Debt sold for less than settlement offer

[PAWS]

Banks are cheating their shareholders rather than negotiate with debtors.

 

I am appealing to anyone out there who had a settlement offer rejected only to discover their debt was sold on.

 

I have two examples, with full paper trails proving that Santander turned down settlement offers of up to 50 pence in the pound but within a few months sold those debts to Arrow Global for 16.2 pence in the pound or probably less. In these cases Santander and Arrow Global both insisted they would accept nothing less than the total owed from the debtor.

 

If I held Santander shares I would want to know why they turned down at least 33.8 pence in the pound just because it was the debtor’s money and not Arrow Global’s.

 

These above referenced cases were only two out of one million accounts bought by Arrow in early 2013. The total ‘loss’ incurred due to Santander’s determination to punish the debtors was almost £3000. That’s the loss on two accounts out of one million. As Santander was not the only bank having a ‘basement’ sale there must be many more debtors out there who had their offers rejected before the debt was sold on. Even if they did not or could not make an offer surely the Banks should give them a last chance to settle at a rate slightly above that offered to the debt collectors?

 

I know Santander is a Spanish Bank but I have a very strong feeling that many other UK banks, including those who wave their begging bowl at the taxpayer when they mess up are merrily involved in the same practice.

 

I am sick of people quoting Polonius with his infamous ‘neither a borrower nor a lender be,’ but let us not forget that Polonius was a fool. A bad debtor is not necessarily a bad person. Many, through no fault of their own have lost their jobs /income and their debts may include car loans and credit card balances not racked up by buying Gucci Handbags but School Uniforms and boiler repairs. The way the banks and I am afraid to say the moral majority treat debtors is a disgrace. The bankers (please feel free to apply rhyming slang!) approach to debt is one dimensional. There is only one punishment regardless of how many times you explain your situation or however hard you work to try and resolve the problem.You may not always wind up in court but you are harassed, bullied and let’s remember the branding on your credit file.

 

Please remember that I do not need any personal details. Just confirmation that your bank rejected your offer then sold on the debt. If you offered more than 16.2 pence in the pound the chances are you were cheated. Then I can confidently start to campaign.

 

Many may say I am wasting my time but this is a disgraceful situation and I feel I have to do something. I will be posting this on ‘the other website’ because I need as many examples as possible.

 

Many Thanks.

[BankFodder]

We'd be interested to know about the paper trail you refer to as it could be worth considering some action.

[citizenB]

My understanding of these assignments are that the bank sells the debt, then writes it off against tax. On top of which, am I correct in thinking they have insurance on debt which would cover them for any other shortfall ?

 

How exactly would a body find out how much their account was sold to a Debt purchaser, for ?

 

If we could get a few more people to provide this information, it would indeed be worth pursuing.

[rebel11]

I offered some monies to a DCA to settle a couple of accounts, instead the original creditor sold them, the purchaser closed them without a settlement being paid. I was pro-active.

[Mike_hawk]

I always understood it to be a 'money go round' for the original lenders, most of them have some financial association with the major debt buyers in the market such as AG and RBS special opportunities which only severed its links last month. From my own experience and from those of a fair number on here, lenders tend to inflate the debt prior to assignment as it seems to assist tax input from bad debts.

[PAWS]

Many thanks for all your comments. I know the price Arrow paid because in an article in Credit Today (3 June 2013) Arrow Global is reported as purchasing these and other debts for an average of 4.5 pence in the pound although Ian Drury from Arrow claims that they paid an average of 16.2pence in the pound. Ian Drury was bragging just how cheaply he bought the debts for and was being hailed as a financial genius. (Big bad swear word!)

