreement under the CCA. I am certain (but cannot immediately find the detailed description of the form a regulated agreement should take) that the heading on the agreement should clearly state 'Credit Agreement' (or words to that effect).

Also on the copy of the application they have sent I added a second card holder (authorised user)with a different surname to mine. Underneath the authorised users signature it clearly states Authorised users must have the same surname as the applicant.

I am now wading through the CCA (1974) trying to clarify these points and came across something interesting in section 85, and I quote.

85 Duty on issue of new credit-tokens

(1) Whenever, in connection with a credit-token agreement, a credit-token (other than the first) is given by the creditor to the debtor, the creditor shall give the debtor a copy of the executed agreement(if any) and of any document referred to in it.

(2) If the creditor fails to comply with this section-

(a) he is not entitled, while the default continues, to enforce the agreement; and

(b) if the default continues for one month he commits an offence.

(3) This section does not apply to a small agreement.

Now by definition a credit card has to be a credit-token. The CCA clearly states that a copy of the executed agreement has to be supplied to the debtor prior to its use and the debtor has a 'cooling off' period. I read section 85 as meaning that any time the creditor replaces or issues a replacement card a copy of the original agreement has to be supplied with the new card (credit-token).

I have NEVER recieved a copy of the agreement when a credit card has been replaced. I may be going over old ground here but has anybody any suggestions on section 85 of the CCA and also on the application form suddenly becoming an agreement and the authorised user having a different surname?

[dollies01]

I had the exactly the same response with my cca request to Lowell finance, who are acting on the behalf of Captial One.

They sent me a copy of the short application form.
Nothing else whatsoever.
As far as I am concerned they have, so far, failed to fulfill the cca request.

An application form, in my handwriting, merely proves, I applied for a card.

[tamadus]

Originally Posted by dollies01

I had the exactly the same response with my cca request to Lowell finance, who are acting on the behalf of Captial One.

They sent me a copy of the short application form.
Nothing else whatsoever.
As far as I am concerned they have, so far, failed to fulfill the cca request.

An application form, in my handwriting, merely proves, I applied for a card.

I fully agree dollies and I am trying to decide now if it's worth persuing. I wonder how many other credit card applications were granted purely on the application form without a clearly marked credit agreement.

I have just got a reply to my CCA request to Capital One and its clearly headed 'Credit agreement as regulated by the Consumer Credit Act 1974' along with the terms and conditions and it contains a right to cancel section, along with a section on my rights under the act.

My opinion also is that Barclaycard have failed under section 78(1) of the CCA to provide what I asked for and I now need to decide how best to follow it up. My feeling on the application form is that they broke their own (written) rules by allowing an authorised user with a different surname, and that they have also failed under section 85 by not providing a copy of the credit agreement each time a new card was issued. An application form does not constitute a credit agreement, it simply means I applied for one. They did not at the time allow a cooling off period or deliver a copy of the agreement before executing it. They have still not produced a signed credit agreement regulated by the Consumer Credit Act (1974) and what they have produced fails a long way short of the regulations in the act. I need to find out the official version of whats has to be included to constitute an agreement now.

[The Terminator]

Originally Posted by tamadus

I fully agree dollies and I am trying to decide now if it's worth persuing. I wonder how many other credit card applications were granted purely on the application form without a clearly marked credit agreement.

I have just got a reply to my CCA request to Capital One and its clearly headed 'Credit agreement as regulated by the Concumer Credit Act 1974' along with the terms and conditions and it contains a right to cancel section, along with a section on my rights under the act.

My opinion also is that Barclaycard have failed under section 78(1) of the CCA to provide what I asked for and I now need to decide how best to follow it up. My feeling on the application form is that they broke their own (written) rules by allowing an authorised user with a different name, and that they have also failed under section 85 by not providing a copy of the credit agreement each time a new card was issued. An application form does not constitute a credit agreement, it simply means I applied for one. They did not at the time allow a cooling off period or deliver a copy of the agreement before executing it. They have still not produced a signed credit agreement regulated by the Consumer Credit Act (1974) and what they have produced fails a long way short of the regulations in the act. I need to find out the official version of whats has to be included to constitute an agreement now.

I've just looked through the Sections of the Act that you have mentioned and in my opinion I think you have opened up a massive can of worms here especally under Section 85 which I see is a very big loophole in the act which constitutes that the terms and conditions are only enforceable during the period between when the card was issued and when it expires.So in effect everytime a new card is issued a new agreement must be issued as well, the same as for arguements sake a tenancy agreement with a private landlord who issues a new agreement every six months.Erm there seems to be a lot of logic there.Having read it again it seems to me that every CC Provider is in breach of the act which unless you have a current agreement default notices are not worth the paper there written on.

