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Credit Card Borrower Tortured By Lender, Says Judge

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http://www.bbc.co.uk/news/business-12622318

The MBNA bank has been accused by a High Court judge of "torturing" a customer with repeated phone calls demanding he repay his credit card.

Mr Keith Harrison had his debt of £20,270 written off by Judge Nicholas Chambers QC at Mold in North Wales.

He said MBNA had failed to give Mr Harrison the terms and conditions for the card, when he took it out.

MBNA said it was reviewing the comments and said it had been unable to have "meaningful dialogue" with Mr Harrison.

"[We] were unable to ascertain the reason for non-payment," the bank added.

The judge denounced the tactics that MBNA and its debt collection firm had used to force him to pay up.

"In my view, the claimant rightly complains that, mainly by MBNA but also by the defendant [debt collectors Link Financial], he was hounded by telephone calls seeking payment of what was said to be due," said Mr Justice Chambers.

Improper conduct

The judge was scathing about the non-traceable phone calls which both MBNA and Link Financial - who bought the debt in 2008 - had used to try to recover the debt.

"It seems to me that such conduct has no proper function in the recovery of consumer debt," Mr Justice Chambers said.

"[There] can be no excuse for conduct of which it must be supposed the sole purpose must have been to make the claimant's life so difficult that he would come to heel.

"I cannot think that in a society that is otherwise so sensitive of a consumer's position this is conduct that should be countenanced," he added.

Link Financial blamed Mr Harrison for being uncooperative and said its own approach had been "both proportionate and a reasonable".

A spokesman said: "We attempted to contact Mr Harrison 18 times over a period of 12 months, as Mr Harrison acknowledges himself through his own records."

"Although all those calls were unanswered, answerphone messages were left with a polite invitation to call us together with a contact telephone number.

"Mr Harrison declined to do so," the spokesman said.

Surely there has to be more to it than this? It sounds bizarre, non traceable phone calls and yet details of who to contact was left on the answer machine? Seems very puzzling it just doesn't add up.

Although it would appear that if people chase the money owed you can now claim harassment and don't have to pay.

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Surely there has to be more to it than this? It sounds bizarre, non traceable phone calls and yet details of who to contact was left on the answer machine? Seems very puzzling it just doesn't add up.

it would seem puzzling at first but allow me to clarify, any more than one or two calls a week from anyone can be construed as harassment, this applies to anyone calling about anything not just debt that you may or may not owe, as unsecured debt providers have an address and one or two contact numbers most of them will send letters (contents of letters can be misleading and sometimes border on attempted fraud/harassment) and bombard any numbers they have with calls sometimes using auto dialer bots from untraceable numbers etc

hence the ruling simply clarifies already extant law on the subject. (laws preventing harassment)

Although it would appear that if people chase the money owed you can now claim harassment and don't have to pay.

the claim of harassment only applies if the companies seeking payment breach the law as defined above, as many of them do this as part of there standard operating procedure they are the ones committing criminal harassment as business practice so who deserves the moral outrage/ is the real bad guy ?

and as the system stands you do not have to pay and you never did as far as i know, unsecured debt is unsecured on anything other than the persons credit rating which will be savaged for non payment(the punishment for non payment) , then after 6 years of having no contact with creditors you can apply to have the debt wiped and start repairing your credit rating or circumvent that and go bankrupt at any point up to the 6 years of non contact

this is the system as it stands i do not have an opinion on the morality of it one way or the other i am just stating the "facts on the ground" of the situation.

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I think the main point here is that they had failed to comply with the Consumer Credit Act and had not supplied him with the necessary T&C's when the agreement was taken out.

Fair enough really the law is the law. A firm like MBNA should know their statutory obligations. :lol:

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I think the main point here is that they had failed to comply with the Consumer Credit Act and had not supplied him with the necessary T&C's when the agreement was taken out.

