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.

Out of the blue letter from Paragon.

The story so far (to save you scrolling through previous posts). I took out a Universal Credit loan back in 1995. I paid for four years and then ran into problems. I contacted CAB who arranged for reduced payments until I could afford to pay the full monthly amount again. Part of the agreement was for interest to be frozen to prevent the debt getting any bigger, this is a standard practice (I had another debt with Barclays who did freeze the interest and it was paid off in full years ago).

Paragon brought UC and agreed to the monthly payments, they forgot to mention they would add interest back to the point when CAB made the agreement. Over the years I increased my payments and actually paid back around £15,000 on a debt of £4200. Paragon being greedy wanted another £12000 in compound interest!

Last year I stopped paying. I felt I had no moral obligation to pay back even more money as I had already paid back the debt with considerable interest. Paragon phoned a few times after I stopped paying, but then I heard nothing for several months.

I received a letter from Paragon saying -

I refer to previous communication in connection with the above account.

Following a review of the account, i confirm the company is not willing prepared to write off the balance and whilst the account is outstanding it will affect your credit rating.

I can confirm the company are prepared to negotiate on the balance by the way of a full and final or capped term offer that you might decide to put forward.

If you choose to make an offer please put it in writing.

More comments about Paragon

This is from a thread on the Consumer Forums (http://www.consumeractiongroup.co.uk/forum/general-debt-issues/148293-paragon-finance-enough-enough.html)

" In Dec 1997 my ex-wife and I took out a loan with Paragon for appx £7,500,
the APR was 28.9% payable over 10 years. A year later we seperated. I changed
profession at this time and advised Paragon that the account would fall into
arrears and that my ex-wife would assist with the monthly payments of £162.34 by
paying half. This happened for a few months and then She stopped paying and the
account ran into arrears (I continued to pay £81.32). I anticipated the
situation occuring and told Paragon that I would bring the account up to balance
as soon as I could. Remembering back it seems they did nothing, and 6 or so
months later payed up the arrears and I was back to paying the £162.34 a month
(incidently the loan is a joint and several liability loan and I have been
paying this amount on my own since the
seperation). This has since continued
uninterupted.Two years ago I looked into
paying off the final amount
expecting to only have a few hundred pounds left to
pay I was a MORTIFIED to
find I had a resettlement figure of £9,500 left to pay.
On contacting
Paragon they informed me that the interest would be frozen, I had
asked them
to do this as a mark of good faith (the word sucker springs to
mind!!!). It
seems that I now have £9,700 to pay. I`m not a maths genius but it
looks to
me that I'm increasing the debt by a few pounds each month, so this
loan
will never be paid off "

And it's not the only post about Paragon.

"we took out a loan with paragon 10 yes ago for £15000 unfortunately we found
ourselves is financial difficulty and had to turn to a debt mamagement co called
payplan..(which i have to say have been fantastic in my experiance).......we
were paying off the debt with paragon on a reduced and agreed rate for about 6
yrs..............last yr we got together the money to settle all our
creditors.............and when we asked paragon for a settlement
figure.........we were shocked to find that by our calculations it was about
£3500 and they are saying it is £13500 i obviously queried this and was told
that it was interest on the account as we had not stood by the
agreement"

And even more....

"In 1997 I took out a personal loan with Universal Credit for £10,000. I maintained the payments without any problems for a couple of years, but then got into financial difficulties as a result of my business collapsing and the breakdown of my marriage.In this period, the debt was purchased by Paragon Finance, who I was led to believe bought the entire loan book of Universal Credit.I agreed with Paragon to make reduced payments at a level that I could afford after a meeting with an external representative that Paragon out-sourced, who I visited at their house. He agreed that, due to my financial circumstances, interest would be frozen. This surprised me as I believed that my original agreement had been a fixed personal loan and not a monthly charge account.Last November, having first found this site, I sent a Data Protection Act letter to Paragon asking for a breakdown of my account. I was disturbed to find that interest had continued to be charged on my account at the full rate. Despite having paid back in excess of £13k to Paragon/Universal, my balance now stood in excess of £14k."

