In March 2017, the Court of Appeal decision in the Green v Wright case was published: Mr Wright’s IVA firm was allowed to collect PPI after his IVA ended, even though he hadn’t consented to this before his completion certificate was issued.
As questions about this continue to arrive, I thought it would be useful to summarise the current situation: what is clear and what is less clear.
The Court of Appeal decision
The full decision is here: Green v Wright verdict. Here are some articles on the decision by some of the lawyers that have been involved:
- Paul French’s blog: PPI claims survive completion of IVA for creditors (he was the barrister for the IVA firm in the Appeal);
- Kathryn Maclennan’s blog: Green -v- Wright: complete does not necessarily mean complete (she was the solicitor for the debtor in the original court case).
Before you read on:
I am not a lawyer and I can’t give you advice on what you should do. When I say things like “I cannot see” or “This seems very unlikely”, I could be wrong. I am giving a layman’s opinion, hoping it will help you to consider your own situation.
If there is a large refund involved, you may want professional advice. You can go to your local Citizens Advice or a Law Centre – that would be free – or you may prefer a solicitor with experience in personal insolvency. If you decide to go to court over this, you have to consider that if you lose you may have to pay not just your own legal costs but the other side’s as well.
Common misunderstandings
Here are some points that keep cropping up which are worth emphasising:
“My PPI was for a debt that wasn’t included in my IVA as it had been repaid”
This doesn’t make a difference. You had the right to reclaim PPI at the point your IVA started and it is this right which is an “asset” of your IVA even if you didn’t realise it.
“My IVA says that it includes windfall assets received whilst IVA is open, but it is now closed”
This is a standard clause in most IVAs but it isn’t relevant to the PPI issue. PPI is not being claimed as a windfall. PPI is being claimed for your creditors because the right to make a claim was an asset you owned at the start of your IVA, this has nothing to do with the windfall clause.
“They will try to get any money I inherit – this is never going to end!”
This isn’t going to happen. An inheritance (or lottery win, or taking money from your pension etc) is treated as windfall if it happens during your IVA. But after your IVA ends the money is yours if one of these events happens. The court case doesn’t relate to windfalls at all.
“I would have been better off going bankrupt”
That may be correct. But PPI isn’t relevant to this – if you had gone bankrupt all the PPI would have gone to the Official Receiver.
“It’s not fair because this wasn’t explained to me at the start”
When your IVA started no-one had any idea that this court case would happen. You can’t blame your IVA firm for not telling you something they weren’t aware of.
“This only applies to PPI”
I would expect it to apply to other similar “refunds” eg for payday loan affordability cases, pension mis-selling etc. The principal is that you had the right to make a claim at the start of your IVA, even if you were not aware of this at the time.
The simplest cases
“My IVA hasn’t finished yet”
If your IVA is still in progress then your IVA firm has the right to collect this PPI. If you refuse to co-operate with the claims company they appoint, you could be in breach of your IVA terms by refusing a reasonable request and your IVA may be failed.
“I have made my last payment but they won’t give me my completion certificate unless I agree to them collecting the PPI afterwards”
If you don’t sign they will keep your IVA open until they are happy they have collected all the PPI, which could be years. It’s your choice, but I can’t see any options which will let you get the PPI money.
“I had to sign documents authorising them to collect PPI before I got my completion certificate”
Many people in the last few years have been asked to sign a deed of assignment saying that any PPI paid after their IVA completed should go to their IVA firm. The Court of Appeal case doesn’t change this.
In any of the above situations, the PPI is going to your IVA firm, I can’t see anything sensible you can do to stop this and there isn’t much point in you reading the rest of this article.
Mr Wright’s IVA used R3 standard terms and conditions
The Appeal Court decision was that Mr Wright’s IVA created a trust which did not end with the completion of the IVA unless there was specific wording to state it ended. This wording wasn’t in Mr Wright’s completion certificate.
The Appeal Court decision was based on the specific terms and conditions of Mr Wright’s IVA, which in his case had used the R3 standard terms.
If you aren’t sure if your IVA used these terms, ask your IVA firm or dig out your IVA documents. If you see Produced by the Association of Business Recovery Professionals this is an R3 IVA. Anything that says Consumer IVA Protocol is not an R3 IVA.
Let’s look first at the situation if you have an R3 IVA, then at how this may change if you don’t.
For people with an R3 IVA
If your IVA used the R3 terms, you should assume the Appeal court decision applies to you. It is highly unlikely that your completion certificate would have had any wording to bring the IVA trust to an end. The same argument – that specific wording is needed to end the trust – is likely to apply even if your IVA completed with a full and final settlement or failed.