 

The two examples I have are only two of the millions of debts Arrow bought early last year and I know they bought from a number of banks and lenders at that time. I am trying to discover if any of the banks who later waved their caps at the tax payers looking for a bailout were involved –if so they have actually robbed us twice! I have proof of delivery of offers to Santander and the corresponding refusal letters and insistence on nothing less than 100% of the debt. I know they get Tax relief when they ‘write off’ bad debts but I am not so sure that applies when they sell them off but even if it did it would still not add up to the amount offered in the two cases above. I have however saved the best ‘till last……wait for it…these two examples were store cards switched to credit cards without any new agreement being signed. Now would I be right in thinking Santander were dumping their toxic waste??? When Arrow took over they changed the entry on the credit files as expected but changed the ‘start date’ to the date the store cards became credit cards! Since then it is the usual tripe about ‘not the owner in that sense’ when they are asked for copies of agreements etc.

 

By the way, I feel I must say that this site and LB are actually doing more for people on the verge of cracking up then all the Valuim in the world. I want to repeat here what I said on LB; my nephew is a psychology graduate and he set up a website for people who feel suicidal and for friends and family of those who are left behind. Within a few weeks he had 500 regular contributors. Naturally all discussions are confidential but he did say that debt played a large part in a terrifyingly high number of cases. It is no exaggeration to say that websites such as this save lives and everyone who takes the time to read a comment and reply is a saint.

[rebel11]

Sounds like there's a lot going on which shouldn't be going on. They will no doubt hide behind 'it is commercially sensitive nature'. The Minister for Consumer Affairs is the right official to look into this matter. Even better if you can put this before a Select Committee.

 

http://www.parliament.uk/about/how/committees/select/

 

http://www.csaconsumers-uk.com/media/editor/file/Fact%20sheet%20-%20debt%20purchase.pdf

 

A petition would be a good idea.

[PAWS]

Spot on Rebel 11! I know things will never be perfect but let’s try making them a little fairer.

[citizenB]

If your two accounts were store cards upgraded to credit card without a new agreement being put in place, then I think

 

Santander v Mayhew would come into play..

 

http://www.consumeractiongroup.co.uk/forum/showthread.php?413394-Santander-v-Mayhew-Judgement-in-favour-of-Consumer-Store-card-upgrade

 

So yes, your assumption is correct, Santander are dumping toxic debt.

[Mike_hawk]

I think it goes much deeper, where does a profit centre end for the business and where does a cost centre begin? RBS were the instigators of the slicing and dicing regime a good 15 years ago and many appear to have followed its lead. There is no nett loss for the original creditor if it keeps its fingers in enough pies.

[dx100uk]

sounds just like link financial and Paul Burdell

[PAWS]

I have just read the following in This is Money PUBLISHED:22:02, 29 March 2014 - (ok I am a bit late but hey, I am doing my best!)

Business is booming for debt collectors snapping up overstretched borrowers for as little 10p in the pound Government bodies are also likely to sell more debt in years to come. Last November the Government sold a swathe of student loans with a face value of £900 million for £160 million to Erudio, a company backed by stock market-listed debt collector Arrow Global

And felt I had to send the following email to David Cameron and Nick Clegg. (Signing with my real name of course!)

You sold government debts to a company that repeatedly breaks lending regulations, ignores OFT guidelines and feeds on misery. Shame on you.

Bad debtors are not bad people. Not all have racked up debts by buying Gucci Handbags and mobile phones. Some have had to use their credit cards or get loans for emergencies such as boiler repairs or children’s clothing. Even when they avoid the so called loan sharks and go to high street lenders they are treated like criminals the moment they cannot meet repayments. The loan is sold on to companies such as Arrow who are as bad, if not worse than some of the sharks. They often take action that actually prevents the debtor from improving their situation. There are many cases and literally stacks of information available to prove that debtors are being treated unfairly by what you consider to be the more reputable organisations and I can certainly back up everything I write here with hard evidence and specific cases. You are endorsing a company that is literally pushing people over the edge. How are we to get companies like Arrow global to act in a legal and moral way when you are giving them such a vote of support? Just remember that every one of those debtors who you are ‘blanket judging’ and casting down into a pit of horror and despair is a voter.