Bear in mind how the 8% is calculated....

 

1. The account will be reconstructed with the PPI and associated interest removed. If that reconstruction shows that the account would have been in credit for any period then 8% simple is awarded on that credit balance for that period.

 

2. If the account has been closed and paid off there will be a difference between the reconstructed balance and the balance actually paid. 8% simple is awarded on that difference running from the date the account was paid off up to the date of the settlement of the claim.

 

From this you can see that you only get 8% on money you have actually parted with, i.e. where the other side have had use of your money for a period of time.

 

If you wish to develop the spreadsheets further then please feel free....we would happily look at any revisions.

Yes, I agree with you totally. That is why Capital One who offered me £958.23 of 8% interest which means a credit amount of £11977 cannot be right in offering me only £6000. The correct amount is the £11977 plus the £958.23

The really important point here is that they use compound interest to calculated the revised balance (so as to make HMRC happy) yet do not seem to include this in their redress.

There can be no excuse for this.

I have so many voice recordings from Mastercard where they tell me about the Star Chamber and how my calculations are nearly complete. I now know that this was all a lie and this has been confirmed in subsequent phone conversations. Having reps clearly having a laugh at my expense is very galling and has really annoyed me. Maybe I should just post it all on YouTube !!

The really important point here is that they use compound interest to calculated the revised balance (so as to make HMRC happy) yet do not seem to include this in their redress.

 

There can be no excuse for this.

The compound interest is the contractual interest they charged on the PPI premiums so that would be part of the redress.

As said before, redress = Premiums Paid + Contractual Interest + 8% Where Applicable.

I know that you have said this before and you are totally correct.

The FOS guidelines however seem to express it in a different way in that the account will be reconstructed as if the PPI was never in place.

Where there is a positive balance then the company should pay 8% simple interest on that balance.

I have reconstructed the balance and 8% of the positive balance works out at around £1000.

This means that the positive balance is around £12,000.

The FOS guidelines indicate that this amount should be returned along with the 8%.

The fact is that if you work out 8% interest and the compound interest and add the premiums paid then you come to exactly the same figure as the reconstruction award.

I am saying that Capital Once reconstructed the account, got the balance figure and correctly awarded the 8%.

Then they did something magical and awarded the premiums paid (£3000) and compound interest of £2000.

This comes to £6000. What they should have offered is the £1000 (8%) and then the £12000 (reconstructed balance).

I maintain that they are correctly calculating the 8% to keep HMRC and then doing some magic with the remainder.

I have pointed this out to them but they are saying that it is time barred and hence FOS cannot help with a adjudication.

I am suggesting that if you get a figure for the 8% then you should multiply this by 12.5 and add it to the 8% and that MUST be the minimum that you should be receiving.

have you actually paid this account off and closed it?

If so then you should get 8% on the amount paid off vs the reconstructed balance.

The difference in the reconstructed balance to the amount paid off is the PPI premiums and associated contractual interest so you won't get that balance difference bacg twice...it has already been included in the first part of the redress i.e. Premiums Paid + Associated Interest.

Been on holiday but will email my spreadsheet to you Splashy.

Thanks so much.

Your spreadsheet does indicate very similar figures.

Will have to look at amending to take into account the interest accrued between the end of the spreadsheet and now.