Claims which haven’t yet been paid out
If a PPI complaint is upheld, it is very likely that your bank will ask the IVA firm if they should have the money, the IVA firm will say Yes (because of the Court of Appeal decision) and the bank will pay it to them. If this happens there is very unlikely to be anything you can do to challenge this.
Thinking about some possible exceptions:
- if your IVA is so old that your IVA firm can’t be located, I think the bank will eventually send you the money. See A PPI claim after an old failed IVA for details.
- If your IVA is so old the firm no longer has enough records for it to be able to distribute IVA to your creditors, it may be happy for the money to come to you. If you have an old R3 IVA you could enquire about this.
- If your creditors have been paid in full, the money should come to you. You are entitled to ask your IVA firm for an account which shows how much money has been distributed. If you are thinking you may be near the full payment point because a lot of PPI has already been reclaimed, don’t forget that a large proportion will have been taken by the claims firm and not gone to your creditors.
Will your IVA firm be trying to reopen old cases to reclaim the PPI? That is likely to depend on the firm. I have heard that some firms don’t intend to reopen these cases, but if you start the complaint, they will claim the PPI.
If your IVA firm wants to reopen your old case and asks you to sign something to allow them to reclaim the IVA, it isn’t clear that they have any sanctions against you if you refuse. If they mention the Green v Wright decision, you could ask them what will happen if you don’t sign.
You could also propose a solution in which you split any PPI reclaimed – half to you and half to the IVA firm. If your IVA firm agrees to this, you need to get it very clearly in writing. Also you do not want their claims firm making the complaint and taking a huge cut first – offer to make the complaint yourself.
PPI has already been paid to your IVA firm
There is nothing you can do about this.
PPI has already been paid to you
If you have spent the money, this is a very worrying situation. It seems unlikely that an IVA will be aggressive in this situation – who should it pursue, you or the bank who sent you the money? And if you don’t have any assets, it’s hard to see how pursuing you could produce any gain for the creditors. Don’t let yourself be pressured into doing anything silly like trying to borrow this money to hand to the IVA firm – just explain your situation.
For people with non R3 IVAs
There is no legal clarity for non-R3 IVAs. There hasn’t been a court decision on any of these cases and they can have very different terms. Some could be close to an R3 IVA in the areas that matter, but some may not be similar.
It seems unlikely this is going to change. It is hard to imagine a debtor is going to want to go to court, given the costs that Mr Wright has ended up with after losing his case.
In most respects similar points apply to those on the R3 case above, except the IVA firm itself is on less solid legal ground. You may decide that they are largely bluffing… but this still isn’t a very comfortable position for you to be in. If you feel you are being pressured unreasonably, put in a formal complaint to the firm and then to the IVA Complaints Gateway.
IVA firms may take different views.
- Some may choose not to try to reclaim PPI after a completion certificate has been issued if no deed of assignment has been signed.
- Some may try to reclaim, but it isn’t clear what possible sanctions they have if you refuse to co-operate.
- If you try to reclaim PPI, it seems pretty likely that the bank may pay it to your IVA firm.
- Some firms may agree if you offer to split the PPI.
- If PPI has been paid to the debtor and spent, again it seems unlikely that the IVA firm will pursue this aggressively.
In 2018 and 2019 ClearDebt and Aperture have been sending out letters that some customers feel are threatening about allowing the firms to make PPI and other financial claims for IVAs that have completed or have failed some time ago.
Some firms such as Freeman Jones say they have no interest in any PPI or other refunds for IVAs that were closed more than three years ago.
Comments
You are welcome to comment below but I cannot guess what your IVA firm will choose to do and I am not going to speculate.
After the Appeal Court verdict in March 2017 this article was re-published with up-to-date information.
Neil says
Thank you for such a quick reply ….just one other question will they send the cheque to Aperture or send the cheque to me to forward to them .. i lost most of my paperwork once all the creditors started coming for me as GT said it was now my problem so if i just ring Aperture they should be able to bring up my details,but if not do i get Aperture to send me a letter to say they have no claim to the PPI or get them to write to Barclays …Thanks again
Sara (Debt Camel) says
They will probably send the cheque to Aperture.
Jennifer says
Hi
I had an IVA in 2009 which was completed during the same year as I became redundant and my creditors accepted the payment in settlement.
I have now been awarded £2.4k in PPI from Barclaycard who are managing Egg who was one of my creditors.
They say they are looking into whether or not my IVA company still have an interest in it. My IVA company don’t exist anymore and I can’t find who has taken them over.