Fair enough really the law is the law. A firm like MBNA should know their statutory obligations. :lol:

yes a fair point, however using criminal harassment in an attempt to recover debt for which there is civil recourse available and penalties that can be rendered i.e. county court judgments etc, and as they can be sought/imposed without resort to harassment these actions (criminal harassment) are worthy of having the debt wiped anyway in my humble opinion and now clarified by legal precedent (the judges ruling on this case) when viewed as a whole.

anyone reading this thread who has debt problems please contact the citizens advice bureau and or national debtline or the consumer credit association for impartial advice and help about these issues, a visit to your GP is advisable as well if your are suffering with stress/disturbed sleep etc as it is always best to get a handle on these things as early as possible and talk to people about it.

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Maybe a big assumption here but that 20k is probably more than a yrs wage for this guy. With the exception of a mortgage any person with a debt so large might do well to consider walking away from it.

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Guest eight

yes a fair point, however using criminal harassment in an attempt to recover debt for which there is civil recourse available and penalties that can be rendered i.e. county court judgments etc, and as they can be sought/imposed without resort to harassment these actions (criminal harassment) are worthy of having the debt wiped anyway in my humble opinion and now clarified by legal precedent (the judges ruling on this case) when viewed as a whole.

That's the last thing the lenders want though. The guy might reasonably get a judgement that he has to repay at £5/month and then it would be set in stone. Better in their eyes to harass him to the point of submission.

Basically if gets to the debt collector stage everything's fubared anyway so they are just trying to grab what they can in mitigation of losses.... if there actually are any. Chances are that if he's had the card for some time he has already made a reasonable return on the original loaned capital. Plus all the fees etc.

eight

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My guess is that there are actually two parts to this case.

After hearing evidence that MBNA had not complied with the Consumer Credit Act by serving terms and conditions, the Judge gave judgement for the defendant, and that is the actual legal position.

The Judge then went on, as some like to do, to make observations about the case.

He criticised MBNA for their harrassment. This is not part of the judgement. The harrassment did not lead to the debt being quashed.

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That's the last thing the lenders want though. The guy might reasonably get a judgement that he has to repay at £5/month and then it would be set in stone. Better in their eyes to harass him to the point of submission.

Basically if gets to the debt collector stage everything's fubared anyway so they are just trying to grab what they can in mitigation of losses.... if there actually are any. Chances are that if he's had the card for some time he has already made a reasonable return on the original loaned capital. Plus all the fees etc.

eight

indeed, i am well aware of the points you are making i was just pointing out the arguments that were drawn out to justify the ruling.

B)

The harrassment did not lead to the debt being quashed.

possibly, however the procedural error could of just of easily been justification for the ruling in lieu of the criminal harassment for which there are penalties anyway.

Edited by uncle rogi

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Since MBNA is an American bank and Mr Harrison is Welsh, £20K has now been transfered from the USA to the UK - nice! :)

wrong...the bonus that was paid for, and profits booked, have all been taken in the USA, at inception

the 20K unpaid is now unrecoverable and therefore not an Asset to the UK, or the US for that matter.

This is just one tiny pin ***** in the huge default list that we need to burst this bubble.

You see, there never was any profit in this deal...just profits yet to materialise...and they have all been booked by the bankers as assets...I wonder how many years before this one is even written out of the CDO it is included in.

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Sticks and stones will break my bones

But words will never hurt me.

TWATS. What an insult to anyone who's ever been tortured[1].

[1] with pain rather than being nagged to pay back money.

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The consumer credit act puts certain legal obligations on the lender that they need to comply with. In this case it was the failure by MBNA to send terms and conditions to the consumer. When the obligations are not complied with the agreement falls out of a 'regulated agreement' and therefore only becomes enforceable by the lender in the Courts.

From reading the report it seems to me that MBNA/Link Financial then went to Court to have the agreement enforced, however on hearing evidence from the consumer and agreeing that their actions amounted to harassment the Judge would not allow the agreement to become enforceable, therefore the debt has no basis in law, hence there would be no recourse to recover the money by MBNA/Link Financial.

