Spreadbet debt - Enforceable...Court Claim?

[billyrayvalentine]

Got a letter before action letter from a spreadbet company, stating I owe them £3k, as my account is in debit.

I havent used this account for 11 months.

 

The debt was caused by the Swiss National Bank removing the peg, so a small bet (in wrong direction) wiped out my account and more.

 

A bit like this:

 

http://www.telegraph.co.uk/finance/personalfinance/investing/11562202/How-370-investors-lost-18m-in-minutes.html

 

Is this debt enforceable in a County Court?

As its not regulated by a CCA, but it says in their T&C that debit balances need to be made good.

 

What steps should i make next?

 

Billy

[unclebulgaria67]

Yes they can use the County court and say you owe the money per their T&C's.

 

Have you registered any complaint in line with any regulatory requirements for the spread betting company.

Do they have a complaints process, with an ombudsman or body able to review complaints.

If so, you should follow it.

This should prevent any court claims being issued, while any complaint is in progress.

[billyrayvalentine]

Any tips?

 

Cant afford to pay it.

[unclebulgaria67]

Have responded more fully above

[billyrayvalentine]

Ok Thanks. I will complain to them, and see what they say.

I wonder if they are open to a F&F at a very low rate?

[unclebulgaria67]

You could try with an F&F offer, pointing to any issues you had with this companies services.

You could say you are looking to avoid getting involved in protracted complaints with regulators or through the courts.

[billyrayvalentine]

Received a letter today from Igindex solicitors claiming I owe them approx £3k as a result of a spreadbet going wrong.

 

You may remember when the swiss national bank removed the interest rate peg in Jan 15, which caused a crash in CHF-related currencies. It was a cash account I had, which went negative as a result of this.

 

In the letter they state they will go to county court on behalf of their client, and included a draft of the particulars (3 page document) to document their argument against me.

 

I've had debts before and successfully defended a county court case against me for a loan, but i'm a bit stumped as to how to proceed on this one.

 

Thoughts?

 

BillyRay

[AndyOrch]

If you could scan and upload the letter and proposed particulars (suitably redacted) billy.

 

Regards

 

Andy

[billyrayvalentine]

the gist of this case against me is:

 

I opened a spreadbet with them.

There was a sudden geo-political event which caused the spreadbet to go into a loss, and they closed the bet off when the markets opened, crystallizing a £3k loss.

 

I opened the account over the net, and didnt sign any documentation in hard copy.

 

At the moment, the account has been referred to a solicitor who have prepared a particulars of claim against me, but not gone to court yet.

 

I dont know how to fight this one in a legal sense. Ideas?

 

Thanks

 

Billyray

[BazzaS]

Ideas:

a) it wasn't you who opened the account?. But, it was.

b) They didn't warn you that losses could exceed deposits / 'the bet amount'?. Usually, for spread betting they would, though.

 

Are you asking for ideas because you think you don't owe it (in which case why don't you owe it?)

That you think you owe it but it will be unenforceable (again, why?)

Or you think you owe it and they'll be able to obtain a judgment against you, but you are hoping for a "magic wand to wave" to get you off the hook?

 

Ohh, and a previous respondent asked for a (redacted) scan of the correspondence.

Help us to help you.

[unclebulgaria67]

What is their legal basis for closing the bet off ?

 

Was this a reasonable action that could not be avoided ?

 

I think you need to seek advice from people who fully understand the subject matter and can provide reasons for any defence. No point posting to a general forum like this.

[billyrayvalentine]

I had a cash-deposit account with a well-known financial spreadbetting company.

 

The basis of this claim against me is I took out a spreadbet with this company and a force majeur happened, and before I could react they closed my bet at a significant loss, thus crystallizing the debt.

 

I received a draft of particulars (uploaded and redacted) from the solicitor representing the spreadbet company.

 

Any thoughts on this?

spreadbetting POC.pdf

[BazzaS]

Are the particulars correct?

If so, why do you think you don’t owe it?

[billyrayvalentine]

On a technical basis the particulars are correct but i cant afford to pay.

So I am looking for a way to not pay, or pay a vastly reduced sum.

[BazzaS]

It is spread betting.

It has risks, it is a form of gambling.

 

Is it correct they warned you that your losses could exceed your deposit?.

If so, and the particulars are correct, the fact you can’t afford to pay doesn’t stop them enforcing......... or at least trying to enforce via the county court (they can’t get blood out of a stone!)

[billyrayvalentine]

So bearing that in mind, what is the best strategy going forward?

 

Similar to this:

 

http://www.independent.co.uk/news/business/analysis-and-features/how-could-a-teacher-on-18000pa-lose-280000-spread-betting-10115157.html

[BazzaS]

First make sure no-one can come up with a reason they wouldn’t win in court.

 

If none is forthcoming decide : would a CCJ against me be a disaster?.

If not, and you really can’t afford much per month, let them get a CCJ and apply to pay a minimal amount per month. (Can’t get blood from a stone)

 

If you really don’t want a CCJ : let them know you’d ever be made to repay a nominal amount per month. Then offer them slightly more than that, in a consent order (“Tomlin agreement”).

 

If you’d “be paying forever” you might consider bankruptcy, but it is a “nuclear option”, and you’d want them be sure there was no better choice.

 

Similar to this:

 

http://www.independent.co.uk/news/business/analysis-and-features/how-could-a-teacher-on-18000pa-lose-280000-spread-betting-10115157.html

 

If they had a “close-out” minimum that became active : they could argue they had acted to put a limit on your loss.

[BazzaS]

Is this the same Spread bet as in your previous thread:

https://www.consumeractiongroup.co.uk/forum/showthread.php?478283-Igindex-Spreadbetting-debt&p=5055420#post5055420

 

Unless it isn't, shouldn't these threads be merged?

Were you expecting different answers from the last time you asked the same questions?.

[billyrayvalentine]

Yeah if you could merge them that would be great.

[AndyOrch]

Threads merged.

 

Regards

 

Andy