Everlengthening IVA - Ombudsman Response

[iva.com]

Hi Chris,

Sorry to hear about your situation. Did you know that you can submit reviews on your experiences with IPs at IVA.Com. Information provided can be used by those looking to enter into an IVA and help them when choosing which IP to appoint.

Good luck with your compliant and please let us know how you get on.

Regards,

Terry
IVA.com - Regulating the IVA industry by using customer feedback.

Please rate your IVA company or Insolvency Practitioner by reviewing them here: http://www.iva.com/submit_iva_review.asp

[thebear29uk]

Hi Chris

Would it not be worth still sending your info to the IPA to get their opinion?

They state "We can only consider complaints about fees where there is a claim that the correct procedure has not been followed,and award or compel an ip to pay you compensation for any financail loss you consider you may have suffered."

Is the fact that you have paid substantially more in fees than originally stated on the Chairmans report and that you have paid back more than the original debt a case that the correct procedure has not been followed. If you end up paying £65K you will have paid the equivalent of 100p in the pound plus 8% statutory interest plus £8800 in IP fees.

Except £7k of the money that could have gone to the creditors is lining the pockets of your IP.

I'm sure Melanie will be along to advise you again at some point but I would agree that trying to arrange a meeting face-to-face might find some compromise. When creditors are trying to impose a fee of £4500 and most IP's are charging between £7k and £9k it would be beneficial to sit down opposite him and hear how he justifies fees at twice the accepted norm and 4 times the amounts creditors are trying to set.

Regards

Dave

[MelanieGiles]

Why not have a chat with someone at the IPA - I am sure that given the circumstances they will prepared to at least look at this for you. I gather that Wayne Harrison is the chap you may need to talk to in the first instance - or failing that Michelle Butler.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

For further details contact me at http://www.melaniegiles.com and view my IVA blog at: http://melaniegiles.blogs.iva.co.uk

[chris_]

Thanks for that reply Dave, but the IPA rules are not about correct procedure, but about correct approval procedure - according to the IPA that is making sure the basis for the fees are written down and approved properly at the outset of the IVA. - Thats it, that's all they cover!

I know where everyone is coming from by saying I should set up a meeting and I can see why, but having had all the conversations and letters that I have had with my IP over this he knows exactly where I am coming from. I have asked them directly to justify their fees and have laid out the question more or less exactly as you have in your post.
The reply I have had (on several occasions) has continually been 'our fees are based on the time spent on your case and are as laid out in the terms and conditions etc etc...' They just will not talk or write to justify anything.

In my last letter to them pointing out my case for the ombudsman (which they were already aware of) the answer I got was short and to the point 'I accept your comments but notwithstanding that you still need to pay 5k immediately as you are still in breach of... etc etc ' that was it.


They have had umpteen opportunites to make a case for their fees and they have failed to make any attempt - and if they are safe in the knowledge that neither the IPA nor the ombudsman can do anything, then why would they be bothered.

This comes back to my point about what I can actually do now.

(1)Yes, I could try yet again to come to a compromise with my IP, even face to face in a meeting - but I don't hold out much hope after all the dealings we have already had.

(2) Ombudsman - OUT

(3) IPA - Out

(4) Court action - does anyone know where in the insolvency act there is the provision for the courts to reduce excessive fees ? - that is what the IPA clearly points out in their complaints procedure.

Thanks for all the comments and help, they really count and although I might not be getting anywhere, at least it isn't through lack of trying.

Chris.

[chris_]

Thanks Melanie,
Our posts crossed!

I will try that in the morning if you think that it might do some good !(it certainly can't do any harm).

Chris.

[mick.i]

Chris,

The 5th option to you, is to try your hardest to raise the 5k, pay them off and then start the rest of your life with your wife, new child and never have to be in this position again.

[chris_]

Melanie,
Having read through the insolvency rules 1986 today one thing did stand out to me.

In it the rules state that the rates that the IP charges for his staff etc has to be laid out at the beginning of the IVA (Mine wasn't initially and the court rejected it and the IP had to resubmit everything with the hourly rates attached to get the IVA approved by the court) - The initial rates were just put down as 'between £45 and £90hr depending on who does the work' that was it. A few days later the IP began charging fees at £110 hr - at no point was I ever charged a maximum of £90hr.

In the insolvency rules it states that if the rates the IP charges changes then the creditors must be notified of the increased rates. - I have never been notified of these and I suspect therefore that neither has any of my creditors. (Remember the IP's rates went up to £180/hr in just 3 years)

Melanie, how do you interpret this rule and is it legally binding ? - is this some ammo I can use ?

Chris.

