Consumer Credit Licence

[tbern123]

Thanks,

 

but the problem is that DCA's say they are not the creditor for the purpose of the CCA as they have only been assigned the rights and not the duties of the agreement. As such they say they are only the assignee of the agreement and not the creditor.

[pmhcfc]

Thanks,

 

but the problem is that DCA's say they are not the creditor for the purpose of the CCA as they have only been assigned the rights and not the duties of the agreement. As such they say they are only the assignee of the agreement and not the creditor.

 

If we're talking about 1 particular DCA then it's a simple case of 'stalling'. They know they are on the back foot and are just elongating the process, I'm wondering in which particular act I'll find the section that refers to the fact that an asignee has to pass any CCA sent to them, onto the creditor.

 

I'm trying to clarify something here..If (for e.g.) Cabot Europe are insisting they are the assigned, then it's only them who can bring action against you, no? If Cabot Uk has assinged everything to Cabot europe, then how can cabot uk enforce any action? Once assinged, then Cabot Uk's only role is to provide things like the CCA request etc..Therefor, by rights, if one has a claim for charges, you can theoretically claim of Cabot Europe.

It's a statutory right for Cabot UK to supply the info one requests in a CCA, so one has to send them the CCA...

[Seahorse]

Subscribing.

[tbern123]

If we're talking about 1 particular DCA then it's a simple case of 'stalling'. They know they are on the back foot and are just elongating the process, I'm wondering in which particular act I'll find the section that refers to the fact that an asignee has to pass any CCA sent to them, onto the creditor.

 

I'm trying to clarify something here..If (for e.g.) Cabot Europe are insisting they are the assigned, then it's only them who can bring action against you, no? If Cabot Uk has assinged everything to Cabot europe, then how can cabot uk enforce any action? Once assinged, then Cabot Uk's only role is to provide things like the CCA request etc..Therefor, by rights, if one has a claim for charges, you can theoretically claim of Cabot Europe.

It's a statutory right for Cabot UK to supply the info one requests in a CCA, so one has to send them the CCA...

 

It is not just Cabot, I have also read in other threads. DCA's are saying that they are not in breach of section 77 / 78 of the CCA, as they are not the creditor for the purpose of the act. They say they only provide copies of agreements to help their customers.

 

I believe that they are the creditor, I just need to prove it in law

[Seahorse]

I'm hoping trading standards might clear that up for me soon.

[tbern123]

Do people think that this has any relevance ?

 

Unfair Terms in Consumer Contracts Regulations 1999

Statutory Instrument 1999 No. 2083

 

SCHEDULE 2

INDICATIVE AND NON-EXHAUSTIVE LIST OF TERMS WHICH MAY BE REGARDED AS UNFAIR

 

1. Terms which have the object or effect of-

 

(p) giving the seller or supplier the possibility of transferring his rights and obligations under the contract, where this may serve to reduce the guarantees for the consumer, without the latter's agreement;

[tbern123]

This is also very interesesting

 

There is a problem with the existing coverage of the licensing regime. It is not clear that businesses that purchase a portfolio of existing loans require a licence. The Department of Trade and Industry, the Office of Fair Trading and advice bodies have received complaints about businesses that purchase existing debts. Consumers are often confused about who is responsible for the contract and what controls there are on those businesses.

 

House of Commons Standing Committee d

 

Are DCA, acting as debt colletors ?

[tbern123]

Am I getting close ???

House of Commons Standing Committee d

Under clause 23, a debt purchaser who became a creditor or owner when he purchased the loan would require a licence. However, if the creditor or owner subcontracted the administration of his loan agreements to a third party, clause 24 means that the third party would require a debt administration licence. The combination of clauses 23 and 24 is important, as it will ensure that the OFT can protect consumers throughout the life of their agreement.

[tbern123]

Just had a thought...

 

Is the wording of the CCA important ???

 

i.e rights and duties

 

It doesn't say and/or it clearly says and

 

Could this be interpreted to mean that you cannot assign one, without the other ?

[pmhcfc]

Just had a thought...

