Clear Debt PPI

[Adam Davies]

Hi

I don't agree that debtors should have to wait in some cases for nearly two years to have their IVA's closed and completed, I have no problem with IPs chasing any assets etc but not at the severe detriment of the debtor

Regards

[Skippy]

I completely agree Andy. It's not fair that people meet all their obligations and still can't move on. I know I would really begrudge having to hand over an inheritance or windfall after I'd finished my payments.

[David Mond]

Lots of comments seem to have been made since Size 5's last post but I’ll try to cover the main ones.

Andy – I agree fully that it would be a case of consumer detriment if cases were being held open for 2 years and we are both well aware that there are companies who are doing so. This isn’t relevant to this particular thread as this is not the case for any of ClearDebt clients.
In this instance the gripe of Geordie appears to be that the claims intermediary collected the documents 6 weeks ago and ClearDebt have not yet taken assignment of the claims. We cannot do this until potential claims are known, hence we need to await the outcome of the Subject Access Requests being sent to creditors. In this respect, the argument seems to be over a period of an additional 2 weeks rather than 2 years.

As Mel quite correctly states, it is the duty of the IP to investigate mis-sold PPI and some of the criticism and some of the conspiracy theories are grossly unfair.

The assignment process we have adopted and which we are applying to all of ClearDebt’s cases means that clients are not having to wait for the same period of time as was previously the case with us (and are still with the majority of other IVA providers) and the processes we have developed to speed issuing completion documents has been offered to all IPs to help with their closures and has been adopted by a number already.

Heretoday – the comment was not directed at you. It was a general comment relating to some of the problems faced by IPs and the difficulties in taking assignment at very early stages in the investigation. The point stands – IPs must ensure that assets are protected and where there are possible loopholes which could be exploited by the more unscrupulous clients these must be closed. Hence the need for establishing claims prior to taking assignment of them.

Skippy – your comment regarding “having to hand over an inheritance or windfall after I’d finished my payments” is not the case. I can’t speak for other IPs but it is certainly the case with ClearDebt that where a case is not completed solely due to an on-going mis-sold PPI investigation that the client will not have any liability for future windfalls, lottery wins, provide proof of expenditure etc. In this respect the only thing the debtor is not getting is their completion certificate but this will only be for a very short period of time whilst all potential claims are being established.

My final point, to the best of my knowledge, no other company has documented exactly what their procedure is or what steps they are taking to speed up the completion of cases. Instead a substantial number of experts have left the forum over the past 6 months from the vast majority of the larger firms -predominantly due to the ferocity and frequency of complaints regarding mis-sold PPI.

Accordingly, it seems at the moment that ClearDebt are there to be shot at as we have been the only major firm to document our processes publicly and to answer any and all questions regarding PPI mis-selling. ClearDebt (and other DRF members including Mel) have dedicated an extraordinary amount of time and resource in dealing with this matter for the benefit of the industry as a whole yet are being held accountable for the action/inaction of others.

I believe ClearDebt's policy of taking assignment of claims at the point they are known is the fairest and most responsible approach which causes minimal delays to the clients and gives the requisite level of protection to the asset(s) to fulfil the IP’s duty.

If anybody can tell me of any other IVA provider’s policies which deal with these issues better than ClearDebt's current process, then I will obviously be happy to listen and to adopt any ideas which will improve the process where applicable.

[Skippy]

Sorry David, my comment was general as I know of at least one company that is doing this - it wasn't directed at Cleardebt.

[Geordie]

Believe me I am not attempting to start WW3! I acknowledge that being with Clear Debt is a positive compared to other Companies we hear of and wait times of 2 years to close. I have though had a wait of approx 8 months post final payment to learn that some of my subject access requests were only posted out to creditors last week. I am certainly not qualified to question the duties of an IP, however I can see there are bottlenecks in the process that surely could be dealt with more efficiently.

My comments are not intended to bring into question a lack of professionalism or question motivation or lack of trust with any IP but to seek clarity and potentially a quicker resolution for me and others in this position.

Surely the objective is to have a procedure that works for all and delivers an excellent service to all parties and not just to be content with being better than the competition.

It has still not been explained why an assignment cannot be produced from the outset to allow the IVA to be closed, similar to the windfall clause in a typical IVA? This is the part I cannot understand coming from a point of view where I am more than happy to assist with potential PPI claims. Clear Debt have produced guidelines for PPI claims while in an IVA - My simple question is, can this be improved so its not at the detriment of the debtor? I am happy to be educated on any specific point

[MelanieGiles]

In my firm, we have amended the terms of our standard IVA proposals to specifically cover how PPI mis-selling claims will be dealt with, and this is discussed fully with our clients from the outset.

We continue to explore new thoughts and ideas, not only about PPI, but about a lot of things which are current and have caused historic difficulties.

I will continue to defend my profession, where defence is appropriate, and objectively deal with queries about these matters on the forum to the best of my ability - whether these postings are from my existing clients or not.

[Geordie]

Hi Mel -What ideas has your Company adopted to speed up the PPI process? Is there any particular way your firm deals with this, that could be adopted by others.

Is it possible to release an individual from an IVA while retaining the ability to process the PPI claim.

[MelanieGiles]

My firm have not really held up any closures past their contractual date due to PPI issues - although the mix of my portfolio in terms of "defined asset" rather than "all-asset" cases has perhaps made that task somewhat easier than firms who may always have adopted "all-asset" provisions.