I have found some old documents and can’t find any mention of the R3 wording, but is it too old?
The proposed variation of accepting my redundancy payment, which the creditors agreed to does say ‘in full and final settlement of my obligations under the agreement’. Does this bear any weight?
Many thanks!
Sara (Debt Camel) says
That’s very old. If your IVA company can’t be traced, the money should come to you.
Jennifer Mannion says
Many thanks for your reply.
Is there any time limit on how long they can look into it? It’s been about 6 months now, and when I chase them they just say it could take a long time as they need to go to the courts to get my IVA documents and what with covid blah blah
Sara (Debt Camel) says
No – I would give it another few months before you start threatening to go to the ombudsman.
Lily says
My IVA was completed in 2006. I have recently claimed some PPI which has been calculated, but the bank has contacted the original IVA Supervisor. Can he say that he doesn’t want the money, as it is so long ago?
Sara (Debt Camel) says
Yes he can. And he may also not have the records any more…
Lily says
Thanks, Sara for the quick response.
If IVA Supervisor still has the records, would he be obliged to take the money?
Is it worth me asking the him what he will do?
Thanks!
Sara (Debt Camel) says
Sure. And then ask about the records if he says he wants the money…
Andrea Smith says
We hompleted our IVA in 2008 when we received a sum of money inheritance following the deaths if my Husbands parents. We made an offer to the IVA company of roughly 50% of the remaining debt….we had been paying monthly for around 12 months. On completion, we received certificates and documents stating we WOULD NOT be chased for further payments. We have now received 2 letters from Santander, Aperature have approached them for PPI…surely any remaining debt is no longer valid after 12 years?
Sara (Debt Camel) says
We have now received 2 letters from Santander, Aperature have approached them for PPI
who put in the PPI claim – you or Aperture?
Carl Fisher says
Hi All
The IVA we had finished in 2019, paying back a total of 116p in the £. Every creditor received 100% of the money owed to them and the IVA company Aperture IVA received a significant chuck of money, which they did very little for.
I am after some help and advice, since completing our IVA we have been made aware by our creditors of owed PPI payments too us, each of these cheques has been sent to Aperture and they have failed to make any payment back too ourselves, this has been on going since June 2020 and they are withhold a significant amount of money that isn’t theirs. They do not represent us anymore as we completed 100% of our IVA. They have refused to help over the telephone and only provide an email address which they never respond too.
How can i get this resolved and gain access to the money that is rightfully ours.
Cheers in advance.
Sara (Debt Camel) says
Send a email with the subject COMPLAINT to complaints.supervisor@aperture.uk.com. Detail what has happened and Aperture’s failure to communicate with you. Say you want the PPI money sent to you within 8 weeks or you will be sending The complaint through the Insolvency Service gateway.
Carl Fisher says
Thanks Sara, this has been going on since June. They told us the money would be release in 90 days, its now day 106. Their trust never responds to emails and their customer assistants are not allowed to get involved with PPI queries.
I will send the email but hold little hope of them responding at all, inly ever received automated email response.
Rick Borman says
I see Sarah’s advice and will be doing same. I was with debt free direct which transferred to Aperture. My iva completed successfully in approx 2016 but I received a PPI payment in 2018-2019 which was sent to my iva company which by now was Aperture. I have been trying for a full year to get Aperture to even respond to any email or letter (all I have asked for is confirmation of receipt and a breakdown of how the £7k was changing the status of my iva with respect to my debtors)!
Carl Fisher says
Hi Sara
After following your advice I have now received in writing notification that money owed will be payed to me in early October. They have confirmed the exact amount and provided the breakdown of what I will receive minus the PPI company fee.
Regards
Emily says
We completed IVA with DFD in 2016, with the clause in the closure that any PPI would be claimed and paid to them (they instructed Equity in Finance to do so). All good. We had no idea DFD had subsequently shut down.
We recently received notification of a potential PPI payout and contacted EIF to see what to do with it and they said they hadn’t made the claim. Turns out FDM had made the claim – I have no idea who the are and/or how they were instructed.
Googling told me Aperture and FDM are linked and Aperture took over DFD, none of this has ever been told to us in the four yrs since completing the IVA. I’ve now contacted Aperture to try and find out who the heck is dealing with our case and they, so far, have no clue who we are! If they don’t have a case file passed on from DFD how did FDM get our details to claim PPI on our behalf. Can they do that without us signing anything? Without us knowing that another company had taken over our case?
As it stands the payout is most likely coming to us but what do we do with it if Aperture don’t know who we are?
I’m not handing over a cheque to a PPI claim company that I know nothing about and never instructed as I can’t be sure who they would even distribute it to as no one seems to be our IP anymore?