[tamadus]

Originally Posted by The Terminator

I've just looked through the Sections of the Act that you have mentioned and in my opinion I think you have opened up a massive can of worms here especally under Section 85 which I see is a very big loophole in the act which constitutes that the terms and conditions are only enforceable during the period between when the card was issued and when it expires.So in effect everytime a new card is issued a new agreement must be issued as well, the same as for arguements sake a tenancy agreement with a private landlord who issues a new agreement every six months.Erm there seems to be a lot of logic there.Having read it again it seems to me that every CC Provider is in breach of the act which unless you have a current agreement default notices are not worth the paper there written on.

Thats exactly how it struck me as I read it. The first card issue is ok as its covered by the agreement but subsequent issues without being accompanied by a copy of the agreement put the CC company into a default situation and the agreement becomes unenforceable. One interesting point is that Egg actually put on the back of their card that it may only be used in accordance with current Egg card credit agreement conditions. The other cards I have access to only state (if anything) that its use is in accordance with current terms and conditions.

As I see it the original agreement will cover a new card issue, but ONLY if its included with the card issue. Maybe I am wrong so hopefully somebody with more knowledge can correct me.

This may be a new can of worms but I am no further along with my application form questions and it's after 2:30 again

Since when does an application form become an agreement regulated under the act? Every other agreement I have clearly states it is a credit agreement regulated under the CCA (1974) this application form doesnt give that in any way, shape or form, and clearly states it is an application, although it is signed (almost illegibly) by the branch manager.

Ah well just another stage in the Barclaycard saga so I am heading for sleepy land and will continue the quest tomorrow.

[The Terminator]

Originally Posted by tamadus

Thats exactly how it struck me as I read it. The first card issue is ok as its covered by the agreement but subsequent issues without being accompanied by a copy of the agreement put the CC company into a default situation and the agreement becomes unenforceable. One interesting point is that Egg actually put on the back of their card that it may only be used in accordance with current Egg card credit agreement conditions.

Section 85(1) of the Act makes it plain as you've already posted

As I see it the original agreement will cover a new card issue, but ONLY if its included with the card issue. Maybe I am wrong so hopefully somebody with more knowledge can correct me.

The only way that would comply is if Section 85 was actually written into the agreement.I think you've stumbled on something here.

Since when does an application form become an agreement regulated under the act?

It doesn't

I'd be interested to know what some of the Im an orange think of what you have brought up.

[tamadus]

Originally Posted by The Terminator

I'd be interested to know what some of the Im an orange think of what you have brought up.

yes so would I and hopefully one or more of them will make a comment soon. The suspense is killing me lol. On the face of it every one of the credit card companies has incorrectly issued replacement cards and the agreement is no longer enforceable.

I am also looking at another aspect which makes agreements unenforceable but figured to look a fool on this one first

[pugsley]

hope this is true because I have had 3 cards with capital one over the last 2 1/2 years I possibly activated them and signed them but didn't get a new credit agreement

[PhantomReclaimer]

Originally Posted by tamadus

Most of us are now aware of the effects of non compliance with a consumer Credit Act section 77/78 request. I would like to try and clarify the result of a s78 (1) request I recently made.

The company concerned responded 12 days before it went to the poition of committing a criminal offence, however what they have sent me is a copy of the original application and is clearly marked as an application. Its my feeling an application shouldn't be considered as a regulated agreement under the CCA. I am certain (but cannot immediately find the detailed description of the form a regulated agreement should take) that the heading on the agreement should clearly state 'Credit Agreement' (or words to that effect).

Also on the copy of the application they have sent I added a second card holder (authorised user)with a different surname to mine. Underneath the authorised users signature it clearly states Authorised users must have the same surname as the applicant.

I am now wading through the CCA (1974) trying to clarify these points and came across something interesting in section 85, and I quote.

85 Duty on issue of new credit-tokens

(1) Whenever, in connection with a credit-token agreement, a credit-token (other than the first) is given by the creditor to the debtor, the creditor shall give the debtor a copy of the executed agreement(if any) and of any document referred to in it.

(2) If the creditor fails to comply with this section-

(a) he is not entitled, while the default continues, to enforce the agreement; and

(b) if the default continues for one month he commits an offence.