The IVA Protocol was designed to simplify the IVA process, and assumed that the only assets which would be defined, and thus included, would be those referred to in the proposals - for instance equity in properties, sale of shares etc. So PPI mis-selling claims were not specifically highlighted - as is the case with many of my older cases. There is some argument that the failure to disclose the asset forms a default on the part of the debtor, but my legal advice indicates that this would be tricky to prove and that as an IP I had just as much responsibility to highlight this possibility to my clients - in reality, neither of us know that the PPI case would go against the banks and they would start paying out, so no one's fault.

About 18 months ago, when the PPI issue first reared its head, we amended the terms of our own proposals to include "all assets", as a lot of other firms have. Those firms who never adopted the Protocol, instead relying on R3 Standard Terms and Conditions, all have "all-asset provisions" automatically.

My firm's policy on PPI is very clear. We will investigate whether PPI exists on all cases, and submit mis-selling claims if our clients confirm to us that they believe mis-selling has taken place, or we believe that there are sufficient grounds to show mis-selling regardless of our client's views. Our clients are free to pursue those claims directly if they so wish on the understanding that all monies are payable into the IVA, but they have to regularly account to us for progress. Alternatively, they can instruct our claims management company to do this for them.

I do not believe that the use of an Assignment is necessary in my firm, as due to the aging of my portfolio we have some way to go yet before clients might be affected - by which time I hope to have all PPI claims squared away. Our general regulatory guidance is that cases can be closed, without assignments or any other causes for delay - however the option is there for IPs to make their own decisions, and many (including myself)have taken very expensive legal advice on this matter.

You cannot compare my firm with any other firm - all firms will have differing proposal terms, differing legal advice and differing interpretaions. Those people in our profession who know me well, know that I have very strong views on how PPI mis-selling claims ought to be dealt with - view which occasionally make me unpopular amongst my peer group, but I belive I am best representing the IP profession and our clients in sharing those views.

[Geordie]

Hi Mel - Thanks for your comprehensive comments and frank view of this issue. I suspect that I am flogging a dead horse In terms of me looking for any breakthrough with Clear Debt with respect to a potential quicker closure but thanks again for your comments.

I think it's particularly frustrating knowing I could become unemployed as a result of this and all the headaches that will bring, especially knowing nothing is set in stone and it potentially could have been dealt with differently

[MelanieGiles]

I sincerely hope that your employment will not be affected by this elay Geordie, and I know David Mond will share those concerns if he is looking in. Don't be afraid to contact David directly if you need to about this, but understand that his hands are tied by the slowness of response from creditors right now in all probability.

[David Mond]

Geordie – I don’t believe for a second that you are trying to start WW3 (or even WW4 after the issues with VAT following the Paymex ruling) and understand you are merely attempting to find a resolution for your specific case.

The reason for not taking assignment of claims prior to claims being known and submitted is simple – you cannot possibly assign a claim which doesn’t exist until the point it has been submitted.

I agree that there is the potential for a certain clause to be activated which in theory would capture these claims post completion and prohibit any action to prevent individuals from taking action to deceitfully prevent the Supervisor from recovering funds but in reality this is extremely difficult to put into practice.

As Supervisor, it is my obligation to act in the interest of all parties (including creditors) and there would be lots of creditors up in arms if I were to take an action in closing a case without having the protection in place to secure the potential asset(s).

My point previously was not to say “ClearDebt’s policies are better than all other firms so there is no need to improve them further” – it was that there have been no other IVA providers who have been able to come up with anything else better despite all IVA providers spending vast sums of money in obtaining the best possible legal advice possible.

I honestly do not believe there is anything further which can be done which will not be to the disadvantage of creditors and could land me or other IPs in hot water down the line.

Yes, your case has been kept open far longer than it would have been in an ideal world and yes there is a backlog of cases which needs to be dealt with.

The latter part of 2012 was spent getting the correct policies and infrastructure in place to be able to issue completion certificates more rapidly – these policies were just before Christmas and if your case was reviewed in February it is not unrealistic to think that your case will be able to close in the next 4 weeks.

Currently, all cases are being dealt with in real time – there are no delays in reviews being conducted (which you appear to have been subjected to whilst the new processes were being put into place and agreed by Counsel and creditors).

All proposals include a statement on how PPI mis-selling is to be handled and have done for nearly 12 months. Within the next 8 weeks, I fully expect that no ClearDebt client will have their completion delayed at all as a result of an investigation into PPI mis-selling.

[Geordie]

Again thanks for everyone's input.

[D A S]

Geordie
As I said earlier I know how you feel.
My final payment was around 9 months ago and I have only just signed the PPI paperwork this week.
WHY SUCH A DELAY.
I thought every thing had already started and anything that needed signing would be the end of the process not the start of it.

[MelanieGiles]

I think the explanations provided by both David Mond and myself on this thread probably say it all DAS?

[D A S]

I will state now for the record I AM MORE THAN HAPPY WITH HOW CLEAR DEBT HAVE RUN MY CASE.
It is just that the last 9 months have been wasted whilst very little seems to have happened.
WHY IS IT THAT THESE INVESTIGATIONS CANNOT HAPPEN AT THE START OF THE IVA.