Sara (Debt Camel) says
If Aperture have no case records for you, the refund should come to you.
I don’t know how FDM got your details – you could send them a formal complaint and ask them?
J McLaren says
Good day. Equity in Finance (EIF) have been instructed on behalf of PayPlan to recover any PPI. I received a call from EIF to advise that PayPlan no longer hold any interest in my PPI claims and that Santander have made an offer, which i did not know about. EIF advised that they can continue looking into the PPI cases privately, but for a fee. Not knowing the details of the accounts under investigation, i verbally agreed. The following day, i receive the offer in writing from Santander, advising they want to pay me direct. Companies such as EIF, are they paid by IVA companies on a no win-no fee basis or given a standard fee for their work? I have not signed anything for EIF to act for me but it will save £40 from the offer from Santander, if Santander pay me themselves? Am i legally bound to have to give EIF their £40 commission on a verbal agreement, awaiting their revised contract as i was not aware that Santander could pay me themselves?
Sara (Debt Camel) says
I don’t know how Claims firms are paid by a PPI company but it doesn’t seem relevant here.
What matters is that you agreed to EIF pursuing your claim in your behalf. Were you told what the EIF fees would be? Are there other complaints still being investigated.
Matt says
I completed my IVA and repaid the Trust 100%. A PPI claim was successful during the term of the IVA. Final payment made July 2018, Closure report signed June 2019. I recently received a letter from Lloyds detailing PPI Recalculated interest. The IVA company and a CMC are taking 53% (£1225.05) of that refund. Claiming its part of a Post IVA Trust. Despite there being no creditors to claim any further money, I am the sole beneficiary of the Trust and any further redress. Its seems although I am the beneficiary, they want to take 53% for fees regarding claiming mis-sold PPI! They’ve already been paid a fee for that during the IVA surely, so are they now just exploiting ex IVA persons to make fast money?? Anyone else had this situation?
Zoe says
I took out an Iva with grant Thornton( aperture) , this ended and paid up in 2014 they also made claims to all companies I’d ever had debts with some of which had were paid off before Iva one Ppi refund was a large amount from a bank not included in my Iva , I was disappointed I would not get this and left it there I received my completion cert in 2015/16 now 4 years later the same bank have contacted me to say they had recalculated and owed me another 1000 and paying it to a company called Jarvis , I have had no dealings with this company who apparently have taken over apertures open cases (mine was closed ) I spoke to them who advised me to email Iva trusts , I have not heard from aperture since 2015 and thought this was all over they replied with the response that they will have the money even though as I said it was from something not included with Iva debts , I also asked to see proof that the money paid from myself and the ppi was in fact going to the creditors as after all this time I think they are keeping the funds themselves they will not respond and also will not send me in writing that I no longer have any ties to them because i did this to get a fresh start and rebuild my self and I feel like this is never ending , these companies should be looked into judging by all the
comments on here of how they take advantage of people in a vulnerable situation
Carol collins says
Hi I took out a Iva in 2010 over 60 months and was with Debt free direct and had a completion certificate in March 2016 I, only found out that Aperture was taking over the ppi claims in 2019 , I had received a big amount of money from ppi whilst in my Iva, which went to Dfd and just recently had two more large amounts from ppi monies sent to Aperture, after calculating everything the whole total of my Iva has been totally paid, and there is a substantial bit of money left, will I get a refund, I have sent Aperture all the details and copied in the ombusman in the e mails
Thankyou
Sara (Debt Camel) says
I hope you will, but between the claim firm and the IVA firm a large chunk is removed from PPI refunds.
Carol collins says
Thank you Sarah, can you confirm was informing the financial ombusman the right person to complain and look into this for me ? Thankyou
Sara (Debt Camel) says
no FOS will not look into anything to do with an IVA. You need to complain first to your IVA firm then to the Insolvency Service Gateway.
Carol collins says
Hi thanks for that do you have the e-mail address for the insolvency service gateway, and thanks again for your help
Sara (Debt Camel) says
see https://debtcamel.co.uk/complaint-iva/
Samuel Nicholson says
I was in a Iva which was completely in September 2016, since then I have received 4 ppi refunds from rbs(NatWest) who were in the Iva. 2 were in sept 2016 which were paid to me and now recently 2 more in November this year one has been paid but they have kept back the last one! Saying to pay off some of the money I owe rbs(NatWest). What is confusing me is that why weren’t the other 3 refunds kept back to pay off some the money also when I spoke to DMO at NatWest the lady said the money I owe is a total over all the accounts i had with NatWest so she wasn’t sure why this one has been kept back when the other 3 wasn’t. Also why does it say I owe money when the Iva is completed
Any help with this as I was going to complain to them to get the refund paid but need some advise
Many thanks
Sara (Debt Camel) says
What is confusing me is that why weren’t the other 3 refunds kept back to pay off some the money
this may have something to do with whether the original lender had sold the defaulted debts to a debt collector and the terms of that sale.
