Supposed closed account rises from the dead demanding money!

[knuffelbeest]

Hi everyone. Could someone please tell me how to start resolving the following problem.

 

On the 9th October 2010 I was shocked to receive a letter from Cahoot dated 7th October, blithely telling me that I needed to pay into my account if I wished to continue using the overdraft on my current account with them. They said that the balance of the account was £781.46 overdrawn (plus pending interest and fees), with an overdraft limit of £1,000.00.

 

I rang their office and the clerk I spoke to said that they had already written off a balance of approx £1,300.00 on my credit card (which I didn't know I had!), but that the current account, complete with (authorised) overdraft was valid and still outstanding. When I told him that I was under the impression that I had closed the account around three years before he said that the account had not been used since my last deposit (of £500.00) in mid 2006! When I asked him why Cahoot had not contacted me for four and a half years he apologised but said he didn't know. He said he would look into the matter and call me back. He never did call me back.

 

The next communication was a letter from Cahoot dated 10th November 2010 stating that my account had been restricted until I pay in some more money, and that my overdraft facility may be removed.

 

I have since received a letter from Cahoot dated 3rd December 2010 saying that my account is about to be passed to debt management recovery services. They also said that all facilities on this account have now been removed, and that I will shortly receive a Default Notice served under Section 87 (1) of the Consumer Credit Act 1974, which will explain further action.

 

Shortly after receipt of this letter I called them and told them I would be writing to them shortly. Which brings me to the present time. I have no idea as to what the claimed overdraft balance represents, as I was under the impression that the account had been closed 4.5 years ago.

 

Could someone please tell me what the next step should be?

 

With many thanks

[buzby]

It would appear the account was not closed. If it had a debit balance, then that would not be possible. The Default Notice will stipulate what they require to be done, so await this - then take it from there. Also check your credit file, NOW - to see what they have said about you.

[knuffelbeest]

Many thanks for the reply, Buzby - should I send them an SAR?

[buzby]

No - save your money for now. Get you Credit File for £2 from each of the 3 CRA's to see what's there. Once you get the formal Default Notice from the creditor - read it carefully (as they are not all the same!). If you plan to challenge the DN, then ask for clarification and/or figures to rebut their assertion. If this is not forthcoming. go the SAR route - and the max they can charge for this is £10.

[knuffelbeest]

Thanks again to Buzby. Just an update to say that I have now received the Default Notice, which says that if I do not repay their claimed debt in full (£781.46 plus pending interest and fees) then "...we will demand the immediate repayment of the total balance. We may also take legal proceedings against you for the recovery of this balance or refer your account to debt recovery agents"

 

I have, today, sent a letter to them by recorded delivery, requesting a full breakdown of how the claimed amount is made up and asking them why they did not contact me for four and a half years.

 

I will post their reply as soon as I receive it.