Hi,

Just to let you know that I am about to issue 2 Claims against GE Money (then Ocwen) for 2 secured loans taken out on our house in 1999/2000. These claims are possible because, after a professional audit, it was clear that we paid both a stated commission and secret commission on each loan. On one loan the broker's disclosed commission was £2,300 and the undisclosed commission was £4,500 - on a loan of approx £40,000. Both loans were redemned when we sold the house.

I am claiming all associated costs of the loans, in fact, everything except the capital sum, and eight/nine years interest. This gives claims of approximately £25,000 and £30,000.

As per the Hurstanger case, the undisclosed commissions are a breach of fiduciary duty and a form of bribe. Am I one of this first to do this?

Frustrated.

Good for you keep us posted

http://www.consumeractiongroup.co.uk/forum/mortgage-companies/151573-sub-prime-mortgages-loans.html

As a matter of interest, on what grounds do you feel you have to claim all the interest back as a result of this? can you explain your line of thinking and what backs it up at all because I know a number of people who have requested info from brokers.

I'm glad this is coming out into the open, going to be a few brokers with sticky nick knocks after they start seeing people onto this .

Sarah

Okay. About me: just finished Law Degree (2:1) at Birkbeck in London. Only reason to do this was a feeling of lack of power and irritation. Buffeted by the institutional contempt of financial institutions. Knowledge is power and I really do get quite irritated. Collected monies taken from my accounts by NatWest a few years ago, etc..

In the case of G E Money/Ocwen the grounds are as follows: Our audits show two separate commissions to the broker on each loan; one disclosed and one not disclosed. The courts will take their lead from the Hurstanger case. The defendants in Hurstanger were not allowed redress because it was not a "true secret commission case", ie. their documentation stated that the broker "might be paid" a commission and that was enough to negate secrecy. In addition, even if there is no such statement, the customer should ask themselves what the broker is living on if he does not receive commission, and should be responsible enough to ask about commission.

However, in our case, the documentation shows quite clearly a commission of £2,500 to the broker. Being aware of this disclosed commission we would be entitled to believe that this was the brokers only return and we entered into the contract in that belief. The exposure of the undisclosed commission (much larger) would, reading the judge's explanation in Hurstanger make ours a true secret commission case. The remedies, as described in H, are "the amount of the bribe or for damages for fraud where he can recover the amount of any actual loss sustained by entering into the transaction in respect of the bribe given".

We are going for damages for fraud; the actual loss sustained includes any amount except the capital amount. So all interest, penalties, disclosed broker fee, undisclosed broker fee, legal fees, settlement charge, admin charges, completion costs, etc. These amounts are our financial loss caused by entering into a fraudulent contract.

Frustrated

In addition, the court will ask, would we have entered into the contract for a £40,000 loan knowing the real total commission was approximately £6,500? A sum which does not even take into account the interest and fees of the lender. And were there more favourable loan arrangements that we could have entered into? And did our broker not reveal these other loan arrangements to us in a clear breach of his fiduciary duty because the return to him was greater if we signed up to the G E Money/Ocwen loans?

If the secret commission is established, the broker is in breach of his fiduciary duty and the lender is jointly liable. The courts have defined the way forward, but, as yet, I don't think that a provable case of secret commission has allowed the courts to follow through on the judgement given by Tuckey LJ in Hurstanger.

Frustrated

Frustrated

Thanks frustrated, I'll watch this with interest.

Sarah

Hi Frustrated

I'd be interested to know how you're getting on with your claim. I'm currently running a number of similar undisclosed commission claims against GE.

Jonny.

Hi frustrated, strangely I did a law degree for the same reasons and got a 2:1 as well, but with the OU as I work full time. I am interested in your claim as we had a 40k loan from GE. We have already claimed back all the charges and have a 2.5k ERC claim on standby. As ours was also through a broker I will have to do some more research. Do let us know how you are doing with this one.

Hi frustrated, strangely I did a law degree for the same reasons and got a 2:1 as well, but with the OU as I work full time. I am interested in your claim as we had a 40k loan from GE. We have already claimed back all the charges and have a 2.5k ERC claim on standby. As ours was also through a broker I will have to do some more research. Do let us know how you are doing with this one.

Don't want to digress from the thread, but which charges did you get back GL and on what basis? Had a GE Loan too, bags of charges...be interested to know.

Just to keep thread on track...http://www.consumeractiongroup.co.uk/forum/payment-protection-insurance-ppi/170647-secret-commisions.html

In the case we are currently running against GE for undisclosed commissions, at the preliminary hearing the judge asked GE's solicitors (Wragge & Co) whether GE had received any other similar claims and they stated they had not. I'd be very interested to hear if anyone has made a similar claim as I'm sure the judge will not be too pleased if GE have misled him!

All the £40 charges for late payment/failed dd's and the interest we had paid on them. GE very kindly showed this separately on our statements. Was almost £2k. They tried to make me agree to keep my mouth shut - I refused;).

Back on track - how does one find out about these commissions?

Very interesting, Goldlady! What type of loan was it? Secured or unsecured? Was it your main mortgage or an additional loan?

Re finding out about the commissions, they generally will not tell you in the first instance however the loan was arranged through a credit broker rather than directly with the lender then almost invariably a commission will have been paid (in addition to any fee the broker charged you directly). If you start legal proceedings, at that point they will disclose the amount of commission paid.