It is standard practice for PPI refunds to be offset against any remaining balances in IVAs and DROs. You can argue about the legitimacy of this but you are pretty unlikely to win a case at the Financial Ombudsman.
Jamal says
With a lot of difficulty and family suffering my IVA with DFD had completed late 2014 as my creditors were paid the amount agreed in the setup of my IVA.
A trust to collect ppi had continued until Nov.2019 when my IP ( the same IP through the transition from DFD to Aperture) had issued me a letter confirming that she had decided to bring the trust to collect ppi to an end eff. 22/11/2019.
She had explained in clear language that as the trust had been brought to an end ppi payments would not be sought or accepted from any lender and all such payments from lenders would be paid to me.
Furthermore, from time to time lenders may still issue payments to Aperture and if so even such payments would be returned to lenders who would be advised to pay direct to me.
Despite this, since approx May 20 I have been receiving correspondence from Barclays and other banks confirming amounts to be awarded as claims are upheld but then advising that as there is IVA involved they would be paying the IVA co.
When I contact the banks and explain the above and even email them the trust closure document of Nov 2019, the banks advise that Aperture apparently are still telling them that they have an interest in the ppi and for the payments to be sent to them.
During latter May 20 I did manage to get through to Aperture by phone before they closed phone lines citing covid pandemic. The Aperture advisor had checked and agreed that my case and trust had finalised and closed and reassured me that any ppi payments issued to them would be returned to lenders to be redirected to me. Since then even email correspondance is sporadic and difficult.
Some time later during late Jun 20 I received an email from Aperture advising that although my IVA and trust are closed they had carried out a review of cases brought over from DFD and apparently after everything was settled there was a credit owed to me of £6k and to give my bank details for refund.
I responded to send me the refund but also reminded them that Barclays were waiting for Aperture to return 2 p/mnts which had been issued to them so that Barclays could pay me directly. I had emailed them the iva trust closure document of Nov 2019 aswell, if only to serve as a reminder.
After this Aperture just replied by saying that my case is apparently under review. No refund or any further emails from them.
Jamal says
During Sep 20 Barclays issued me one of the payments which had initially gone to Aperture. Apparently because Aperture did confirm to Barclays that they did not have any interest in my ppi.
However, since then no further positive news and infact Barclays advise that they are surprised that even as recent as Nov 20, when contacted, Aperture apparently again say that they have an interest and payment should be sent to them.
I am very frustrated and feel helpless and cannot help but feel suspicious over Apertures motive.
I have spoken to the Financial Ombudsman and they have advised and agreed for me to cc them in all my emails to the banks and Aperture. They have also advised that the insolvency service could also help. Barclays have advised me to contact the FCA too regarding the conduct of Aperture.
Its almost unbelievable how Aperture can behave in this distasteful and almost underhanded way and seemingly get away with it.
I really feel like I am spinning around in circles and emotionally drained by all this. Its surprising how much emotional energy this stuff takes out of you.
Ever since my IVA had started I and my family have struggled and suffered calamity. I had to leave my job after the maternal death of my wife and subsequently my youngest child before the IVA trust had closed. I am a widow looking after my other children.
Without wanting to blame anyone and apologies if I am being melodramatic but I feel that this thing is still reaching out and trying to put chains around our necks and I would be so grateful for any helpful advice from you sara.
Sara (Debt Camel) says
I suggest you send a formal complaint to your IP that wrote you the letter. If the contact details are not on the letter, you can find them here; https://www.gov.uk/find-an-insolvency-practitioner
Jamal says
Hi Sara,
Many thanks for your reply.
I will do as you suggest and complain to the IP who had ended the trust.
I will try and email her the complaint and attach her letter of Nov 19 and cc in the ombudsman and insolvency service in the email.
I will let you know how it goes.
Kindest regards,
Jamal.
Paul says
Dear Sir or madam, l am sending you this message as I at the time I did have an IVA account with you which was dealing with my debts I had then. This was back in 2006 to 2011 but on completion I was sent a statement of it being completed during that period. I would like to request a letter concerning this if it is possible from you for me. Yours faithfully, P Turner. Account number 905935.
