Complaint upheld but setting off to third party

Rangers123

Hi all. New here. Have a real problem with my PPI complaint and don't know what the next move is.

I submitted a claim to Canada Square Operations for a PPI claim on an old Egg loan. I heard back on 16th July that my complaint had been upheld and my total redress was £4589.25.

It also stated that 'as your account is still open, your account will be credited with £940.91 within 20 working days of our receipt of your signed acceptance form, to put your loan in the position it would have been in had you not taken PPI'.

I replied, saying my account with them was not still open, and had been closed many years ago when they sold the loan on.

They replied, saying they 'can confirm the adjustment amount is not being paid into an account open with Canada Square Operations. The adjustment is being paid into your open account with Arrow Global Receivables Management Limited (Arrow). Arrow took charge of the account in May 2005, the information we received from them on 3 July 2014 indicated the account was still open and had an outstanding balance'.

i.e. they're setting it off to a third party.

Since then I've tried in vain via email and phone calls to them to explain that in accordance with the Financial Ombudsman's guidelines and case law that they have no right to set off to a third party company. They simply will not listen, and keep insisting that it's legal and what they are required to do by law.

In addition, shortly after this PPI claim began, I settled what I owed to Arrow Global with a Full and Final settlement, and have a letter from their solicitors, Restons, stating that my account with them has been concluded.

I phoned Canada Square a couple of weeks ago asking them to verify with Arrow Global that my account has been settled, and when I phoned them back today they said they'd contacted Arrow Global who told them a balance was still owed. None of this should matter anyway, but I just want this resolved as it's already dragged on for months.

What's my next move? In my last two emails to Canada Square I threatened legal action. Can I simply file a claim using Money Claim Online for the full amount owed?

[Deleted User]

Rangers123 wrote: »

In my last two emails to Canada Square I threatened legal action.

You can't take legal action against setting off. The debt you defaulted on was taken over by Arrow Global for the purposes of recovery, but this does not stop the redress from being paid into the defaulted account. Your "full and final settlement" will have involved monies written off and it's these which are still outstanding for setting off purposes.
You really should have let sleeping dogs lie.

Setting off rules here;
http://www.moneysavingexpert.com/banking/setting-off

Rangers123

The legal action would be to recover monies owed to me, not specifically against the setting-off part. The link you provided only says that "Most banks have the right to transfer cash from your bank or savings accounts to pay off other debts held with them".

In this case I don't owe any debt to Egg. What I owe to another company is not any of their business. I also owe money on my mortgage, my car loan, probably owe £5 to my sister, but that's nothing to do with Egg/Canada Square.

The Financial Ombudsman's advice specifically states:

But if the debt was sold on to a third party and it cannot be bought back, or the business chooses not to buy it back, we might take a slightly different approach. That is because the consumer does not owe the business money – it owes money to the third party that bought the debt instead. When selling the debt the business made a commercial decision and accepted an agreeable price for the debt. In those circumstances, we would usually tell the business to calculate the compensation as normal at the point it sold on the debt – and to pay all parts of the compensation to the consumer. The business should also consider the possibility that the consumer might have incurred further losses since the debt was sold on as a result of PPI being included on their debt.

I cannot post links but it's on the Financial Ombudsman's PPI redress notes page.

There is also case law on the right of set off which is Edlington Properties v J H Fenner & Co Ltd

[Deleted User]

Rangers123 wrote: »

In this case I don't owe any debt to Egg. What I owe to another company is not any of their business.

I'm afraid it is "their business". Egg clearly didn't sell your debt to Arrow Global, they took it over for the purposes of recovery only.

I won't repeat myself anymore. If you are determined to take "legal action" I suggest you do so. However, you won't get very far IMHO.

Rangers123

I'm not sure I understand the aggression? Egg did sell the debt to Arrow in 2005, nobody is disputing that, not even them. Thanks for your input anyway, I appreciate it all.

[Deleted User]

Rangers123 wrote: »

Egg did sell the debt to Arrow in 2005

They didn't "sell it" in such a manner that they would be prevented from off-setting. That's not the relationship Banks have with their recovery agents.

Do you really think that you can simply agree a settlement involving amounts written off and then obtain redress without it being off set against that unpaid amount?

Why do you think you have any legal (or moral) right to money you failed to pay in the first place?

As I said, take legal action if you want, but I sincerely doubt you'll get anywhere..

Rangers123

Ah, so it's the moral debate. I'm here looking for legal guidance, not moral. As the Financial Ombudsman says, when selling the debt Egg made a commercial decision and accepted an agreeable price for the debt. And if they hadn't mis-sold such a vast amount of PPI perhaps I wouldn't have got into that situation in the first place. But I don't want to get into the morals of banks.

[Deleted User]

Rangers123 wrote: »

I'm here looking for legal guidance

I think you've come to the wrong forum.
Try Legal Beagles.

haras_nosirrah

Imagine you leant a friend £1000 and they couldn't pay you back so you accepted £200 for the problem to go away. They then found a reason that you owed them £1000. Would you go 'here is the full £1000 back' or would you say 'but you only paid me back £200 so I will give you £200 and keep the other £800 against what you owe me.

Option 2 means that you are both square as you have each given the other £1000. Option 1 means that your friend has had £1800 and you have £200. Hardly fair

Rangers123

haras_nosirrah wrote: »

Imagine you leant a friend £1000 and they couldn't pay you back so you accepted £200 for the problem to go away. They then found a reason that you owed them £1000. Would you go 'here is the full £1000 back' or would you say 'but you only paid me back £200 so I will give you £200 and keep the other £800 against what you owe me.

Option 2 means that you are both square as you have each given the other £1000. Option 1 means that your friend has had £1800 and you have £200. Hardly fair

That's a fascinating story.

colonelsensible

You could check the status of your account with a CRA - Experian, Equifax or Noddle. The first two offer 30-day free trials, the last is free.

The account may show as "Settled", or "Partially Settled".

If "Settled", you have a good case.

If "Partially Settled", you need to revisit your F&F documentation, which will help determine what Egg/Canada Square agreed to with F&F.

If "Open", and with Egg/Canada Square, offset may be legitimate.

If the account doesn't show, then it can't be open.