Wrongly defaulted by HFC

[boxbeau]

Hi there wondering if anyone out there can help me at all?

 

I had a loan with a HFC, only a small £2000 loan over 2 years my first ever to be truthful. I have never wanted a credit card, always had my bills paid on time so i thought i was quite good with my money. I changed bank accounts, set up a new direct debit mandate with the HFC who loaned me the money. 4 weeks later, i had a phone call from the bank asking to pay my months repayment as they had not received the mandate. This I did by way of switch card, asking them to set up a direct debit over the phone. They said no problems and took my bank details. 2 months later the bank sends me a letter stating that I must pay two months repayment as the money had not gone through the direct debit i had set up with them over the phone. To say I was miffed could be classed as an understatement. So i rang them up again, paid 2 months of repayment over the phone, asking them to set up the direct debit again, explaining that i had done this twice already. They even had a record of the telephone conversations.

3 months later, i receive a letter saying they had defaulted me.....I was fed up at this stage. After getting on to the bank in 2004 and explaining to their litigation department, they sent me a letter admitting liability, quoting " This was an error made on behalf of HFC bank, and you therefore should not have had a default notice registered against you.". I Thought great its done with now they are sorting this out. This was in June 2004. In december 2004 I applied for a hire purchase agreement on a £6000 piece of equipment, which i was refused as on my credit file it showed I had defaulted. I explained on appeal that this default was wrongly entered and immediately contacted the bank who had defaulted me. In january 2005 the bank again apologised and informed me "We did request your default be removed in June 2004, but it appears this was not updated and in view of this we have made a business decision to delete the entry from your credit file"....the only thing is my credit score went from exceptional to very poor and i have been spending the past 3 years trying to build up my credit worthiness. I am loathed to apply for any loans now as my credit rating is still classed as poor to fair. Are the bank in question responsible? Can i or should i take legal action against them....can anyone help...i think they have a duty to at least make good what they have created

[boxbeau]

just thought, as the yadmitted fault, surely any charges they added to my account for the admin fees and late payment interest are owed to me...

[Scooby_Doo2]

Going on the information you have provided, along with your letter (which I hope you still have) proving the default was registered wrongly, you have a very strong case for not only getting back any charges, but also compensation for the way you have been treated by them.

 

HFC Bank Ltd have an obligation under the Data Protection Act 1998 to ensure information about you is accurate and up to date (this is one of the principles of the Data Protection Act). It looks fairly obvious to me that HFC have failed miserably on this occasion.

 

As HFC are regulated by the Financial Services Authority, they are also obliged to comply with the FSA's Principles for Businesses - principle 6 being to pay due regard to the needs and interests of customers and to treat them fairly. Again, they have failed miserably on this occasion.

 

Failing to setup a Direct Debit is a common administrative error that occurs at HFC - once you've signed the legal agreement and taken the money, the after sales care is non-existent. But there is no excuse for having no systems or controls that prevent a default notice from being wrongly issued.

 

Wrongly issuing a default notice is a serious problem and has severe consequence for the customer. It can cause you an untold amount of problems when trying to obtain credit, forcing you to take higher interest rates as you are seen to be a higher credit risk.

 

The first thing I would do is write a formal letter of complaint. Detail everything that happened in a chronological order and explain what you want done about it. I personally would be asking for considerable compensation if I had been forced to take higher rates to rebuild my credit history.

 

The rules regarding the handling of customer complaints is quite strict on the banks. They will send you a leaflet upon receipt of your complaint which will explain their own internal process, and your right to refer the matter to the Financial Ombudsman Service if you remain dissatisfied with their response.

 

Point of fact: It is entirely HFC Bank's responsibility to ensure they provide accurate data to the credit reference agencies. Get a copy of your credit file from Experian (try Experian Credit Expert, check credit rating, credit reports & file alerts - with Experian CreditExpert.co.uk for their 30 day free trial) and see exactly what is held there. Experian will not change the data they hold unless they are told to do so by HFC Bank. Had HFC told Experian to remove the default, it would have been done.

 

I'd be more than happy to look over any complaint letter you want to send before you send it - if you feel you need help with it of course

 

Hope this helps.

[boxbeau]

Hi Scooby, may I thank you sincerely for taking the time to read through and reply to my enquiry. I have been mulling over this for a few years now, and to be honest I thought I would be fighting a lost cause. Having spoke to the bank back in December/January 2005 I was just happy to get the default removed, but in hindsight if I had known the problems that it would cause, I dont think I would have been fobbed off by the bank. It was actually Hamilton Direct who I had the loan from, I believe they were taken over by HFC or HSBC.

The letter you refer to is still in my posession. This was sent by the litigation department Birmingha,, it reads

 

Dear.......

As per our telephone conversation today, I have reviewed your account and can see that you have made payments on a regular basis in accordance with the terms and conditions of the agreement you signed.

 

It appears the situation was not helped when your direct debit mandate was cancelled when you moved address(??????????) and agree this was an error made by HFC Bank LTD and you, therefore should not have had a default notice registered against you. We did request your default be removed in June 2004 but it appears that this was not updated and in view of this, we have made a business decision to delete the entry from your credit file.

 

Should you have any further queries please do not hesitate to contcat me on............

 

............. Litigation Officer

 

I also have three other letters i sent the litigation department with all the names of the people I spoke with, having just gone through the archives on my computer, so these letters back up to the point the hassles and even the mental state i was in when writing them. I even make mention to a conversation I had with a lady from Equifax who told me that because my credit file hade been deleted, even though the default had been removed it had made we un credit worthy. I spoke to litigation yesterday and gave them my account number to see where i could get copies of all my dealings with Hamilton/HFC but was told I had to send off £10 for a sar??? as the litigagtion Department could not access my old account details.