(3) This section does not apply to a small agreement.

Now by definition a credit card has to be a credit-token. The CCA clearly states that a copy of the executed agreement has to be supplied to the debtor prior to its use and the debtor has a 'cooling off' period. I read section 85 as meaning that any time the creditor replaces or issues a replacement card a copy of the original agreement has to be supplied with the new card (credit-token).

I have NEVER recieved a copy of the agreement when a credit card has been replaced. I may be going over old ground here but has anybody any suggestions on section 85 of the CCA and also on the application form suddenly becoming an agreement and the authorised user having a different surname?

I'm, not sure it's that simple. You need to research certain things further. You say that a credit card has to be a credit token. Perhaps, but is "credit token" defined in the Act? Perhaps a "credit token" is some arcane iuntrument that you only geta single use of or something? Even if it isn't then perhaps the actual "credit token" is actually the account with a given spend limit and that the card is only evidence of such "token"? If that were the case then new replacement carrying the same account number and expiry date would not be a new token, just replacement evidence of it.

Also, what is a "small agreement"?

I've never looked at the Act just runnign some stuff off the top of my head.

P.

[pugsley]

SE16090 - Vouchers and credit-tokens: meaning of credit- token

Section 142(4) and (5) ICTA 1988

A “credit-token” is something which merely has to be produced in order to obtain goods and services without immediate payment. It does not have to be capable of being exchanged for goods or services.

A credit-token is “any card token document or other thing”, except a non-cash or cash voucher, which is given to a person by someone who undertakes:

• to supply money, goods or services on credit on its production, for example, a credit card supplied by a retailer or
• to pay a third party for the supply of money, goods or services on its production to that third party, for example, a credit card like a Mastercard or Visa card supplied by a credit card company.

A charge to tax arises where such a credit-token is provided for an employee or a relation ( SE16080) by reason of the employment. For the amount chargeable as an emolument see SE16140.

The use of a “credit-token” to operate a machine, for example, a cash dispenser, is deemed to constitute its production.

The charge arising from the use of credit-tokens eliminates any argument over whether the payment by an employer of credit card bills run up by an employee is a discharge of the employee's pecuniary liability ( SE00580). There is thus a uniform charge on all employees in these circumstances however the credit card facilities are provided.

[pugsley]

Guardian Unlimited Money | Credit and debt | GE Capital Bank told to change its ways

[The Terminator]

Originally Posted by pugsley

Guardian Unlimited Money | Credit and debt | GE Capital Bank told to change its ways

Either the OFT have sh-t out or they are totally incumbasant to the law.Section 85(1) quite clearly states that each time a new credit token is issued then a new agrreement has to be signed as well.It is ironic in two ways that the CC companys have got away with this for the last 30 years and a poster on a forum has what in my opinion has opened up a can of worms and most proberly the biggest loophole in the act.Barclaycard, Egg, MBNA eat your hearts out coz the terminator is after yer.

[The Terminator]

Originally Posted by pugsley

SE16090 - Vouchers and credit-tokens: meaning of credit- token

Section 142(4) and (5) ICTA 1988

A “credit-token” is something which merely has to be produced in order to obtain goods and services without immediate payment. It does not have to be capable of being exchanged for goods or services.

A credit-token is “any card token document or other thing”, except a non-cash or cash voucher, which is given to a person by someone who undertakes:

• to supply money, goods or services on credit on its production, for example, a credit card supplied by a retailer or
• to pay a third party for the supply of money, goods or services on its production to that third party, for example, a credit card like a Mastercard or Visa card supplied by a credit card company.

A charge to tax arises where such a credit-token is provided for an employee or a relation ( SE16080) by reason of the employment. For the amount chargeable as an emolument see SE16140.

The use of a “credit-token” to operate a machine, for example, a cash dispenser, is deemed to constitute its production.

The charge arising from the use of credit-tokens eliminates any argument over whether the payment by an employer of credit card bills run up by an employee is a discharge of the employee's pecuniary liability ( SE00580). There is thus a uniform charge on all employees in these circumstances however the credit card facilities are provided.

So what we are talking here is a credit card.Now in a court of law can that be disputed.IMHO I don't think so.So the OP who brought this up and may only have stumbled over it by chance deserves a beer. Nice one son!!

[The Terminator]

https://wwwa.applyonlinenow.com/UKCC...k?eid=3E39D3DF

Having read the above I see no mention of S85(1) of the CCA(1974)as amended.The Im an orange might want to study this as from the offset the T&C may well make any agreement null and void.Sorry time to sleep no doubt I will be seeking advice from lawyers tomorrow and will post any information received.

