Incorrect debt being collected

[MrChall]

Sorry if I post this in the wrong forum.

 

4 years ago I relocated to Asia. For this reason I sold my car and cancelled my insurance. I left £1600 on my Barclay's bank account.

In December 2011 I attempted to transfer £44.000 from Asia to my bank account, but the transfer failed. I couldn't figure out why.

I relocated back to UK in February only to find out that my account had been defaulted and closed. After some investigation it turned out that Tesco car insurance had opened a new direct debit against my account to insure a car I no longer owned. The £1600 had been spent on this.

 

As a result of this the £1600 was gone, and when the overdraft wasn't paid the account was closed. My Experian credit report was struck by a defaulted account with Barclays. The amount is £315

 

The dept has since been "sold" to a company by the name "Lowell Portfolio". Lowell didn't have my address since I was living in Asia, but that didn't stop them to register a defaulted account with Experian. The defaulted amount is £316. Lowell has also registered one more defaulted account with Experian, this amount is for £913

 

After talking with Lowell, I have announced my willingness to pay the incorrect alleged dept if they agree to remove the defaulted account from Experian, but they refuse to do this. I have also agreed to pay if they are able to provide details of the dept in question, but so far they have not been able to provide ANY details that shows exactly HOW this alleged dept occurred.

 

I don't have any financial difficulties or problems paying this dept, but I feel bad about paying something I shouldn't, especially since I am being penalised for it in my credit report.

 

Should I pursue this legally? How do I do that?

[gordies]

Sorry if I post this in the wrong forum.

 

4 years ago I relocated to Asia. For this reason I sold my car and cancelled my insurance. I left £1600 on my Barclay's bank account.

In December 2011 I attempted to transfer £44.000 from Asia to my bank account, but the transfer failed. I couldn't figure out why.

I relocated back to UK in February only to find out that my account had been defaulted and closed. After some investigation it turned out that Tesco car insurance had opened a new direct debit against my account to insure a car I no longer owned. The £1600 had been spent on this.

 

As a result of this the £1600 was gone, and when the overdraft wasn't paid the account was closed. My Experian credit report was struck by a defaulted account with Barclays. The amount is £315

 

The dept has since been "sold" to a company by the name "Lowell Portfolio". Lowell didn't have my address since I was living in Asia, but that didn't stop them to register a defaulted account with Experian. The defaulted amount is £316. Lowell has also registered one more defaulted account with Experian, this amount is for £913

 

After talking with Lowell, I have announced my willingness to pay the incorrect alleged dept if they agree to remove the defaulted account from Experian, but they refuse to do this. I have also agreed to pay if they are able to provide details of the dept in question, but so far they have not been able to provide ANY details that shows exactly HOW this alleged dept occurred.

 

I don't have any financial difficulties or problems paying this dept, but I feel bad about paying something I shouldn't, especially since I am being penalised for it in my credit report.

 

Should I pursue this legally? How do I do that?

 

 

The debt is not yours technically if you cancelled the car insurance. Did you do this in writing? Did you copy in the bank? Why would you even be interested in paying a debt that you 'may' have not caused?

[MrChall]

I tend to agree.

Unfortunately I didn't cancel in writing, I did this on the phone. However, at the time I canceled the insurance I required one more month of insurance. This was not possible, so I paid 3 months straight away. This money did NOT come out of my direct debit (I cancelled it, remember..)

 

In my opinion Barclay's owes me £1600, any clue as to what I do to claim the money back? Remember they have closed the account (no doubt in an attempt to wipe out the traces of their act, whatever it is called...).

[cerberusalert]

The first port of call is the insurance company, it will have been them that registered the default originally & once the insurance error has been corrected the default should be removed.

 

Did you cancel the insurance?

 

You may have to send the insurance company a SAR to get copies of letters, transcripts of 'phonecalls etc to back up the fact that the insurance was cancelled.

[unclebulgaria67]

Yes you need to go back to the Tesco Car Insurance people and make a complaint. If you gave them instruction to cancel the policy from a certain date, then they should have arranged that. They may have a recording of the phone call or a system note to confirm the request. If this is the case, if you provide evidence of the Barclays overdraft charges and any other costs, Tesco Car Insurance will have to rebate you for these.

 

If you are unable to resolve with Tesco within 8 weeks, go to the FOS. Once a complaint is in progress, advise Lowell of this and they will need to put collection on hold. Under the OFT debt collection rules, Lowells would have to stop collection activity where the debt is subject to dispute.

[MrChall]

How common is it that a company agree to remove a credit report instance in case I agree to pay the alleged debt in full?

 

Currently, my credit report lists this as "Defaulted". What impact would it have on my credit report if I agree to pay (even though I don't want to and might not be legally responsible for the debt).

 

Anyone who knows?

[unclebulgaria67]

If you paid in full, the default would still be on there but would be noted as satisfied. It would take probably a year before any new creditors did not take issue with it and possibly up to 2 years for your credit rating to recover to the previous level. That is my understanding, but perhaps the people to ask are Experian.

 

Nb. Most debt companies/creditors would not remove the default. I am not sure it is allowed, unless there has been an error.

[renegadeimp]

If the default was added in error, then it will be removed. However, you need to start complaining and get accurate info in order for it to happen.

[MrChall]

I have received a reply from Barclays where they confirm that the direct debit was set up on the 30.07.2008, the problem is that I relocated out of the country in May 2008. The initial direct debit was set up in 2005, and when I cancelled the insurance Tesco apparently requested to set up a new direct debit with Barclays, and this was agreed by Barclays without notifying me.

 

How is it even possible that a bank like Barclays agree to set up a direct debit against a personal account without confirming this with the account holder? They treat this as if it was some sort of public property available to anyone in need of some cash.

[renegadeimp]

Some companies can reset the direct debit up if you cancelled it yourself through the bank and didnt tell the creditor.

 

However, if you did cancel it over the phone as you said, then it might be a good idea to request a SAR and demand they send all recorded conversations about you.

[unclebulgaria67]

Direct Debit mandates are all electronic these days and banks don't always send any confirmation that they have been set up.

 

Both Tesco and Barclays will have records of the DDM's being cancelled and set up again.

 

For your information, at the time you had the Tesco policy, RBS Insurance administered the policy and DD's. Tesco have since changed to using Ageas. So it may be that RBS Insurance will have to deal with the complaint on behalf of Tesco, as it relates to a period where they dealt with your policy.