Sara (Debt Camel) says
You need to send this to your IVA firm. Not post it here.
Lyn says
Hi hoping you can advise
We had an Iva which finished in 2015 majority of ppi went to the Iva we had one with RBS and Iva people said no interest in money so rbs have kept it against the debt we had after the Iva are they allowed to do this
Sara (Debt Camel) says
yes, this is what commonly happens.
Lyn says
Left message last week haven’t had a response yet regarding an Iva and ppi, Iva company not interested but the bank have kept the money to pay off the debt that was in the Iva is this allowed
Even though the debt should have gone with the IVA
Sara (Debt Camel) says
As I said, this is what normally happens in an IVA and in a DRO. Although legally you are right that the debt no longer exists. If you take the complaint to the Ombudsman, the Ombudsman usually decides that what the firm has done is fair I am afraid.
Lyn says
Hi
The company that was trying for the ppi are now charging us even though we didn’t get the money they are saying because it’s been used to pay the debt owed we have been paid out so now we have to pay them can you advise please
Sara (Debt Camel) says
is the claims company FCA approved?
Did they ask if you had had an IVA?
Andrew says
What happens if the iva has been paid off but the debts were in mine n my ex-wife name , these have all been paid off . My ex-wife wasn’t in an iva . But they want me to sign a form to claim the PPI outstanding, but my point is , surely they won’t be able to claim it as in both our names . And why legally should they get it all when my ex-wife wasn’t in a iva . Surely half of it is hers if they successfully get any
Sara (Debt Camel) says
Your ex should be entitled to get her half of the PPI on joint accounts. I suggest you tell the IVA firm this and say you want them to confirm this in writing before you sign the form.
Michelle says
If the IVA was finished over 6 years ago and nothing paid since doesn’t that make them statue barred so really the debts are wiped and the ppi money should go back to the client
Sara (Debt Camel) says
No that’s not how these refunds work. A debt legally exists even if it is statute barred. So PPI can be offset against it.
CG says
I had an R3 IVA and it was completed (with certificate) in Jan 2018. Due to the R3 wording, I have had all of my PPI / mis sold claims since that date continue to be claimed in full by the IVA managers to go towards any outstanding costs / debts claimed on the IVA.
I wanted to know how much liability was remaining on the IVA (i.e., if I continued to have PPI / mis sold claims paid in, at what point would they fulfil the debt), so I asked the Insolvency Practitioner. They came back with a figure that had added a further 50% of the amount that I had originally agreed for the IVA.
Is this the correct amount / normal practice?
Sara (Debt Camel) says
The amount you agreed to pay in your IVA (eg 60 payments of £160 a month) isn’t relevant here. The firm will carry on collecting more money for the creditors until all your debts have been paid in full plus the IVA firms fees..
CG says
Thanks.
For example, (using round figures for illustration) let’s say that the whole IVA originally agreed was £50k, and £30k was paid back before it finished/formally completed. £15k of other claims have been paid through PPI / mis sold claims since the end of the IVA (due the R3 terms), but the Insolvency Practitioner (IP) are now stating that the amount for the final debt to be cleared is another £40k on top of what has already been paid. So the IVA has been increased from £50k to £90k, without formal notification or agreement, even though £45k has been paid back on the original debt.
I thought that the debt was the agreed amount at the beginning of the IVA (rather than the actual amount paid by the end of the term), which included the fees, but not the interest. If I pay the amount quoted by the IP, I will have completely the original agreed amount, plus more than 50% of that amount on top: that implies that the fees imposed by the IP are a further charge of 50% of the original agreement and fees. I am struggling to see that as an acceptable level of interest / fees to be charged for an IVA.
Sara (Debt Camel) says
£15k of other claims have been paid through PPI / mis sold claims since the end of the IVA
If those were the refund values, you have to take off the claims companies’ high fees. And then the IVA firms pockets some more.
Plus your IVA may say that in a final settlement, statutory interest is added – that is 8% per year on your debts.
The whole thing is pretty outrageous.
CG says
In terms of the example, £15k is the amount credited by the IP after the claims companies fees, not before.
Statutory interest of 8%per annum is comparatively fine, but fees that equal more than the original IVA do not seem to be appropriate. Is that legal?
Sara (Debt Camel) says
Ask them for a breakdown of how that has been calaulated.
Kevin says
I have been contacted by my iva firm, that because my IVA was completed in 2010 that most of my creditors didn’t collect so there’s a large surplus for me to now, and legally I can have back, is this correct?
Sara (Debt Camel) says
Yes it probably is.