Secured loan in addition to mortgage. Decided to go for them after they refused to help AT ALL when we got into difficulties and then tried to repossess just before Christmas two years ago. Paid them off by refinancing with 1st mortgage lender then issued court claim:p

All the £40 charges for late payment/failed dd's and the interest we had paid on them. GE very kindly showed this separately on our statements. Was almost £2k. They tried to make me agree to keep my mouth shut - I refused;).

 

Back on track - how does one find out about these commissions?

I actually wrote to my broker and asked him outright. Did he or did he not receive an additional fee/payment from the lender as well as the one I paid him .. First attempt I received a politicians answer "well the question you should be asking is this" and promptly veering completely off track, so a more direct manner of questioning followed

OH has just reminded me that we were supposed to pay the broker a fee but we refused on the basis that they would have had their commission from GE (or IGroup as it was then). We had not been told we would have to pay the broker and they backed down fairly quickly when we put up a fight as obviously someone had forgotten to deduct it from the loan drawdown:D. So I guess we can't really argue that one.

OH has just reminded me that we were supposed to pay the broker a fee but we refused on the basis that they would have had their commission from GE (or IGroup as it was then). We had not been told we would have to pay the broker and they backed down fairly quickly when we put up a fight as obviously someone had forgotten to deduct it from the loan drawdown:D. So I guess we can't really argue that one.

The whole idea of establishing whether a secret commission has been paid is to ensure you were given totally unbiased advice. If they took a fee from the lender they were not unbiased. End of.

I've posted this on the secret commissions thread but am very interested to know how others are proceeding. A friend is seeing a solicitor tomorrow. She got nothing from the broker except his business card - no other paperwork whatsoever. The lender didn't even send her a copy of the mortgage agreement. They are supposed to give the Information Disclosure Document from the outset detailing the charges for their service and a Key Facts Illustration about the loan. She was offered one loan and one loan only, no other companies or loans were mentioned and her credit rating is good - they are supposed to be a whole of market broker. He asked her for a fee just before everything was completed - it was too late then to turn back - and the broker's commission was tucked away on the back of page 10 of the loan offer - she never even noticed it. She was not asked for her informed consent to the brokers commission. In addition, the negotiations were held in her employers house (where she works) with her employer and the vendor present! Ouch! Don't know how she will get on but we will know more tomorrow.

I wonder how everyone above have got on with this secret commission case, I have started my own thread but does not seem to be that much known on this site about it, have you all given up or in the middle of reclaiming.

Please post up, thanks

Hi,

My claim against G E Money Home Lending for two old Ocwen Loans (secret commission, erc) comes up in court next week for a directions hearing.

GE have two preliminary defences: They are not the defendants, Ocwen are (now dormant, bought by Igroup, which is part of G E Money).

and the claim is limitation barred.

So I am going to ask that Ocwen and Igroup are joined as defendants, then I have to wait another 28 days for their defence.

Wragge are their solicitors. Horrible.

Frustrated

Good luck frustrated46,

Let us know how you get on, I wish you the best, and if you win it will be an excellent thread for you to start and be able to help a lot of others too

Hi,

 

My claim against G E Money Home Lending for two old Ocwen Loans (secret commission, erc) comes up in court next week for a directions hearing.

 

GE have two preliminary defences: They are not the defendants, Ocwen are (now dormant, bought by Igroup, which is part of G E Money).

and the claim is limitation barred.

 

So I am going to ask that Ocwen and Igroup are joined as defendants, then I have to wait another 28 days for their defence.

 

Wragge are their solicitors. Horrible.

 

Frustrated

Yes, GE do try this, its rather ridiculous, I understand you can just apply to amend your paperwork via the court to say they you are claiming against the co known as XXX trading as XXX and provide all the letterheads etc that have caused you to think they are called one thing and not another.

good luck (just ASK them outright and copy it to the Court) who are they!!??

IGROUP LIMITED Number 03389478

Previous Name(s)

Changed : 27/03/2000 Ocwen Uk Limited

Changed : 15/04/1998 City Mortgage Receivables 7 Plc

Web Address GEMONEY.CO.UK Incorporation Date 16/06/1997

Kinda says it all really for a Judge...hope it helps...this comes from a Creditcheck/company info information site..good luck

thanks, they tried the old name switheroo with me on my charges claim, but still got them all back!

still in litigation with this lot!

I have also a secret commission claim, I paid a fee of £339 I know its not much, but still it was without my knowledge or consent. Blemain/Finance paid this fee to our broker Ocean/Finance.

I only found this info out when I SAR'd Blemain and the Underwriting Sheet disclosed this amount. I am still waiting for Ocean/Finance to reply to my SAR that I sent them to see what that says and if they have disclosed any fee received by B/Finance.

About but the £339 commission. That should be detailed within section 13 of my KFI when I receive from Ocean/Finance when I receive my SAR

This is what it should read>

"explain to your customer in full that any fee you may charge for your services is NOT a condition of the loan. We will need your customer's request and instruction in writing for us to deduct this fee and send it to you. You may also receive a payment from us in respect of the loan, which you should advise your client of and hold conversation on file