And yet more...

"hi i am also peed off with paragon borrowed 9000 quid 6 years ago. lost my job so they directed me to the c.c.c.s. we have paid aprox 6ooo back to them. but received a letter stating debt passed on to arrow receivables, the amount was for over 14,000. "

"About 14 or 15 years ago I got a loan for £3500, due to certain circumstances I had to go on to reduced payments for a while. While I was on reduced payments the company I got my loan from was taken over by Paragon Finance, I was never advised of this either in writing or by telephone. A couple of years ago I wrote to Paragon Finance asking them how much I would have to pay to clear this debt and was gobsmacked - to say the least - when they told me they wanted over £14,000 back because of interest accrued. I immediately asked them for an itemised accounting of this which they sent. When I looked at it they had been charging me over £400 per month in interest - my original monthly payment had only been £127! I have now had to go into an IVA to try and clear this debt."

" took out a £5,000 loan with Universal Credit in 1996, which unfortunately due to circumstances defaulted on after paying the bulk off. I heard nothing until approx two years later when I started receiving letters from Paragon Finance (they had apparantly bought the debt - but I didn't get to the bottom off this until recently). Having had no previous dealings with Paragon I asked them to supply details of the debt so I knew what I was being asked to pay. I heard nothing for a further year, when a bailiff turned up. Once again I contacted Paragon asking for details, and again heard nothing. Things continued in a similar vein until March this year when out of the blue I received a letter from them informing me that it was for the loan I had with Universal (although they provided no copy of the agreement) and that they had already taken the case to court and obtained a charging order on my property.I requested a statement and balance (as until this point various figures had been bandied about - going up and down like yo-yo's) and started making payments of £30 a month as a goodwill gesture, however I heard nothing from them until today.Had a letter from them this morning - written in some form of financial jargoneeze:"I can confirm that the balance outstanding under the Judgement Order is £4617.24 and the balance outstanding under the contract is £22107.21 to date."

Reviews on Paragon Finance.

These comments come from www.reviewcentre.com.

"We borrowed £3,000 in in 1989 after our bank - Nat West - had turned us down and suggested we use a loan firm out of the paper. We chose Universal Credit which were later taken over by paragon. Universal Credit sent you statements, paragon have never sent a statement. From 1986 to 1993 my husband, who is in the construction industry, was made redundant three times which obviously affected our ability to pay back the loan in three years. He then went to college for 4 years when I believe we had the interest frozen. I have absolutely no idea what we owe at this moment in time but we have paid £60.00 a month for the past 6 years. What I would like to do is to offer them something like a £1,000 and be finished with the whole damn thing but I don't think it will ever go away-I have a daughter the same age as this debt, 16 - how ridiculous is that? It's an albatross I'm determined to be rid of. "

"We have a similar story, a loan taken out with Universal Credit. After money problems we are paying at a reduced rate, can't find out how much is owed. They never send statements and we were actually threatened with legal or 'some other form of action' not sure what that meant."

"Totally agree. My ex-husband and I took out a loan (in my name as he was made bankrupt)for £7,500 just before we separated. On separating I was informed as it was in my name I was now liable for the loan. Like other people I have never had a statement from Paragon despite many requests. For the past 6 years I have been making reduced payments on what i believed to be reduced interest. On receiving a statement last week (after many phone calls from myself to Paragon) I was staggered to discover I now owe £24,500!. Unknown to me they have been charging me up to £300 a month in interest. HELP!"