 

Is the wording of the CCA important ???

 

i.e rights and duties

 

It doesn't say and/or it clearly says and

 

Could this be interpreted to mean that you cannot assign one, without the other ?

 

Good point...How can we find out for sure ?

[rosierose]

Thanks guys, but trust me I have read the CCA to death

http://www.consumeractiongroup.co.uk/forum/statutes-library/27535-consumer-credit-act-1974-a.html

 

I was hoping Rosie might find me something from Hansard, that clarified the definition of a creditor... DCA's state that s189 doesn't apply to them

 

Haven't forgotten you Tbern... still looking

[rosierose]

House of Commons Standing Committee d debating the Consumer Credit Bill in 2005 mention the s189 definition almost verbatim and further justify the position...

 

The clause amends the definitions of consumer credit business and consumer hire business. These definitions are important, because under section 21 of the Consumer Credit Act 1974, anyone who wants to conduct a consumer credit or hire business needs a licence. Amending the definitions changes the activities for which a licence is required.

There is a problem with the existing coverage of the licensing regime. It is not clear that businesses that purchase a portfolio of existing loans require a licence. The Department of Trade and Industry, the Office of Fair Trading and advice bodies have received complaints about businesses that purchase existing debts. Consumers are often confused about who is responsible for the contract and what controls there are on those businesses.

That is important because consumer detriment can arise from the way in which agreements are administered. Administering agreements can include varying the interest rate or changing the terms of the agreement, and agreements regulated by the 1974 Act can continue for many years. It is appropriate that a licence should be required to administer agreements. The OFT can then check that the person is fit to do so and regulate that activity.

The clause also ensures that a consumer credit or hire business will not be able to enforce its agreements once its licence has been revoked. That will help to avoid the situation which arose in the recent case of Mr. and Mrs. Meadows. As the lender was only administering the agreements, the OFT was unable to intervene.

Hon. Members will see that the definition of consumer credit business now covers businesses relating to the provision of credit by a person, or otherwise being a creditor. A creditor is a person who provides credit under an agreement or a person to whom the rights and duties under the agreement have passed by assignment or operation of the law.

The new definition ensures that businesses will need a licence even if they are no longer making new agreements. They will need a licence if they only administer existing agreements by taking over the rights and duties of the creditor. The same logic applies for the new definition of consumer hire business. The clause means that creditors exercising rights under an agreement are now within the regulatory regime. It means the OFT can ensure appropriate standards and protect consumers throughout the whole life of their agreement.

 

Hope that is what you might have been looking for

[Seahorse]

I rather think this is the kick in the nads that someone so richly deserves.

 

I think I'm going to pay a little visit to the court this afternoon.

 

Rosie, you are a STAR!!!!!

[rosierose]

I rather think this is the kick in the nads that someone so richly deserves.

 

I think I'm going to pay a little visit to the court this afternoon.

 

Rosie, you are a STAR!!!!!

 

I really needed to find that too. Prior to an action that might take place in a week or two. Thanks for the tip SH

[pmhcfc]

I really needed to find that too. Prior to an action that might take place in a week or two. Thanks for the tip SH

 

I spent 2 hours looking for this the other night! Well done Rosie!!! _ and another thing, they again say They will need a licence if they only administer existing agreements by taking over the rights and duties of the creditor.

 

So its for certain that one goes with the other!! tick tock tick tock :grin:

[rosierose]

It means the OFT can ensure appropriate standards and protect consumers throughout the whole life of their agreement.

 

Seems pertinent too!

[pmhcfc]

Seems pertinent too!

 

Just one dumb question from me..This bill isn't law yet is it? When I was looking for this the other night I'm sure I read somewhere that one of the MP's had said it took 10 years to get the CCA through parliment.

[rosierose]

No indeed, but what's important is that they were talking about the CCA 1974 accepted meaning of "creditor" and how it applies to DCA's etc.

[meshi]

I have done some research into this and I have come to the conclusion that a Debt Collection Agency requires a Licence as they give people time to repay money.

 

Now there is a point to this thread, I am looking for people to either confirm or correct my thinking.