Edit to add

In summary, the Court decided not the use it's discretion to have the debt fall under a regulated agreement because of the actions of the lender.

Edited by Mr. Miyagi

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Guest eight

wrong...the bonus that was paid for, and profits booked, have all been taken in the USA, at inception

the 20K unpaid is now unrecoverable and therefore not an Asset to the UK, or the US for that matter.

This is just one tiny pin ***** in the huge default list that we need to burst this bubble.

You see, there never was any profit in this deal...just profits yet to materialise...and they have all been booked by the bankers as assets...I wonder how many years before this one is even written out of the CDO it is included in.

Jesus. What a depressingly sober and accurate view of the situation.

eight

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A fairly schizophrenic, muddled piece by the BBC. Their implication is that the debt was written off because of the 'harassment' by MBNA and the collection agency who bought the debt. Perhaps the debtor should have grown some nuts, answered the first call and acutally spoke to the company he borrowed money from (and no doubt enjoyed spending)

The debt was written off because of a failure by MBNA to comply with CCA laws, the 'harassment' is simply what happened during the debtors refusal to speak to the creditor.

I am fairly confident that at some stage that this guy was contacted, or saw an advert from a debt write off company and saw this as the way out, instead of, imo, doing the morally correct thing of paying back his debt, or at least offering them some kind of repayment, token or otherwise.

Next time you need to borrow money, you will absorb these kind of write offs in higher borrowing costs.

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A fairly schizophrenic, muddled piece by the BBC. Their implication is that the debt was written off because of the 'harassment' by MBNA and the collection agency who bought the debt. Perhaps the debtor should have grown some nuts, answered the first call and acutally spoke to the company he borrowed money from (and no doubt enjoyed spending)

The debt was written off because of a failure by MBNA to comply with CCA laws, the 'harassment' is simply what happened during the debtors refusal to speak to the creditor.

I am fairly confident that at some stage that this guy was contacted, or saw an advert from a debt write off company and saw this as the way out, instead of, imo, doing the morally correct thing of paying back his debt, or at least offering them some kind of repayment, token or otherwise.

Next time you need to borrow money, you will absorb these kind of write offs in higher borrowing costs.

Credit cards involve lending and borrowing now?

Whne did that happen?

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My guess is that there are actually two parts to this case.

After hearing evidence that MBNA had not complied with the Consumer Credit Act by serving terms and conditions, the Judge gave judgement for the defendant, and that is the actual legal position.

The Judge then went on, as some like to do, to make observations about the case.

He criticised MBNA for their harrassment. This is not part of the judgement. The harrassment did not lead to the debt being quashed.

It would be interesting to know what information the judge based his main decision on, where he said that MBNA didnt provide terms and conditions to the borrower. FWIW, I bet that they were sent. The borrower may well have said in court that he didnt get them, and MBNA said that they sent them, and the judge decided to believe the borrower.

I reckon he received them, it is bound to be standard practice to send them out. Judges have huge discretion to distort facts to make the law work anyway they want to. There is another thread today where someone tried to get out of paying a cc debt, and that judge went the opposite way and wouldnt relieve the borrower of the burden.

This is all very dangerous for the credit industry. If you dont have courts that are consistent, then how can you forward credit to anyone. Any credit agreement needs some way of applying pain to a delinquent borrower. If you write it off because a judge bends all credibility to believe that the credit agreement wasnt received, then how can anyone forward credit to anyone else? It would leave the CC industry pretty much dead in the water.

And as for harrassment, was it really just 18 calls over 12 months? That is about 1 every 3 weeks, which seems pretty reasonable given the amount of money involved, and given that the guy never answered his phone. If he had, and explained his position to the debt collection agency, and there were lots of follow up calls without the situation changing, that might be harrassment, but attempts to contact him and speak to him, seem reasonable to me.

I think that what this case tells us, is that the judge doesnt know what he is doing. Either that or he is a mate of the debtor.

