PPI Claims after bankruptcy

HannahT_3

To be honest, I probably know the answer to this question but ....

I had a credit card with PPI for many years but was self employed which they were aware of but until recently didn't realise it was pretty worthless anyway. Anyway, about 4 years ago I managed to pay off the credit card but unfortunately 2 years ago I was made bankrupt and discharged soon after.

If I were to try and claim back the PPI would the OR still be entitled to any refund even if it was payed off 2 years before the bankruptcy?

Like I said, I probably know the answer, just want it confirmed.

PippaGirl_2

Yes it belongs to the OR

mrsg2b

Further to my question concerning Bank Charges refunds, I spoke to my Insolvency Practitioner, who had said since Im discharged from trustee, and because of the small amount in question they would not be looking to take a single penny, and I am entitled to it in full.
However RBS have said in that case they will keep the money to offset against the debt! Going to fight it as IP have said thats wrong, there is no debt, its completely discharged so they cannot keep the refund. Insolvency dept at RBS have even said they believe it should be refunded straight to me but they have no power to dispense it, it has to be refund team. He reccomended I speak to Financial Ombudsmen, and even as far as small claims court! According to Bank and IP bank charge refund for a fully discharged bankrupt is different to PPI.

[Deleted User]

mrsg2b wrote: »

However RBS have said in that case they will keep the money to offset against the debt!

I'm afraid the Bank are perfectly within their rights to do this. I wouldn't be wasting any money on court fees if I were you.

You could try convincing the Bank that you have more pressing debt elsewhere, but being bankrupt previously wouldn't help with that.

You can certainly also approach FOS, but I doubt they'd side with you in this circumstance.

http://www.moneysavingexpert.com/banking/setting-off

safestored4

Give over. What you appear to want to reclaim is a refund of money that you never paid in the first place.

debtinfo

I have coppied 2 paragraphs from the Official Receivers Technical Manual for you below, basically the first says that the bank charges are an asset in the bankruptcy like PPI but may not be worth the trustee chasing which is basically what your IP has said. This is not to be confused with saying that they are not assets, they are assets just may not be worth chasing, therefore it is the trustees decision on whether to chase them or not.

The second is about the right to set off, if it is technically an asset as above, then it existed at the date of the bankruptcy and so the bank can set it off as long as they retain the original debt (ie they have not sold the debt on)

31.9.31a Dealing with a claim for the recovery of bank charges (added February 2011)
A claim for the recovery of bank charges is restricted to those charges levied as ‘service’ charges against the account(s) of the bankrupt. This is based on the premise that charges such as ‘default fees’ and/or ‘late payment fees’, which often resulted in a levy of in excess of £25, did not reflect the value of the ‘service’ received (that is, it did not cost the sum charged to administer the fee and/or issue notification of it by post).
The period for which charges can be recovered is limited to six years prior to the date of the claim (see paragraph 31.9.143).
To successfully pursue a claim, it is usually necessary for the claim to include copy statements highlighting the ‘excessive’ charges. For this reason (as well as the ‘set-off’ point – see paragraph 31.9.208), there is generally no benefit in pursuing such a claim, unless the bankrupt is in possession of statements which already are, or may easily be, annotated in the required manner.

31.9.208 Right of set-off (amended February 2011)
In cases where the insolvent has a claim against a creditor, any award will be subject to automatic set-off and the official receiver’s claim, as liquidator or trustee, over the monies will extend only to any surplus after set-off. Set-off only applies where there are mutual credit and debits as at the date of the insolvency of the company or date of bankruptcy so, in cases where a claim is against a creditor and that debt has been sold on by the creditor prior to that date, set-off would not apply URL="http://www.insolvencydirect.bis.gov.uk/freedomofinformation/technical/TechnicalManual/Ch25-36/Chapter31/part9/part9/part%209%20notes.htm#13"][COLOR=#0000ff]note 13[/COLOR][/URL URL="http://www.insolvencydirect.bis.gov.uk/freedomofinformation/technical/TechnicalManual/Ch25-36/Chapter31/part9/part9/part%209%20notes.htm#14"][COLOR=#0000ff]note 14[/COLOR][/URL.
Set-off is mandatory and will normally be automatically applied by the creditor. In some cases (particularly in PPI claims – see paragraph 31.9.61), the creditor may choose to forgo the right of set-off and, in such a case, the official receiver should claim the monies awarded. (see Chapter 40 Part 3).

dunstonh

troosers wrote: »

Exact wording reads,
I refer to my appointment as Trustee in your insolvency which I appreciate may have been finalised some years ago.
I write to advise you that, although it is unlikely you did not pay off your creditors in full,you may still be entitled to a repayment of mis-sold payment protection insurance. In general Banks are not allowed to set-off payment protection refunds due from mis-selling against outstanding debts. Accordingly you should be in no different position than any other individual pursuing these claims.
This was followed by
My own firm has employed a company who specialises in recovering PPI, BLAH, BLAH, If you decide that you would wish this company to act on your behalf I can ask them to contact you.
The letter is dated 4 April 2012 and I contacted the Trustee on receipt of the letter.

That letter is dodgy. The position on PPI redress payments is very clear. PPI paid pre-bankruptcy is an asset that should be paid to the official receiver to distribute to your creditors.

mrsg2b

Received my cheque this morning from RBS for bank charge refunds and interest of £257 :-) I had suspected that any debt on the account at the time of insolvency was far less than the refund, when I asked RBS what the debt had been they admitted it was only £16 and therefore I was entitled to the refund minus that amount! I am glad I didnt give up as advised! x

dunstonh

mrsg2b wrote: »

Received my cheque this morning from RBS for bank charge refunds and interest of £257 :-) I had suspected that any debt on the account at the time of insolvency was far less than the refund, when I asked RBS what the debt had been they admitted it was only £16 and therefore I was entitled to the refund minus that amount! I am glad I didnt give up as advised! x

You still have to advise the OR of the amount received and it is for them to decide. Not the bank. The bank should have sent it to the OR and not you as they dont know what other creditors may exist. A bank error does not entitle you to this money as you have a legal requirement to let the OR know. If the OR says to you that you can keep it then thats fine.

mrsg2b

dunstonh wrote: »

You still have to advise the OR of the amount received and it is for them to decide. Not the bank. The bank should have sent it to the OR and not you as they dont know what other creditors may exist. A bank error does not entitle you to this money as you have a legal requirement to let the OR know. If the OR says to you that you can keep it then thats fine.

It actually came via them, they have no interest in recovering this money and have forwarded a cheque with their compliments!