 

By allowing people to pay money back over time, they are providing people with financial accommodation

 

The CCA states:

 

9 Meaning of credit

(1) In this Act “credit” includes a cash loan, and any other form of financial accommodation.

 

Bearing this in mind, would I correct in assuming that a Debt Collection Agency provides a form of credit ?

 

DCA's do not provide credit.

 

As I said previous mate DCA's need a licence because section 145 lists it as an ancillary business and 147 say this ancillary businesses are subject to the licensing regime.

[tbern123]

Does anyone know if Consumer Credit Directive 1986, has been incorporated into English Law ?

http://www.fecma.com/Documents/ConsumerCreditDirective87102EEC.pdf

Article 9

Where the creditor's rights under a credit agreement are assigned to a third person, the consumer shall be entitled to plead against that third person any defence which was available to him against the original creditor, including set-off where the latter is permitted in the Member State concerned.

[rosierose]

DCA's do not provide credit.

 

As I said previous mate DCA's need a licence because section 145 lists it as an ancillary business and 147 say this ancillary businesses are subject to the licensing regime.

 

meshi, can you give us a real world example of your assertion; a judgement, some piece of case law?

[InKogneeToh]

Hi all

 

Have just come across this thread and see that you are still debating this Cabot 'not a creditor' phenomenon.

 

I think the Hansard text posted by Rosierose helps to clarify this but there is also more in the CCA itself:

 

S 146

 

6) It is not debt-adjusting, debt-counselling or debt-collecting for a person to do anything in relation to a debt arising under an agreement if—

(a) he is the creditor or owner under the agreement, otherwise than by virtue of an assignment, or .....

 

 

This is saying that if the original creditor or owner is collecting the debt, it is not to be classed as 'debt collecting'.

 

 

But if it is the creditor (or owner) by virtue of assignment, then it is classed as debt collecting.

 

 

But wait, you say, Cabot are saying they're just 'the owner' of the debt so they're not the creditor.

 

 

BUT - the use of the word 'owner' in the section above is defined in the CCA as:

 

 

“owner” means a person who bails or (in Scotland) hires out goods under a consumer hire agreement or the person to whom his rights and duties under the agreement have passed by assignment or operation of law, and in relation to a prospective consumer hire agreement, includes the prospective bailor or persons from whom the goods are to be hired;

 

 

 

So the only logical conclusion is that if assignment does not make Cabot simply the 'owner', they must be the CREDITOR!

 

 

Regards, Pam

[lookinforinfo]

It doesn't look like it. I tried to find it on this site and had no luck.

British and Irish Legal Information Institute

[meshi]

meshi, can you give us a real world example of your assertion; a judgement, some piece of case law?

 

You have to read all of sections 145-147. Tbern was asking why do DCA's need a licence.

 

They need a licence because

1. In section 145 it lists it as an ancillary business

2. In section 147 it states that an ancillary business needs a licence.

 

What InKogneeToh is saying sounds right.

 

The dca becomes the creditor for the purposes of section 189 but is not the creditor for the purpose of the licensing regime as the dca does not provide a consumer credit agreement.

[tbern123]

My main goal is to establish if when a debt is assigned to a Debt Collecttion Agency do they become the creditor.

 

I know the act says rights & duties, but DCA's say that as only the rights have been assigned they are not the creditor.

 

& in this context would suggest that they have to be assigned together for the DCA to become a creditor.

 

However, I have found this case, not a DCA, but it confirms in the eyes of the law that when a debt is assigned the assignee becomes the creditor.

 

http://alpha.bailii.org/cgi-bin/markup.cgi?doc=/ew/cases/EWHC/Ch/2006/2785.html&query="debt+assignment"&method=boolean

 

UNADKAT & Co (ACCOUNTANTS) LTD And ASHOK BHARDWAJ

.V.

The TREASURY SOLICITOR

 

Unadkhat & Co (Accountants) Ltd ("the Accountants") were (by virtue of a debt assignment) a creditor of Isher

 

I am still looking, but what are peoples thoughts ?