Hello dtr1002 and welcome.

I'm not aware whether RBS are obligated to pay this money into your DAS. I can see why they'd prefer to set it off against the debt owed to them.

DAS isn't insolvency, so I'm not sure whether there is a way to force the issue.

One of the experts here may know more.

Thanks - will wait to hear other advice.

Good old RBS are offsetting PPI in DAS, Trust Deeds, sequestration etc.

I understand that this is being looked at and hopefully someone will raise an action and force a decision one way or another.

Mark

Thanks Mark - is there a question of process here. I would like to know how that process will operate. So RBS says we will offset however they know what they can and cannot legally do in terms of making a payment to themselves in respect of a debt that has already been incorporated into a legal payment arrangement that requires consent for a 'windfall' to be paid from the DAS admininstrator and also requires this to be done equitably for all other creditors. What should I do if RBS award themselves the PPI in offset of the debt disregarding the legal terms of the DAS? I have already alerted them to the relevant parts of the legislation. Does the DAS effectively limit the banks right of offset?

It will take someone to raise a legal action against the bank, possibly a trustee under a trust deed or sequestration to see if the payment to the trustee can be enforceded.

Mark

quote:

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Originally posted by dtr1002

Thanks Mark - is there a question of process here. I would like to know how that process will operate. So RBS says we will offset however they know what they can and cannot legally do in terms of making a payment to themselves in respect of a debt that has already been incorporated into a legal payment arrangement that requires consent for a 'windfall' to be paid from the DAS admininstrator and also requires this to be done equitably for all other creditors. What should I do if RBS award themselves the PPI in offset of the debt disregarding the legal terms of the DAS? I have already alerted them to the relevant parts of the legislation. Does the DAS effectively limit the banks right of offset?

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I don't think that the DAS Administrator has any say in what happens with 'windfalls'.

Mark is right about the way the banks are dealing with PPI refunds - offsetting the money against debts owed to them. Even if the debt is included in DAs, trust deed etc.

If you're going to fight aganst RBS on this one,I think you need to be clear about what it is you want.

If you want RBS to pay the full refund into your DAS, so that it is shared equally among all of your creditors, that would fit with your interpretation of the regulations.

If you want RBS to pay the refund towards your mortgage arrears only, then you've accepted the idea of RBS giving one of your creditors preferential treatment. You're now arguing over which individual creditor should get all the money

Thanks for the comments - the more views that I can hear, the better informed I will be I guess as I am trying to interpret what the legal position is in respect of the DAS regulations.

In that banks view - what is the value of the debt?

a) Is it the remaining balance of their debt in the DAS

or

b) Is it their accrual of the debt including fees, interest and charges disregarding the DAS debt balance?

I ask this question as I realise if the value of the debt is as described in a) then setting off in respect of the creditors debt or paying to the DAS distributor to equitable pay means that for me, the debt is reduced by the value of the asset. If b) The effect of the asset will be diminished as the debt will be higher.

Tell me if I'm getting this wrong please;

The requirement to ensure "assets" are distributed fairly arises from;

"(2) A specified condition is that the debtor mustÔÇö

(a)realise, and distribute amongst the creditors the value of, an asset of the debtor other than an asset excepted by paragraph (3);"

However, this assumes that the asset is in the debtors possesion - in the case, the asset is held by a creditor so we must look at the status of the debt, in terms of how it becomes encapsulated and defined in the regulations.

33 - Effect on a creditor;

"(c)a creditor must not attempt to persuade the debtor to withdraw from the programme, or to make additional payments in respect of a debt included in the programme;"

- does this mean that by applying a right of set off using the creditors own funds, the creditor is effectively disregarding 33c?

The mortgage arrears are not part of the DAS debt, although the mortgage lender is clearly a creditor. I would suggest that we request that the asset be distributed pro rata amongst all the creditors including the mortgage lender who would in that case, receive an amount similar to that which would be received by the creditor.

I guess I should write to the creditor quoting their prior "If you are subject to alternative fiduciary arrangements...any disbusements due will be managed by the groups insolvency team" asking how they intend to disburse the funds?

Obviously my preference would be to address the mortgage arrears.

Help please?

Hi there.

RBS believe that they can set-off PPI claims against debts. They're doing this with trust deeds. Will that be tested in court? Perhaps. Until then they'll keep the money I'd have thought.

I'm sure they'll see DAS in the same way, and instinctively it feels like that argument will be stronger.

We cannot tell you the legal position though, you'd need legal advice for that and it seems to be unclear anyway.

In the nicest possible way, it seems a little like you want it both ways. You object to RBS preferring their own debt, argue that it should go to your DAS, but then yourself want to prefer (to some extent) your mortgage arrears. I'm not sure you'll get to that point.

I'm just speculating though and I hope someone here can help you further.

Me too. Thanks for your comments.

I got 3 PPI refunds from RBS (3 seperate credit cards) - all 3 were offset against outstanding debt. Neither I or my trustee saw a penny of it [:(]

That's the thing really fcwalker.

There's perhaps a technical argument as to whether they can or cannot do this. In reality however they've decided that they can, so anyone seeking to challenge it is likely going to need really deep pockets and might still not get the outcome that they hoped for.

Thanks fcwalker and TDA. An important question might be; At the commencement of the DAS all interest and charges were frozen. Therefore, is the banks perception of the debt the same as the value of the balance of the debt as recorded in the DAS account?

In not, and the bank can effectively re-instate it's charges under a set off condition, what protected status does the debt actually legally have?

Bearing in mind that the creditor has either accepted or has been deemed to have accepted the DAS arrangement. Does the debt therefore legally reduce during the period of the DAS or is it merely extinguished on completion of the DAS. Will the bank offset against it's accrued value or the one recorded in the DAS.

I have no idea what the bank's "perception of the DAS" is. If you want to know what their perception is, you'd have to ask the bank.

You committed to paying back the amount you owed when the DAS was approved. Interest and so on is frozen from that point. If you complete the DAS as agreed, those charges have to be written off.

If a creditor agrees that a PPI refund is in order, and offsets that refund against the debt owed, then the DAS would look like this:

amount included in DAS

less

amount paid to DAS so far

less

amount offset for PPI

equals

amount still to be paid through DAS.

In summary, irrespective of contractual/legal rights of the matter, the bank have adopted a position which they believe to be correct and appear to be maintaining that position until it is challenged legally.

Mark