Another letter from Paragon.

Paragon are very persistent, I'll give them that much. For those that are unfamiliar with events so far, Paragon are collecting a Universal Credit debt which had a balance of £4200 some 10 years ago. I have paid back over £15,000 and they claim I still owe somewhere in the region of £12k. I say somewhere in the region because they are not very good at telling you how much you owe, if you ask they say they can't tell you. To date they haven't managed to provide a true copy of the consumer credit agreement, only a made up copy. As such the debt isn't legally enforceable, but that doesn't stop them chasing it by constant phone calls and letters.

22nd June 2009

Dear XXXXXX

I have been attempting to contact you to discuss your account (really? You have spoken to me on the phone on a daily basis).

Upon receipt of this letter would you please telephone this office on the above direct line telephone number, quoting your account number.

In accordance with the company fee tariff, a charge of £10 has been added to your account for this letter. A charge of £10 will be added for every additional letter issues if contact is not made and a charge of £20 will be added if we contact you by telephone.

I look forward to hearing from you

Nadine Smith

collections officer.

The thing is, I don't know what they want to discuss, I have told them this is in dispute and will remain so until they produce a true copy of the CCA. Every time I speak to them on the phone we go over the same thing - They ask for payment, I ask for a CCA, they say they sent one, I say it's a made up copy which isn't worth the paper it's written on, they say they don't have the original, I say take me to court then, they say they won't do that. End of call.

Please tell me about your Paragon/Universal Credit debt

There are many, many stories on the internet about Paragon adding massive amounts of interest to Universal Credit debts. BBC Watchdog also featured a handful of cases a few years back.

Please let me know about your experiences with Paragon, especially if they agreed to freeze your interest and then secretly added it back.

Over the next few weeks I'll be writing to the money pages of national newspapers with the shocking way Paragon have treated my account.

Paragon slip up

This might be of interest to some of you with old Universal Credit agreements. On the 15th February 2000, A standard automated letter was sent to all UC/Paragon customers behind with payments. The letter offered to consolidate arrears and report the account as up to date with Credit agencies in return for a standing order mandate and two post dated cheques.

I have heard of two cases where this document has been produced in court and resulted in Paragon settling for reduced figures. I have the case notes from one of the cases which took place in Northampton County Court. The argument is that the letter was a variation to the Consumer Credit Agreement and if it was "consideration" (http://en.wikipedia.org/wiki/Consideration_under_English_law).

In this case Paragon had won judgement but then appealed for interest on top. Paragon dropped the appeal after this document was introduced and agreed to settle for the original amount.

"Paragon originally claimed over £18,107 but the district judge gave them judgment for £5,457 because that was what they had told us throughout was the balance, only asking for £18,107 when they issued proceedings. They (paragon) immediately asked for permission to appeal. The District Judge refused; they asked again at the appeal court.

After permission to appeal was given by the Court of Appeal they put forward a somewhat insulting offer to accept £18,107 in settlement and write off the interest and costs incurred in the meantime.

About one month before the scheduled Court of Appeal hearing date, they improved the offer to £5,457".

In the above case the argument against Paragon was the letter sent in February 2000 was consideration. As Paragon settled for the reduced figure the case for consideration wasn't tried, but it's interesting that Paragon backed down after the document was produced.

In the second case it was argued that the letter dated 15th February 2000 was a variation of the Consumer Credit Agreement and didn't comply with technical aspects of the 1974 Consumer Credit Act. Once again Paragon backed down.

Paragon threaten home visit

Today I received a telemessage from Paragon saying as they had tried to contact me without success (I guess talking to me every day on the phone for two weeks wasn't good enough), they would be sending a representative to my home to discuss my account. They would charge £89 for this.

Paragon seem to have a problem understanding a few basic facts, like the debt is unenforceable, not to mention they had spoken to me at least 14 times in the past couple of weeks.

Reply from OFT in regards to my complaint against Paragon.

I had a reply back from the Office of Fair trading regrding my recent complaint about Paragon.

Complaint Against: Paragon Finance plc

Licence No: 189829

Thank you for your email. I apologise for the delay in responding to you.

I am very sorry to hear about the difficulties you have been experiencing, however, the Office of Fair Trading (OFT) has no authority to become involved in disputes between consumers and traders, so we cannot offer you any direct help with the complaint or advise you directly in this matter. Our role is to protect the collective interests of consumers.

The above mentioned Act established a licensing system to protect the interests of consumers in the credit area. If a business wishes to undertake the collection of debts that arise from consumer credit agreements then the Act states that they are required to hold a consumer credit licence; this is issued by the OFT. The above trader holds a consumer credit licence. Under the Act, the OFT has a duty to consider the fitness of all traders who hold consumer credit licences.

In considering fitness we take into account whether a business has engaged in improper business practices. Where we receive complaints about the business practices of licensees, we investigate them and where appropriate we take enforcement action; that action depends on the evidence and circumstances. Action the OFT can take includes revoking, refusing or suspending a licence; or placing conduct requirements on the licence of the company or business in question (failure to comply with a conduct requirement can result in a financial penalty being levied).

The OFT has issued guidance to consumer credit licence holders engaged in the debt collection industry. The guidance is intended to ensure that debt collectors treat debtors fairly. Non-compliance with this guidance will call into question the fitness of licence holders and applicants. You can view our guidance at: The Office of Fair Trading: Debt collection practices

I have noted the details of your complaint, and we will consider this alongside any other complaints we have received with a view to any licensing action we may decide to take. If we do take any licensing action against this trader, it is likely that we would need to disclose your identity to this trader along with details of your complaint. I should therefore be grateful if you could sign the attached consent form and return it to me. Unfortunately, we cannot disclose any details about any action we may take, due to restrictions on the OFT relating to disclosure of information (Part 9 of the Enterprise Act 2002).

