Lloyds buys back debt to swallow up refund!?

[greendykes]

Hi I would just like to bring this strange matter to peoples attention and also hopefully somebody on this brilliant site might just might tell me what to do next! I am totally confused now. For a bit of a history behind this recent development. I have been fighting on two corners regarding Lloyds.

1. Regarding unfair bank charges

2. Disputed debt(seemingly a mixture of overdraft & loan) that they had sold onto a DCA.

Repeated request SAR's, CCA's to Lloyds & DCA brought nothing forward. Eventually the DCA stopped pestering me after they could not produce a CCA or proof of the debt. Lloyds took nothing what so ever to do with it as it now was sold to DCA.

After I complained to FO regarding bank charges, Lloyds eventually agreed to a settlement figure. Then out of the blue I received a letter from them saying it was being used to reduce the debt (disputed!). therefore no refund was due.

So I complained again to the FO please see the letter below, I also sent a copy of the letter to Lloyds.

Letter sent to FO

Further to your letter dated the 5th of November.

I would like to bring your attention to the following matter relating to this case and the offer Lloyds TSB made.

Today I received the enclosed letter (1) from Lloyds TSB. I would also like to bring your attention to the enclosed letter to DCA regarding the debt mentioned by Lloyds (2) enclosed. This dispute has been going on since March 07 and it is still not resolved. Further more I have enclosed the information I received from DCA per my Subject Access Request, (letter 3). I have highlighted Page 5 of the system report which states that “this debt was sold to us (DCA)”. I would appreciate some advice on this matter because I feel that Lloyds TSB have no right to use the amount offered to reduce a debt that

• Is being disputed by me
  
• They have already sold onto a Debt Collecting Agency, so they do not own this debt anymore.

Your assistance in this matter would be appreciated. If you require any further information please contact me.

I then received a letter back from the FO explaining about how debtor and creditor works! BUT what was even more surprising was quote " With regards to your point about the debt being sold to DCA, it may well be the case that Lloyds had to buy the debt back, as is sometimes the case. You may wish to check this with lloyds."

I also received a letter back from LLoyds, after sending it personally to the nice man from Customer Service Recovery Centre..guess what I received back.

I shall begin...Thank you for getting touch. I am sorry you are unhappy about your bank account charges. If your complaint relates to the level, faitrness or lawfulness of charges please read on. If it realtes to another issue such as an administrative error then please let us know. I am sure you all know what the rest of the letter said by now. BUT that made me so angry they didn't even read the letter I sent them including all the evidence.

So all you nice people out there..if you have managed to get through this ramble..what to do now? Any help would be so mauch appreciated.

Thanks

[elsinore]

Hi greendykes.

 

Have you got all the information you need to calculate the total of unlawful charges?

 

If so, is the total greater or smaller than the alleged debt?

 

How much did LTSB offer you? Has the alleged debt been reduced accordingly?

 

Els

[greendykes]

Hi Els

1. I was claiming £1283.00 that was without interest

2. The disputed debt is meant to be £2175.94, I have nothing in writing from either DCA or LLoyds to tell me how this total was arrived at. They only say that it is an accumulated total of an overdraft & loan.

3. Lloyds offered me 1091.50 which the FO said they agreed with.

4. I don't know I have still not received anything in writing to show what this debt stands at now.

5. Should I CCA Lloyds now? I have already CCA the DCA but this turned up nothing.

 

Totally confused

[elsinore]

Yes, confusing isn't it!

 

So you are saying that LTSB did not respond to your SAR until FOS put pressure on them to do so.

 

LTSB then sent you some information which enabled you to calculate your unlawful charges, but not enough information for you to know the extent of the debt, nor the division between the overdraft and the loan. Is this the case?

 

If the disputed debt is allegedly £2175.94, but you have nothing in writing, how did you come to know that figure?

 

If the DCA has handed the debt back to LTSB, then LTSB are entitled to reduce your indebtedness to them by the amount of their offer. Whether the remaining balance is legitimate is what you are trying to establish.