If there is hope for compensation, dont get me wrong I am not looking to be a freeloader, but as you say and i have seen first hand, its the problems I have had when trying to obtain credit over the past few years....

 

Sccoby, once again you are a legend for responding. I would appreciate your input on the wording of the complaint and the way to go forward. If you dont mind that is....

 

Regards

[Scooby_Doo2]

Of course I don't mind!

 

If you construct the bones of the letter (what happened etc), I'll add some meat to it! Send me a private mail with the letter if you want, then I'll do some work on it then I'll leave it up to you if you want to post it on this thread.

 

Just remember to leave out any personally identifiable information.

 

Also, HFC deleting their whole entry in your credit wasn't the best thing for them to do, but they probably thought it was at the time. If you have no payment history for any accounts on your credit file, this can cause problems with obtaining credit and you are an unknown quantity to the lender - they can't tell if you're a good payer or not.

 

The best thing for HFC to have done is to update your account as being paid on time each month. This establishes your credit worthiness and lenders would be a little less cautious with lending to you.

[boxbeau]

Thanks scooby, yes they did delete the whole entry, and thats what caused the problems, as the lady from equifax said, i would not get credit because i had no credit files to show my worthiness.....I shall begin to construct the letter and will e mail you the letter when complete, once again, many thanks for your help scooby,

[boxbeau]

Morning Scooby, are you awake

I have written out the letter, shall i send through message to you?

[boxbeau]

Right, my letter has been posted to HFC, its been faxed, and its been e mailed...i couldnt find a pigeon to fly a copy there so I hope they receive one of them

[Sparkie1723]

Boxbeau,

You should also write to the CRA's and ask them what kind of compensation are they going to offer you as ...Under the new data protection act 1998 CRA's are now classed as Data Controllers NOT data processors and have a duty to all data subjects to take more than reasonable steps to ensure that information they process is indeed accurate true and correct,they can NO LONGER claim that they believed it was correct because the supplier had said so, if the derogatory info was viewed by third parties it falls under the libel act and there is a privy counsel ruling that CRA's are not immune from the Libel Act, I have posted info about this on other threads dealing with defaults and C.C Judgements.

Libel action can be taken in the County Cort now it does not have be in the high court, but it only has a 12 month timescale , but action for defamation making negligent miss statements carrys a three year time scale. and

under the libel (defamation Act) you do NOT have to proove loss , if your credit status has been damaged and youcan prove it..... you can sue if the action is stated within 3 years of the last time you were "defamed" and in the COUNTY COURTS

 

sparkie1723

[boxbeau]

Had a phone call from them yesterday and they offered me £250 compensation......they hadnt looked at the fact they unlawfully defaulted me and the record was unlawfully on my credit files for 11 months.....not to mention that they still had the nerve to add charges because of their appliance of the default which they had not taken into account.

[Sparkie1723]

Contact HSBCagain only this time quote the Libel Act(Defamation of Character,) making negligent miss statements, and you believe that court would award you much more than £250 for defamation ( you can do it through the County Court now) the problem is you have to have your claim in before 3yrs are up so you have not got very much time, also you donot have to prove financial loss under the LIbel Act ony damage and you have that ....defamation by saying you were a debtor when you weren't.

Bluff them and see what they say they might not ealise the 3 Yr limit at first.

 

sparkie

[boxbeau]

Good Morning all, on this wonderful summers day.....at last. Just an update to my saga with the lovely HFC/HSBC/.....whoever they may be. As I am in a totally different position in respect of being unable to claim bank charges, the latest news is this. I received a personal response from the Chairman of HSBC stating that he had forwarded all my correspondence to the internal complaints department. Funnily enough I had a phone call from the complaints department the same day and they did not have any records of my account available as they had been "filed" on a old computer system and could not access the details on the new system. However, a few days later they sent me a letter stating that they were sorry to see i remained "dissatisfied" with HFC. Again they admit they were at fault as they did not remove the "adverse" information from my credit file as and when they were asked to. They are still more than happy to recompense me for any monetary loss I have suffered and they will require written evidence. However as a gesture of goodwill they said....quote...."we would like to offer you £250 in recompense of the adverse information not being removed from your credit file". Along with this came a form for me to sign accepting the offer.....suffice to say that i have played noughts and crosses on said paperwork.

I spoke with the Financial Ombudsman Service, they advised me not to sign and to send any relevant paperwork to them, the chappie I spoke with was very very helpful. Its now in the hands of the FOS. I have stated my concerns regarding HFC's duty of care to their customers, all said copies of documentation and look forward to what the FOS find. In all honesty I felt rather good after my chat with FOS and reading between the lines, the case worker has told me that HFC have totally ignored the Data Protection Act and regulations governed by the FSA.

What gets to me is the way HFC admit fault in the way they have treated me, they admit full liability in treating me wrongly, unfairly and with predjudice, but offer me £250 as a gesture of goodwill. I wait with baited breath to see the next episode of this saga, perhaps HFC should start to care more about their customers and ex customers.

[kittyo]

Hi boxbeau,

 

My husband is in a very similar situation to yours, and we are trying to get a mortgage...

 

I know your posts were a long time ago, so I don't even know if you'll receive this msg, but just in case, how did you get on with the FOS? I have a terrible terrible feeling after reading lots on here today, that we have nothing to go on, because the bank contacted us by phone and didn't admit anything in writing. We sent a letter a couple of weeks ago (before joining CAG ) and apparently they can take up to 8 weeks to reply to a complaint! I'm going mad here - wondering!!

 

Any info you have would be much appreciated - thanks!!