Announcement

Collapse
No announcement yet.

Debt purchasers not authorised by the Financial Conduct Authority cannot sue in the county courts

Collapse
X
  • Filter
  • Time
  • Show
Clear All
new posts

  • Debt purchasers not authorised by the Financial Conduct Authority cannot sue in the county courts

    On 24 April 2019 I was successful in a consumer credit claim appeal. The Claimant debt purchaser admitted they were not authorised by the Financial Conduct Authority but said they could rely on the S.55 FSMA 2000 exemption because they had a valid servicing agreement in place with an affiliated 3rd party who was authorised by the Financial Conduct Authority.

    It was accepted on the facts of the case by both parties that there was a valid servicing agreement in place. The issue was could the Claimant debt purchaser rely on the S.55 Exemption to issue proceedings in the county court.

    The Circuit Judge held as a general principle of law that the Claimant debt purchaser was not able to rely on the FCA authorisation of an affiliated 3rd party (and the exemption under s.55 FSMA) for the purpose of bringing a claim. The agreement was unenforceable, and the order of the court below was set aside, and the Claim dismissed
    Legal Disclaimer
    I am a solicitor Advocate who specialises in consumer credit and my firm is Joanna Connolly Solicitors. My leading case of Carey v HSBC set the legal precedence for creditors compliance with s.77 & s.78 Consumer Credit Act 1974 statutory requests & enforcement of debts in court. Any posts I make on the AAD Consumer Forum are for information and discussion purposes only and shouldn't be seen as legal advice. Any advice I provide on the forum is without liability. If you are unsure please seek formal legal guidance or contact your local citizens advice bureau at https://www.citizensadvice.org.uk.

    If you need to contact me you can send me a message by clicking my username or by emailing me at jo@joannaconnollysolicitors.co.uk or by telephoning 0330 053 9340.

  • #2

    Great result, another blow for the debt purchasers, How ide have loved to have seen the ceo"s face once he heard the result )

    I have a couple of debts with Cabot and Intrum so am very interested in these recent developments.

    Why are these debt purchasing companies allowed to carry on issuing court claims if they are not authorised to do so,
    I know they play on the fact that most debtors wont contest the case and they will get judgement by default, but why are the authorities than govern them not clamping down on it , surely its an abuse of process if there is no authorisation in the first place ? even more so now a court has agreed..

    Could these unauthorised debt purchases upon realising they could be challenged in the court on this issue simply just sell the debt on to another company/subsidery who does hold the correct authorisation ?

    Thanks
    Last edited by BigAl1968; 11th September 2019, 11:28.

    Comment


    • #3
      Its a complex legal argument as I understand.

      But anybody can lodge a claim.

      Comment


      • #4
        Originally posted by BigAl1968 View Post
        Great result, another blow for the debt purchasers, How ide have loved to have seen the ceo"s face once he heard the result )

        I have a couple of debts with Cabot and Intrum so am very interested in these recent developments.

        Why are these debt purchasing companies allowed to carry on issuing court claims if they are not authorised to do so,
        I know they play on the fact that most debtors wont contest the case and they will get judgement by default, but why are the authorities than govern them not clamping down on it , surely its an abuse of process if there is no authorisation in the first place ? even more so now a court has agreed..

        Could these unauthorised debt purchases upon realising they could be challenged in the court on this issue simply just sell the debt on to another company/subsidery who does hold the correct authorisation ?

        Thanks
        The problem they have is that there are tens of thousands of these debts owned by non regulated companies. The other point is that only a tiny minority ever get defended let alone by someone who can back up their argument so why not chance their arm and go ahead . If someone instructs Joanna Connolly they can always discontinue

        You do ask a very relevant question- why are they allowed to carry on- why indeed. From my point of view it is called corrupt capitalism but that is just my own personal political viewpoint ( I don't have a quote from Marx in my avatar for no reason)

        Comment

        Who's Viewing Thread: 1 (0 members and 1 guests)
        Working...
        X