[tamadus]

Originally Posted by The Terminator

Either the OFT have sh-t out or they are totally incumbasant to the law.Section 85(1) quite clearly states that each time a new credit token is issued then a new agrreement has to be signed as well.It is ironic in two ways that the CC companys have got away with this for the last 30 years and a poster on a forum has what in my opinion has opened up a can of worms and most proberly the biggest loophole in the act.Barclaycard, Egg, MBNA eat your hearts out coz the terminator is after yer.

The act doesn't say a new agreement has to be signed but that the creditor ( card issuer) has to give a copy of the executed agreement with the new token.

[tamadus]

Originally Posted by pugsley

SE16090 - Vouchers and credit-tokens: meaning of credit- token

Section 142(4) and (5) ICTA 1988

A “credit-token” is something which merely has to be produced in order to obtain goods and services without immediate payment. It does not have to be capable of being exchanged for goods or services.

A credit-token is “any card token document or other thing”, except a non-cash or cash voucher, which is given to a person by someone who undertakes:

• to supply money, goods or services on credit on its production, for example, a credit card supplied by a retailer or
• to pay a third party for the supply of money, goods or services on its production to that third party, for example, a credit card like a Mastercard or Visa card supplied by a credit card company.

A charge to tax arises where such a credit-token is provided for an employee or a relation ( SE16080) by reason of the employment. For the amount chargeable as an emolument see SE16140.

The use of a “credit-token” to operate a machine, for example, a cash dispenser, is deemed to constitute its production.

The charge arising from the use of credit-tokens eliminates any argument over whether the payment by an employer of credit card bills run up by an employee is a discharge of the employee's pecuniary liability ( SE00580). There is thus a uniform charge on all employees in these circumstances however the credit card facilities are provided.

Thanks pugsley I knew it had to be defined properly somewhere. Having just read the article pugsley found I have a feeling they will get over this by claiming the replacement card is the same token and not a new token. The article mentions activating a card but (and I am probably wrong) I see activation as a clear sign that something about the new card has changed even though the account number remains the same.

I do recall a couple of years ago that MBNA took over the credit card side of RBS and replaced all RBS affinity cards with MBNA cards. That must surely come under section 85 as the account numbers, the creditor and the card appearance changed. Lots more research needed still.

[tamadus]

Originally Posted by PhantomReclaimer

I'm, not sure it's that simple. You need to research certain things further. You say that a credit card has to be a credit token. Perhaps, but is "credit token" defined in the Act? Perhaps a "credit token" is some arcane iuntrument that you only geta single use of or something? Even if it isn't then perhaps the actual "credit token" is actually the account with a given spend limit and that the card is only evidence of such "token"? If that were the case then new replacement carrying the same account number and expiry date would not be a new token, just replacement evidence of it.

Also, what is a "small agreement"?

I've never looked at the Act just runnign some stuff off the top of my head.

P.

If I recall correctly a 'small agreement' is one under £50. The difference between a 'new token' anbd a replacement needs clarifying further I think. Personally I suspect that having to 'activate' a replacement card makes it different in and electronic aspect as the replacement wont work untill such time as it is activated, even though the account numbers remain the same. Also small changes occur which are visible, namely expiry dates, security number, and signature strip has to be signed again. I suppose they could even claim that by signing a replacement card that we actually verify the original agreement.

I would definitely class the latest 'chip and pin' cards as new tokens though as they use different technology and no longer require a signature at point of sale. Those IMHO should require totally new agreement as the customer (debtor) is now very vulnerable to fraud usage with no comeback on the creditor.

[pugsley]

when I got a replacement credit card the number (is this the same as the account number?, not sure) of the card has changed for capital one, but the account and balance remain the same.

[tamadus]

Originally Posted by pugsley

when I got a replacement credit card the number (is this the same as the account number?, not sure) of the card has changed for capital one, but the account and balance remain the same.

The account number is the 16 digit number on the face of the card. I am sure changing the account number should warrant a new agreement, but need advice from the legal eagles

[PhantomReclaimer]

Originally Posted by tamadus

The account number is the 16 digit number on the face of the card.

Not necessarily. The 16 digit number is the card number and might or might not be the same as the account number.

A debit card has a 16 digit number which identifies that particular card but the account number is the card holders bank account number. There are also cases where more than one person has a card for the same account but, for obvious reasons, they can't both have the same number.

P.