"me and my husband have the same problem we have been paying a 15.000 loan with paragon took out 9 yars ago we made full payment for about the first 3 years and for the last six have been making reduced payments through the consumer credit council who have now contacted us to say that it has been brought to their attention about the amount of interest we have been charged and our debt now stands at 28,000 pounds. when will it end. the ccs have instructed me to request a full statement of all charges from the start of the loan, i should not pay for this even though they will try and charge me when i receive this i need to make a complaint in writing to them they have 8 weeks to respond after this i will need to take this to the fsa obundsman ccs have informed me that there are many cases being highlighted at the moment and i should not let it go. they are encouraging everybody to do the same. please please do not let this company get away with this. we all need to make compaints and take this to the fsa. you can contact your local cab for the ccs number they are very good and are a charity set up to help people in debt all their staff are very friendly and helpful you can also find info on paragon on the office of fair trading. good luck and dont let them get away with this ."

"Same Problem here borrowed £4999 in 1994 got into trouble and went with Gregory pennington a debt management company to reduce the payments and freeze the interest which i thought had been done as i have been paying Penningtons every months since 1996. Checked up last month only to find that Paragon had not stopped the interest but also added compound interest on the arrears the result being they now want £17,000 when i have already paid them £12,000 in payments. Help Pleaseeeeeeeeeeeeeeeeeeeeeeeee"

Paragon send a statement

After many attempts at getting a figure of exactly how much is owed on the account I finally received a statement from Paragon. Normally they don't like to tell you how much interest they have been adding and always refuse to give a figure on the phone.

The statement shows the account was opened on 27/03/1995 with a balance of £6000. Monthly payments of £142.41 continued until 03/01/1999 when I first visited CAB to seek advice about debts I could no longer afford. At this time the balance was £4212.47.

CAB made an agreement with Paragon (and Barclays who I also had a debt with) to receive token payments of £1 and for the interest to be frozen. Paragon agreed to this (as did Barclays). Barclays kept their agreement and the balance was paid in full some time ago. Paragon kept me in the dark, they added interest without informing me.

The first reduced payment was made on 03/02/1999 for £1, Paragon added £86.28 interest (but I didn't find out about this until many years later). By the 26/11/1999 I increased my payments to £10 per month. Paragon added £109.74 in interest that month. At this point Paragon wrote to me and said they would consolidate my arrears if I agreed to pay by standing order. No mention was made of the balance or of interest being added. By this stage the balance was over £6000.

Payments at £10 by standing order continued until October 2002, by which time Paragon added £192.87 for every £10 I paid. I upped the payments slightly to £15 and then £20 a month, Paragon added £240.38 a month in interest, by now the debt was spiraling out of control, but I still though the interest had been frozen and Paragon happily accepted my reduced payments.

On the 25/02/2002 I agreed to start paying the full monthly amount as I had largely sorted out my fiances. What I didn't know was my balance was now £13,203.54. I started making payments of £145 a month in the belief I was now paying off the debt and would clear it within a few years. I carried on paying £145 a month until 11/01/2007 when I discovered the balance was £12830.62. Only slightly less than four years earlier. The reason was Paragon lied about the interest and all I was doing was clearing the interest each month.

From 05/02/2007 to 12/05/2008 I paid £176 a month. Then after taking some legal advise I was told to let Paragon take me to court.

My total payments come to £15,227.27. Paragon claimed I still owed £12,000

Legal threats from Paragon

Today's letter from Paragon included a threat of legal action.

13th August 2008

Dear XXXXXXX

I am very concerned you have chosen to ignore previous letters.

We are here to help you but can only do this if you make contact with us so we can discuss any difficulties you may be experiencing.

It is now essential therefore that you contact me upon receipt of this letter.

If this letter is ignored, I can only presume that you do not require assistance and you simply have no intention of making payments on your account. If this is the case then I would advise you that we have no alternative than commence legal action against you.

Please be advised your account may be charged a fee should we be required to write or call you regarding outstanding payments.

I would urge you to read this letter carefully, fully considering it's potential implications

Yours Sincerely

Jessica Smith

collections officer.

I have since contacted Paragon to invite them to commence legal action as I would like to get this before a judge due to the large amount of money I have already paid to try and clear the debt.