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It would be interesting to know what information the judge based his main decision on, where he said that MBNA didnt provide terms and conditions to the borrower. FWIW, I bet that they were sent. The borrower may well have said in court that he didnt get them, and MBNA said that they sent them, and the judge decided to believe the borrower.

There are rules about when a letter is deemed to have been delivered...

MBNA are silly if they don't challenge that aspect of it.

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There are rules about when a letter is deemed to have been delivered...

MBNA are silly if they don't challenge that aspect of it.

I cant believe that they didnt. However, that is of little use when you have a judge bending over backwards to help out the debtor.

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I cant believe that they didnt. However, that is of little use when you have a judge bending over backwards to help out the debtor.

It's because the calls were untracable.

The judge was scathing about the non-traceable phone calls which both MBNA and Link Financial - who bought the debt in 2008 - had used to try to recover the debt.

"It seems to me that such conduct has no proper function in the recovery of consumer debt," Mr Justice Chambers said.

I can see the principle, and I am sure you can as well. if they are allowed to phone from untracable lines they could conceivably spam him every few minutes without leaving a message but demanding payment if he answers. he's told them to stick it so they don't go down that road.

Also, the 18 times quote is from ONE of the people chasing the debt, and almost certainly they are only admitting that due to their being records of it. Obviously untracable calls won't have records!

What else....

Mr Harrison took out the card in 1998

Much more likely he never got the T%C's because that was back before moneysavingexpert and co were around.

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Guest eight

What else....

Mr Harrison took out the card in 1998

Much more likely he never got the T%C's because that was back before moneysavingexpert and co were around.

I missed that bit completely.

He'll have repaid the principal many times over, I reckon.

eight

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It's because the calls were untracable.

I can see the principle, and I am sure you can as well. if they are allowed to phone from untracable lines they could conceivably spam him every few minutes without leaving a message but demanding payment if he answers. he's told them to stick it so they don't go down that road.

Also, the 18 times quote is from ONE of the people chasing the debt, and almost certainly they are only admitting that due to their being records of it. Obviously untracable calls won't have records!

What else....

Mr Harrison took out the card in 1998

Much more likely he never got the T%C's because that was back before moneysavingexpert and co were around.

I expect another reason why numbers were witheld would be that the debtor would have simply refused to answer a call if he could see who was making it.

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Guest eight

I expect another reason why numbers were witheld would be that the debtor would have simply refused to answer a call if he could see who was making it.

As is his right.

They don't own your life you know.

eight

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It's because the calls were untracable.

I can see the principle, and I am sure you can as well. if they are allowed to phone from untracable lines they could conceivably spam him every few minutes without leaving a message but demanding payment if he answers. he's told them to stick it so they don't go down that road.

Also, the 18 times quote is from ONE of the people chasing the debt, and almost certainly they are only admitting that due to their being records of it. Obviously untracable calls won't have records!

What else....

Mr Harrison took out the card in 1998

Much more likely he never got the T%C's because that was back before moneysavingexpert and co were around.

I have to agree with you on the untraceable calls. They should leave a mark as to who called via the phone number. However, I guess that means any call from an untraceable call is now harrassment. I wonder how that will pan out?

As for the 18 calls coming from only one debt collector, there is no evidence here that he had multiple agencies trying to collect from him. Normally a debt is sold on to only one debt collectors is it not? Could get quite expensive to chase debts otherwise.

As for taking out the card in 1998, what has that got to do with it? I bet he still got the terms, they did have them then you know.

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I expect another reason why numbers were witheld would be that the debtor would have simply refused to answer a call if he could see who was making it.

In which he case the CC company could prove he was in dishnour, instead of the other way around.

I can hardly claim you don't want to talk to me if I stick a disguise on first so that you don't know who I am!

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I missed that bit completely.

He'll have repaid the principal many times over, I reckon.

eight

Yes, but you have to pay the interest that you agree to pay too. Except this time he didnt have to pay 20 grand of it.

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