It is always possible – but very unusual – for someone to get a cheque after their IVA has finished as a creditor didn’t claim the money they were owed
But in this case, where the IVA firm is trying to contact creditors about an ancient IVA, it is much more likely that the creditor swill simly have no records of you or the IVA any more and so they have no idea what the IVA firm is talking about. the IVA firm can’t keep this money so it has to go back to you. Unfortunately the IVA firm will have decuted its large fees – this is why they have been going through the PPI reclaim process. But you should get money back.
If they send you a cheque, fine. Of course if they are asking for your bank details, do be sure you are being contacted by the IVA firm, not a scammer… it’s probably fine but better safe than sorry.
anthony ryan says
I finnished my iva 8 years ago low and behold last year the Royal Bank of Scotland informed me I was entitled to a ppi repayment,seeing i was informed by debt free direct after 5 years have past your iva was finnished no claw backs anything you get is yours (ppi)but not the case.so anything comes through the post dont get signed in future,as I stated to one of dfd rep they can continue to rip you off till up untill you die
Nathalie says
Hi Sara,
My IVA has completed and I’ve been asked to sign paperwork to permit my creditors to have any PPI any payments due after completion. I think I claimed PPI either before or start of my IVA. Does this count or is it only after completion?
Sara (Debt Camel) says
Have you already been paid the PPI refund?
Nathalie says
Yes I think so. A company claimed for me so they took a percent of it. I have no idea how much was paid though.
Sara (Debt Camel) says
If your refund was before the IVA then it is irrelevant. If it was during the IVA , you should have told your IVA firm.
It sounds as though you are being asked to sign something that relkates to payments you have not yet received… if you aren’t sure, talk to your local Citizens Advice and they will look at it for you.
Ms Vx says
I completed my IVA 6 years ago.
My original debt to creditors was £40000. Over a 6 year period I paid a total of £34,000 (£475 per month).
I was subsequently contacted by my IVA trust 3 years ago to say they had appointed a claims management company to pursue old PPI claims. Any recovered claims would still go into my IVA estate but as a goodwill gesture the iVA trustees would pay me any recovered statutory interest minus costs.
I have just heard from an old creditor that I have a successful case of £16,000. Of this total amount approximately £9000 is the gross interest calculation. Will I be entitled to now receive this £9000?
I also remember that when my iVA was still active, there was a PPI claim from another creditor which also went into my IVA. This was around £14,000. Am I entitled to claim for the statutory interest on that historic payment even though that went straight into my IVA estate at the time ?
Considering my original debt of £40000, the payments I have personally made of £34000, the historic IVA payment of £14,000 and now this new PPI claim of £16000, this means over £64000 will have been paid into my IVA estate. This is £24,000 more than my original debt. I am fully aware that costs are involved in administering an IVA, but surely I will be entitled to something back.
Can you please help.
Thanks
Sara (Debt Camel) says
Any recovered statutory interest minus costs.
This normally means they will deduct the claims management companies high fees and sometimes a charge they make. But from 9k I would hope you should get at the very least 3k back.
You can also ask your IVA firm to produce an account showing whether your IVA has yet been paid “in full” yet.
Ruth Swann says
Hi . I’m at the end of my iva . They want me to sign a form allowing them ppi . But they have already had the ppi I accrued. I know there is no more .
So if I sign this form does this mean any ppi from now into the future will be theirs?
Sara (Debt Camel) says
yes. But why do you care if you know there isn’t any more?
And if you don’t sign they can just hold up completing the IVA until they are satisfied there are no further amounts that could be collected – do you want to wait another year or two?
Jo P says
MrsP
Are the PPI company and the bank I am claiming PPI from legally allowed to liaise with each other regarding my IVA which was paid off in 2005? Not sure I want the PPI company to know much about the IVA.
Thanks.
Sara (Debt Camel) says
does the PPI relate to debt before your IVA?
JoP says
Hi, yes it does.
Sara (Debt Camel) says
Then the PPI refund should probably be paid to your IVA firm
Joanne Plant says
Ok, thanks for your help.
CG says
I had an R3 IVA and it was completed (with certificate) in Jan 2018. Due to the R3 wording, I have had all of my PPI / mis sold claims since that date continue to be claimed in full by the IVA managers to go towards any outstanding costs / debts claimed on the IVA.
During the IVA I was mis-sold a SIPP pension plan. I subsequently made a claim and the compensation of £13,513.83 was awarded, which was taken by the IVA managers and paid to the IVA creditors. There was a further investigation by the Financial Services Compensation Scheme (FSCS) and they awarded the value of the pension: a further £16,166.41, which the IVA managers have taken and claim must be paid to the creditors. They have yet to do so, due to an outstanding complaint.