Providing copies of agreements regulated by the Act

As you may know, s63 of the Act covers how and when lenders must provide consumers with a first (and where appropriate second) copy of a regulated agreement. It is clearly in the lender’s best interests to retain details of the original agreement and any subsequent variations or changes made to it, particularly as consumers can request a subsequent ‘true’ copy of most types of agreement under ss77 and 78 of the CCA (and on payment of the appropriate fee). There are rules about what is likely to constitute a ‘true copy’ under these sections of the Act. Further, if a consumer does make a valid request for a copy of their agreements under these provisions and the lender does not comply with the request, the agreement may not be enforceable in the Courts, subject to any other mitigating factors.

Should you require specialist advice or assistance on the circumstances of your complaint (including in relation to the above provisions about copy requirements), you may wish to contact your local Citizens’ Advice Bureau (CAB) or seek advice direct from a legal advisor.

The Financial Ombudsman Service (FOS) can help with most complaints about consumer-credit products and services if the consumer has failed to satisfactorily resolve the matter directly with the financial institution itself.

FOS can be contacted at: The Financial Ombudsman Service, South Quay Plaza, 183 Marsh Wall, London, E14 9SR; telephone number, 0845 080 1800, or Financial Ombudsman Service

We would like to thank you once again for writing to us and bringing this matter to our attention.

Yours sincerely
Samit Patel

Enquiries and Reporting Centre (ERC)

Office of Fair Trading (OFT)

Paragon - No CCA

From my various phone calls with Paragon it has become apparent they don't have the original Consumer Credit Agreement from Universal Credit, instead the version they sent me last year is a made up copy of the terms and conditions. This is of course totally unenforceable.

I also came across some interesting reading on the internet -

http://tinyurl.com/lf8x3t

This seems to suggest Paragon are fully aware that many Universal Credit CCA's are non enforceable.

Complaint made against Paragon.

I was advised to make a complaint about Paragon's constant phone calls under some fairly new regulations which protect consumers from unfair trading. It's worth a try. I sent this to the Office of Fair Trading.

4th June 2009

Dear Sir/Madam

Consumer Protection from unfair trading regulations 2008 (CPUT)

Formal complaint against Paragon Finance for harassment

I write to complain under the above regulations. I am receiving persistent phone calls from Paragon in respect of a purported debt for which an original Consumer Credit Agreement does not exist.

I have asked Paragon to stop telephoning me and to communicate by letter as the calls are interfering me with my family life. Despite this the calls continue. I have logged the calls over the past few days along with a summary of content, I have listed these at the end of the page.

Although I agree the DCA are entitled to take reasonable care to pursue a debt if they feel there are outstanding issues, I consider the level of calls to be above what I can reasonably expect. The debt is in dispute as no Consumer Credit Agreement exists and Paragon have been made aware of this.

I notice that Paragon are prepared to carry out a campaign of constant harassment rather than bring legal action against me, which in my view is the proper and reasonable course of action. I have raised these issues with Paragon who admit they do not have the original consumer credit agreement and have no intention of stopping the phone calls or taking any legal action.

I consider Paragon are operating an unfair commercial practice and this is the reason I am bringing the complaint to you. At Present Paragon are calling me on a daily basis and I think this is totally unreasonable in the circumstances .

Yours Faithfully

Recent calls from Paragon -

4th June 2009. Paragon “I see we have called you a lot recently”.

3rd June 2009, 9.46am. Paragon said they would continue to call on a daily basis despite my protests.

2nd June 2009, 10.38am (busy so didn’t answer), 10.40am (they called back 2 minutes later).

1st June 2009, 9.43am. Paragon asking for payment, admit they don’t have the CCA , say they will continue to call despite my asking not to, claim they are within the FSA guidelines to call as often as they want.

28th May 2009, 12.02pm. Paragon asking for payment, I asked not be called, they say they will continue to call. I ask why they have called me twice in one day, they say they need payment. I say debt in is dispute and ask they take me to court, they refuse .

28th May 2009, 8.25am. Paragon leave message on answer phone. I call them back, they ask for payment. I tell them account is in dispute. I ask them to write to me instead of calling.

27th May 2009, 10.50am. Paragon call and ask if I would like to make a full and final offer or make a payment. I ask for original CCA, which they say they don’t have.

Constant phone calls from Paragon

Paragon have been calling me every day (sometimes twice) pestering me to pay the debt they claim I owe.

Recent calls from Paragon -

4th June 2009. Paragon “I see we have called you a lot recently”.

3rd June 2009, 9.46am. Paragon said they would continue to call on a daily basis despite my protests.

2nd June 2009, 10.38am (busy so didn’t answer), 10.40am (they called back 2 minutes later).

1st June 2009, 9.43am. Paragon asking for payment, admit they don’t have the CCA , say they will continue to call despite my asking not to, claim they are within the FSA guidelines to call as often as they want.

28th May 2009, 12.02pm. Paragon asking for payment, I asked not be called, they say they will continue to call. I ask why they have called me twice in one day, they say they need payment. I say debt in is dispute and ask they take me to court, they refuse .

28th May 2009, 8.25am. Paragon leave message on answer phone. I call them back, they ask for payment. I tell them account is in dispute. I ask them to write to me instead of calling.

27th May 2009, 10.50am. Paragon call and ask if I would like to make a full and final offer or make a payment. I ask for original CCA, which they say they don’t have.