Friends had letter 3 years after payout asking for money back

brettcta

So just to triple check on this - it’s the bank that have written to your friend asking for the money to be paid back and not the claims management company?

I wouldn’t waste my time trying to contact the CMC - they’ve been paid and, assuming they’re still in business, will simply tell your friend it’s none of their business and wish them the best of luck. They do very little and what they do do doesn’t involve anything like this.

If that £21,000 was the net amount (PPI refund minus CMC fees) and the bank wants a full refund then your friend’s going to be looking at a bill of around £35,000.

If I have the story correct then, as above, the FOS will be the first port of call. 

theoretica

Are the bank saying they paid the wrong amount and the friend hadn't paid that in PPI (had they in a back of the envelope calculation?) or that they had paid it and weren't eligible for a refund (using a claims company perhaps indicates eligibility wasn't clear cut?)

Chrissyc

brettcta said:

So just to triple check on this - it’s the bank that have written to your friend asking for the money to be paid back and not the claims management company?

I wouldn’t waste my time trying to contact the CMC - they’ve been paid and, assuming they’re still in business, will simply tell your friend it’s none of their business and wish them the best of luck. They do very little and what they do do doesn’t involve anything like this.

If that £21,000 was the net amount (PPI refund minus CMC fees) and the bank wants a full refund then your friend’s going to be looking at a bill of around £35,000.

If I have the story correct then, as above, the FOS will be the first port of call. 

Hi spoke to them tonight. The bank have written to them to say they made a mistake. Unsure if they were due any ppi payout or they paid the wrong amount though. My friend has contacted the cmc and they said to forward a copy of the letter to them. The £21,000 was before the cmc's commission so they paid the cmc £10k and they got £11k. Apparently it was for 4 or 5 claims with the same bank that was consolidated into 1 claim

Chrissyc

theoretica said:

Are the bank saying they paid the wrong amount and the friend hadn't paid that in PPI (had they in a back of the envelope calculation?) or that they had paid it and weren't eligible for a refund (using a claims company perhaps indicates eligibility wasn't clear cut?)

The cmc are still in business and were paid £10k commission out of the £21k. They have asked for a copy of the letter as it will obviously affect any commissions they have received

brettcta

Good luck getting a penny off a CMC.

RandomUserID

brettcta said:

So just to triple check on this - it’s the bank that have written to your friend asking for the money to be paid back and not the claims management company?

I wouldn’t waste my time trying to contact the CMC - they’ve been paid and, assuming they’re still in business, will simply tell your friend it’s none of their business and wish them the best of luck. They do very little and what they do do doesn’t involve anything like this.

If that £21,000 was the net amount (PPI refund minus CMC fees) and the bank wants a full refund then your friend’s going to be looking at a bill of around £35,000.

If I have the story correct then, as above, the FOS will be the first port of call. 

As has been said already, what do you think the FOS would do here?

The bank is entitled to its money back if it paid it out in error.  This is a matter of law and the FOS won't even go anywhere near trying to make decisions the supersede the law.

So you're left with the friend having to agree to a repayment schedule, which has already been suggested, at least twice.

dunstonh

Given the amounts involved, I think a solicitor is the best option here. 

The old "bank error in your favour" card is a myth.   Mistakes do not entitle you to keep the money unless there is a reasonable expectation.    It may be possible to prove that but in most cases it is not.

Dealing with the CMC is going to be difficult.  However, CMCs are now regulated by the FCA.  That means access to the FOS is available. (assuming its not a CMC that has gone down the legal route rather than the financial route).  I suspect the FOS would demand a refund as the contract almost certainly is based on x% of the amount awarded.   

This issue has multiple facets to it and multiple companies involved.   I wouldn't want to be in their shoes but they do need to start preparing for the worst.   

Chrissyc

dunstonh said:

Given the amounts involved, I think a solicitor is the best option here. 

The old "bank error in your favour" card is a myth.   Mistakes do not entitle you to keep the money unless there is a reasonable expectation.    It may be possible to prove that but in most cases it is not.

Dealing with the CMC is going to be difficult.  However, CMCs are now regulated by the FCA.  That means access to the FOS is available. (assuming its not a CMC that has gone down the legal route rather than the financial route).  I suspect the FOS would demand a refund as the contract almost certainly is based on x% of the amount awarded.   

This issue has multiple facets to it and multiple companies involved.   I wouldn't want to be in their shoes but they do need to start preparing for the worst.   

They have been in touch with the cmc and they have sent a holding letter to say they are investigating it. Doesn't look good for them though and they now wished they hadn't even tried to claim ppi now. They checked and double checked that the amount was right with the bank before they cashed the cheque and that's what they are the most upset about. Looking more like a payment plan will have to be sorted as they renovated their kitchen with it 3 years ago.
Thanks for all the comments and advice