I accepted the loss of the compensation to the IVA, but I do not accept the loss of the pension funds, not least because there is inconsistency across different IVA managers on whether it is covered by the R3 wording. The IVA managers justified their claim by stating that even though the amount of the award corresponds to the quantum of pension contributions, that they are not pension funds.
Thoughts welcome.
Sara (Debt Camel) says
how large were the debts that went into your IVA? How much did you pay in yourself to the IVA?
CG says
In round numbers, the whole IVA originally agreed was £50k, with £10k paid back before it finished/formally completed.
£15k of other claims have since been paid through PPI / mis sold claims since the end of the IVA (due to the R3 terms).
Sara (Debt Camel) says
ok so I cannot give you legal advice on this. Yoy may be able to argue that these funds are effectively pension funds and so should not be claimed. I do not know and am not going to guess. I can give you details of a solicitor if you do not have one, but this may well lead to charges.
You can also make a complaint to the IP named on your IVA saying they are being unreasonable.
I do not know if you can insist on a variation being put to your creditors saying that these pension funds should not be claimed on the fgrounds of fairness. I haven’t come across a variation after an IVA completion. Again a solicitor can advice on this.
CG says
Thanks.
I made a formal complaint to the IP saying that they are being unreasonable. I also argued that pension funds may also qualify as exempt from consideration under section 283(2) of the Insolvency Act 1986 (such provisions necessary for satisfying basic domestic needs of the bankrupt) as they are not specifically excluded under section 308 of the same act, but the complaint was wholly rejected.
I have had input from a pensions claims advisor (which is where I got the information about the inconsistency of IP approaches on use of pension funds). According to the IP, I cannot request any appeal to the IVA creditors, as the ability to do so stopped when the IVA completed.
My last stop is the Ombudsman.
Sara (Debt Camel) says
The Financial Ombudsman? They cannot take a complaint about an IVA.
You can take your IP complaint to the IP’s professional body – usually the IPA or ICAEW. But I don’t have much faith in a good decision from them
I think you need to decide if it worth talking to a solicitor.
CG says
Apologies, I meant making a complaint to the Insolvency Service.
Sara (Debt Camel) says
ok.
Sara (Debt Camel) says
This is a technical legal article looking at the issue of pension claims and IVAs – https://r1.dotdigital-pages.com/p/133C-R4U/surviving-iva-trusts-the-ongoing-saga. I am not sure it is much help, but it does show that the issue is a live one, not just for you.
Darren says
I took out payday loans whilst in an iva, not
Before. The iva closed 4 years ago, are they entitled to the refund that I am getting for them for them not checking I could afford the loans?
Sara (Debt Camel) says
who were the payday lenders?
Darren says
Quick quid
Sara (Debt Camel) says
ok, yes the IVA firm may well be entitled to a refund, but some IVA firms don’t bother with this. Whether the QQ administrators will do the work to send this to your IVA firm not to you, I can’t guess. If they don’t and the refund comes to you, well in theory you should contact your IVA firm and ask them about this.
Darren says
Ok thank you, it’s the same firm carrying out the insolvency as was my iva with so I would imagine they wouldn’t pay it to me, just wondered where I stand
simon says
I have received a text message from DMUK stating I’m due a refund of 1500. They’ve sent a cheque to an old address so could I notify them of my new address?They are called Aperture which used to be grant Thornton. I had an Iva with them in 2008 but never completed as I went bankrupt in 2010. Obviously I’m worried that this may be a scam. Any comments?
Sara (Debt Camel) says
DMUK could, I suppose, be Debt Movement. That is the firm that bought all open cases from Aperture a few years ago – it was called Jarvis at the time but rebranded to Debt Movement. I wasn’t aware that they were sorting out problems with very old IVA cases.
There are a few ways that you could be owed money, but £1500 seems quite a lot.
If you want to check up whether this is a scam, I suggest you call Debt Movement directly on 0330 380 1707. Do not use any link or phone number suggested in that text. This is always the safest way to find out if a text is a scam.
On the other hand you may decide not to bother as if the money does come to you, you should inform the Official Receiver’s office for your bankruptcy as it will probably be claimed by them.
Sara (Debt Camel) says
So a follow up as there is now a page on the Debt Movement website which may refer to this: https://debtmovement.co.uk/post-iva-trusts – there website was down yesterday, this page may be new.
This makes it more likely – but not definite – that the contact did come from Debt Movement. My suggestion to conyact Debt Movement direct is still sensible. But you can now email them on ivatrusts@debtmovement.co.uk about this rather than phone.