Default Notice Query

Lashes1814 · 17 October 2019 at 9:37AM

Hello All.

I opened a Shop Direct Account (Very) in 2010 and another Shop Direct Account (Littlewoods) in 2011. Was just about making payments when I had to eventually deal with my debt (PD Loans and large Credit Card Bills) head on and entered a DMP in December 2011.

Whilst on a DMP I was notified that the Shop Direct Accounts were being managed by Arrow Global Ltd.

I stopped making payments to my DMP sometime in 2015, as I was going through a personal crisis at the time.

I have really started to now pay more attention to my debts and credit file, when I noticed that defaults were registered against the Shop Direct Accounts in 2015.

I thought defaults were registered in 2011 and contacted Shop Direct/Arrow Global Ltd about this. I escalated my complaint to FOS and long and short of it was that Shop Direct had actually sold the account to Arrow Global and that no default was registered before it was sold. Arrow Global only registered a default because I stopped making payments on the DMP.

FOS didn’t think it was fair to ask Arrow Global to amend the default date as they didn’t own the account at the time.

My questions are:
1. Can a debt be sold to a DCA even if no default had been registered.
2. Can a DCA register a default on an account they have purchased if there was no default already registered.
3. Is it worth me pursuing a complaint about the default and when it should’ve been registered.

If posters do feel there is some merit in getting the default date changed can someone point me in the right direction of what information I need to request etc.

Thanks.

boo_star · 17 October 2019 at 9:54AM

1. Yes
2. Yes
3. Not with Arrow.

You'd need to contact Shop Direct to get them to register the default, and likely pass this onto Arrow to amend their records. I would say that you have a good argument for the default being registered when you entered the DMP at the latest.

Lashes1814 · 17 October 2019 at 10:19AM

Ok. Thanks for the reply. I will def contact Shop Direct and will revisit the thread once I receive their reply and if I need further advice.

Just for future reference, as I was reading other threads before posting my own, my impression was that before a debt could be sold it needed to be shown that there was a breakdown in the original contract ie no payments made leading to a default being registered and that debts are normally sold or passed on for collection once a default has been registered.

boo_star · 17 October 2019 at 10:33AM

Lashes1814 wrote: »

Ok. Thanks for the reply. I will def contact Shop Direct and will revisit the thread once I receive their reply and if I need further advice.

Just for future reference, as I was reading other threads before posting my own, my impression was that before a debt could be sold it needed to be shown that there was a breakdown in the original contract ie no payments made leading to a default being registered and that debts are normally sold or passed on for collection once a default has been registered.

No, a debt can be sold on at any time.

Even debts that are completely up to date with no issues at all in the history can be sold, for example the lender decides to shut up shop or not offer this product anymore. Tesco Bank recently stopped offering mortgages and sold on their entire mortgage portfolio to Lloyds. Not a DCA but there is no distinction between another lender and a DCA.

Willing2Learn · 17 October 2019 at 11:24AM

If a debt is sold to a debt collector, then the new creditor should use the same default date as the original creditor did. If the original creditor didn’t add a default, you can ask the original creditor to add one, then the debt collector will have to use that.

If the original creditor didn’t report to a credit reference agency at all (this is unusual) then the debt collector should apply the same ICO rule that the original creditor would have used.

There is ICO guidance that states an account should be defaulted when it is 3-6 months in arrears.

An account does not need to be defaulted before it is sold to a DCA.

On the basis of all of the above, I would make a complaint to the ICO as it could be argued that Arrow should have recorded the default date backdated to when you were originally 3-6 months in arrears of the original agreement. (Obviously, you need to complain to Arrow in the first instance, and then escalate the complaint to the ICO should the complaint not be upheld).

[Deleted User] · 17 October 2019 at 11:40AM

Shop Direct should had the default first then Arrow should follow suit.

Lashes1814 · 17 October 2019 at 11:45AM

Ok thanks for the replies will contact Shop Direct and go from there.

Default Notice Query

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