 

You have already sent a CCA request to LTSB without result, so I don't see the point in sending another one. They probably have nothing to send you anyway.

 

Els

[Goldlady]

It would be very interesting to know how much LTSB sold the debt for and indeed how much they paid the DCA to buy it back.

 

It is a very interesting problem - if you had not reclaimed the charges the unenforceable credit would have vanished into the ether. I suspect there is very little you can do, apart from not pay them another penny.

[greendykes]

Thanks for responding to this thread.

1. The DCA told me the amount in a letter BUT when I asked both the DCA & Lloyds to show me breakdown of this debt I received no reponse.

2. LLoyds sent me statements which did not show the amount of debt they now state. This is the question I kept asking where did this figure appear from, this is why I disputed the debt. Their own figures don't add up.

3. I am also annoyed because I received no letter etc telling me LLoyds had bought back the debt until I sent the settlement agreement. I still thought I was fighting the DCA.

4. Before I know it Lloyds will probably sell the debt back to the DCA and we will have to start all over again.

I am just so tired of the covert methods being done. I don't know where to turn next. Mood today, tired angry, sad and confused. I dont know what to do next.

[remus]

Hi Greendykes, has LTSB actually told you that they are now dealing with the debt? The FO said they may have sold it back, you need to find out for definite if that is the case.

I thought you could request your money back via a cheque?

And don't we just know the methods they use:mad: to make you tired, angry, sad and confused. Don't let them get to you, it's not personal, and they wont be losing any sleep.

Just to cheer you up, they don't seem to use the same DCA twice:)

[greendykes]

Thanks for the support remus. LTSB have not responded to any of my letters. I am going to write to them again but at this moment I am a little lost for words! I did request the money by cheque but then this happened. When I complained to the FO they said they could not force the banks to pay by cheque so another brick wall.

I am just trying to think of my next move. I honestly though that due to the debt being in dispute that Lloyds could not do anything like this and just totally ignore me..how niave am I. Basically back to round one.

 

Thanks again remus..your support is appreciated and it has cheered me up:)

[elsinore]

Starting with your thread title GD, I don’t think it’s a case of LTSB buying back the debt in order to offset the refund and spite you. What is more likely is that the DCA sent the case back to LTSB, because they knew, after you CCAd them, that they were wasting their time.

If was fortuitous from LTSB’s point of view that, having had the debt returned to them, they were then able to offset the refund, which they agreed with FOS, against the balance. They are simply writing down a bad debt without having to write a cheque.

 

You may well feel aggrieved that you haven’t received what was due to you, but

• your perceived debt has been halved,
  
• the DCA is off your back and
  
• LTSB are unlikely to be successful chasing you for the alleged balance, as they seem unable to back it up with hard evidence.

I am just trying to think of my next move.

 

I would do nothing. The ball is now back in LTSB’s court. Let them chase you, if they will, for the balance. Only if they commence court action will you be required to take action. They could, of course, sell the remaining debt again, but any new DCA will encounter the same problems as the first and can be easily rebuffed.

 

Els

[greendykes]

Els..thanks for the sound advice. I must admit I was raging when this happened and utterly confused. I have calmed down now and I suppose I have to admit defeat on this one or maybe look at it as half a victory! I am still bemused by the actions of Lloyds, knowing that if I just ignored their letters I would be hauled off to court. As it is near xmas I have decided to let it rest, peace and goodwill and all that. I will let everybody know if I do hear from LLoyds/DCA again. I will always dispute this debt as I have received nothing in writing from either parties explaining how they came to this amount. Once xmas is over and my batteries are recharged I may revisit this..but as for now I am totally drained and have no fight left in me. As the great man said "I will be back!"

 

Thanks to all for your advice and support and Merry Xmas everybody!

[suzieblooz]

Don't know if you've read this thread, http://www.consumeractiongroup.co.uk/forum/general/122831-debt-sold-dca-who.html#post1308897, but the 4th reply down (by Sancho) might help.