[MelanieGiles]

Chris

You already know that I feel that you have a case which warrants a third party opinion from someone who is impartial, and who is prepared to listed to both sides and give guidance from a regulatory position.

The rules are written there for practitioners like me to observe. If your IP did not make you or the creditors aware of increases in his chargeout rates, then this gives you grounds for a complaint, but I cannot say what the outcome will be.

In order to be taken seriously, you do have to demonstrate the issues you have concerns over, and show that you have taken all reasonable steps to arrive at a sensible settlement or compromise. At face value you appear to have a good case, but your IP will undoubtedly have his own version of the events and explanations for these high time costs and he deserves to be heard as well.

My advice is still to arrange to meet with your IP face to face, view the files and listen to their explanation of the facts - I have not lost sight of the fact that the increased costs are still being blamed on agreeing a HMRC claim, but that the actual time costs allocated to this category are pretty light.

If you are then still unhappy about the way your case has been dealt with, particularly as you are paying the bill, then take it further.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

For further details contact me at http://www.melaniegiles.com and view my IVA blog at: http://melaniegiles.blogs.iva.co.uk

[freelili]

Chris

I am so sorry and gutted for you, I really believed that this would be sorted out quickly by the ombudsman. I wonder if its worth getting a half hour free consultation with a financial solicitor. It seems they can hold you to ransom and are guilty of extortion. Wheel clampers suddenly spring to mind for some reason. This is not just a financial issue though, the stress you must be under is immense and not what your partner, child and future child deserve now, is there anyway a solicitor could consider the human costs in all this??? This IP has you over a barrel and is twisting the knife, I cannot believe that its all legal. I am sure Melanie must be as upset about this as you are, I really hope that you can get shot of this company ASAP abd bring them to book. I am sure that everyone on this forum is rooting for you.

Good luck Chris I wish you the very best.

LILY

fly me up to where you are beyong the distant star, I will wish upon tonight, to see you smile, only for a while, to know youre there, a breath away is not too far, to where you are.

[chris_]

Thanks everyone.

I seem to be on this roundabout and not able to find an exit off it - as Melanie says I need a third party to examine this case and I thought we had one in the ombudsman. I will try the IPA today but I don't hold out much hope.

Just to pick on one point Melanie, the IP blamed HMRC for the increased costs in the first couple of years only - not the last four years. - 2006 fees were about 4K on their own!!

It is those later increases that have me the most concerned as there is no possible explanation, and none has been given by the IP.
There are no specific reasons for the massive later fees, they have just added more entries at higher rates for the same administration.

I have never wanted to get into an argument over the HMRC costs although as you quite rightly point out there is very little in the time/costs that apply to this 'extra' work.

Again as Melanie points out in earlier posts - it is not the multitude of little points that are important on their own, it is the overall picture of time/costs abuse that should be focused on.
I am beginning to realise though that no-one (other than everyone on these forums) actually cares one jot.

If I had to go to court (and I am prepared to do so) I need to have all the little facts stacked up (don't I?) I would need to show all these 'minor' points so please forgive me if I keep asking about small issues.

The problem as posted earlier is that who do I turn to after the IPA - is there anyone out there with experience of insolvency law and court cases with regards fee reduction ? AND most importantly where in the insolvency act is the relevant piece of law.

Does anybody know ?

Chris.

[DebtDummy]

chris, very sorry to hear of your problem. It's been a long fight.
There is another option you can try, but it would mean national exposure. Contact The Times or The Telegraph or any of the others and tell them you have a story that may be of interests. It is timely(IPs fees being too high) and may be picked up. You have all the evidence, etc, of what transpired. Worth a try, but again it means your story and possibly your photo appearing in the newspaper.

Thank you for the information regarding the April 6 2007 Ombudsman complaint procedure in handling IPs. That information will be useful for someone else.

I wish you success.

All I have left is my humour.

View my blog http://www.debtdummybankruwoman.blogs.iva.co.uk.

[Skippy]

The other option I thought of was Watchdog - I know they have covered dody financial companies in the past.

Yesterday is history, tomorrow is a mystery, today is the present - a gift to make the most of.

View my blog at http://skippy13.blogs.iva.co.uk/

[aguise]

I was thinking on the same lines chris, as dd and skippy.

Ang

[chris_]

Thanks,

It is something worth considering if the IPA doesn't do anything.

I don't fancy the exposure though!! -

I would probably go down the court route next if only I could get someone to tell me where in the insolvency laws it tells you about courts having the power over fees.

Chris.

[ivoriva]

Hi Chris,

Its a long shot but try a post on www.consumeractiongroup.com/forum - they are mainly concerned with bank charges at the moment but they do have a general debt forum and I know some solictors read & post there regarding other debt matters as well.