S. x

[greendykes]

suzieblooz you are a star x

 

I have further interesting developments on this case and will be updating it on Monday. But the above thread has been a tremendous help and boost thanks again.

[greendykes]

Latest developments. The DCA has raised its ugly head again! I received a letter dated 24th Dec threatening me with legal proceedings. The most annoying thing is that they are still quoting the full disputed debt WITHOUT the deductions from my refund!! Then another letter arrived dated 7th Jan 08 from LCS solicitors for the same amount. This is really getting me angry. I would appreciate some advice. I am going to write again to the FO and forward these letters of harrassment. Any other ideas would be appreciated.

[tifo]

i have been told by the FOS that even if you dispute the debt with DCA, unenforceable etc it will still be paid to them. They even actively seem to encourage banks to buy back these debts so the refund could be taken off it, but there are other issues to buying back a debt.

[remus]

Hi Greendykes, if LTSB have taken the refund, because they now own the debt (?) the dca is no longer involved.

If the dca still has the debt, then is it not the case that you should have received a cheque from LTSB?

If LTSB and the dca did not come up with a cca they can not enforce the debt.

 

And how can the FOS say what you should be doing with the money that was unlawfully taken from you by LTSB? What law is there to say that money that is refunded to YOU has to go towards any outstanding debts?

I thought that if you had more than one creditor, one company could not make claim to your monies as that could prejudice the others?

 

Happy to be corrected:)

 

So many questions:mad:

[tifo]

as i understand it, it's to do with set-off and cross-claim.

 

if the bank owned the debt, they could set it off against the debt by making a cross-claim in their defence.

 

if the debt is with a DCA, the bank cannot make any set-off as there is nothing with them and there can be no cross-claim in their defence, therefore the payment comes to you.

 

to be safe, if you issue a case against the DCA for CCA non-compliance and to make the debt uneforceable and issue a case against the bank for the refund of charges, the DCA *should not* be able to sell the debt back to the bank while in litigation or as it has been judged unenforceable, or so i understood it until one well known DCA did sell it but you would have to tackle that in your POC if it happened.

[greendykes]

Thanks for the replies tifo & remus. I am glad I am not the only one who finds this development so confusing. You would think it would be as simple as remus said but since Lloyds & the DCA seem to being playing tennis with this debt I seem to be chasing shadows. I thought that since this debt was disputed that nothing could happen until either Lloyds or the DCA provided the agreement. I don't hold out much hope in getting assistance from the FO but what else can I do. I would really appreciate somebody somewhere helping me compose a letter that covers all the legal issues as I am not to hot on that. Thanks again. Will keep you all posted

[tifo]

FOS are no help here. They openly allow banks and DCA's to abuse the refund process.

 

The only final thing to do is take each bank and DCA to court and let judge decide, or the bank may pay out before any hearing. They can shout all they want that the refund has been paid to the customer through the DCA but the case is between you and the bank with the DCA an outside third party and until you get the cheque, it hasn't been paid. To receive any money the DCA would have to make a cross-claim for the right of set-off which they never do as the banks and FOS are so nice to them. In any such case they'd have to prove ownership and if they haven't complied with a CCA request, it don't look too good for them.

[greendykes]

Oh just reading back my thread and just to let everybody know that it is the same DCA who is chasing me again! So I am just going to photocopy all previous correspondence and send it to them again with a covering letter. Might as well start somewhere AND I am going to CCA LLoyds. When I SAR Lloyds previously they only sent photocopies of statements nothing else.

[greendykes]

Latest update on this fiasco. Urgent advice needed! I really need some help on what to do next.

 

I received a letter today from the DCA regarding my disputed debt. Here goes. I have added my own comments in italics!

 

Dear Me

 

Thank you for your letter dated 16th Jan 08.

 

I note that you recently made a payment of £1091.50 on this account(I didn't this is my refund for unfair bank charges! Lloyds made this payment.) I also note that you state this account is still in dispute but that you have not provided us with the full details of your dispute although copy statements have been sent to you. (I have given them full details numerous times plus the statements sent don't add up to the debt being asked for!)

 

With regards to your questions raised, I will respond as follows.

 

1. We purchased the debt from Lloyds TSB in early March 2007 and a Notice of assignment was generated on the 8th of March and posted to your above address. (so no mention of Lloyds buying it back!)

 

2. With reference to your copy of the agreement, we have previously advised on this in our letter of the 21st Aug that we have taken legal advice and can advise that Section 78(1) relates to request for copies of agreements. Bank overdrafts are exempt from Part V of the CCA1974. As such there is no statutory requirement to enter into a formal credit agreement for bank overdraft. (disputed debt is made up of overdraft & loan as they have previously advised me).

3. We take the view that unless you provide us with full details of your dispute the balance remains due and payable and are not in breach of the regulations.

4. We have not passed this account to a third party and would ask that you substantiate your claim that we have by providing us with the name of the third party. (how can they say this! I received a letter from LCS Solicitors stating that DCA was their client!)

5. We have not registered any further information with the Credit reference agencies. The debt remains outstanding and the original entry with the credit reference remains.

6. We are unaware of any legislation that states a default notice or data that is believed to be correct must be removed.

 

Please therefore provide us with full details of your dispute within 21 days from the date of this letter, failing which we will consider passing the matter to our solicitors to commence immediate legal proceedings.

 

We look forward to hearing from you.

 

End of letter

 

Please is there anybody that can help me draft my next letter, it would be really appreciated.

 

Should I contact the FO again regarding the disclosure that LLoyds hadn't bought back the debt. Should I contact Lloyds and explain they had no right paying money(in my name!) to a disputed debt. I don't like the way the DCA said I had made a payment, what should I do about this? I would really really appreciate some advice.

[tifo]

Should I contact Lloyds and explain they had no right paying money(in my name!) to a disputed debt. I don't like the way the DCA said I had made a payment, what should I do about this? I would really really appreciate some advice.

 

I've had about 5 complaints go this way now through the FOS. The bank has paid the DCA and the FOS agree this is correct. All the debts are unenforceable as no agreement has been provided by the DCA under a s.78 request, but this does not worry the FOS or the banks, and both have said the court will take the same view. Some members on here have said the same thing. This means i will lose all my refunds into unenforceable debts.

 

The above is just the way banks do it now. Before they used to refund us and not care about the DCA but this seems to have changed.

 

The advice seems to be that you will only get your refund if you paid the actual charges and there is no balance outstanding at the bank or a DCA, otherwise the money will go into that, agreement enforceable or not doesn't seem to bother them.

 

Have a look at this thread, page 2 onwards. Not good reading for those who have a debt with a DCA.

 

http://www.consumeractiongroup.co.uk/forum/debt-collectors-debt-collection/128540-quick-question-cca-data.html

[greendykes]

Thanks Tifo..really interesting thread and yes not good reading but I am not giving up yet:)

[tifo]

Thanks Tifo..really interesting thread and yes not good reading but I am not giving up yet:)

 

Me neither.

 

To have a right of set off, there must be a debt with the bank. In this case there is none.

 

To receive any money, the DCA must have a cross claim to my claim with the bank. In this case they haven't and cannot as the debt is unenforceable and in court they would have to show why they want the money.

 

The bank can buy the debt back, apply the refund and sell it back. But this is not as simple as saying it because agreements are involved.

 

In paying the refund to the DCA, the bank is acting as an agent for them and me.

 

I've heard the way to stop this is to make a claim against the DCA and the bank at the same time. The DCA can then not sell the debt as it is in litigation, and the bank is obliged to pay only you as there is no third party to the claim. If the DCA want the money, they can cross claim but would need to show proof in the form of an agreement for why they want this money.

[tetley75]

just subscribing as a family member is in the same spot.