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Hello Legal Beagles,
I need advice regarding five credit card accounts originally issued by NewDay and now managed by Cabot Financial. There are discrepancies in the spelling of my surname across four of the five agreements. Cabot has admitted that one account is unenforceable, but NewDay has rejected my complaint. I currently receive Universal Credit, which may be relevant for potential legal aid eligibility.
Case Timeline
Key Fact: All five accounts were opened within a three-week period in February 2021. Key Issues
1️⃣ Systemic Name Discrepancies:
2️⃣ Unaffordable Lending (FCA Breach):
3️⃣ CCA s.61 Breach:
4️⃣ NewDay's Flawed Defence:
1️⃣ Should I escalate all accounts to the Financial Ombudsman Service (FOS) now, citing FCA breaches and potential unenforceability under the CCA? Or should I send CCA requests for the remaining four accounts first?
2️⃣ How do I counter NewDay's claim that I caused the error by "signing with the wrong name"?
3️⃣ Can I demand removal of adverse entries from my credit file due to unenforceable?
4️⃣ Has anyone successfully challenged NewDay or Cabot Financial over similar issues involving name discrepancies or rapid issuance of multiple accounts?
5️⃣ Given that I'm in receipt of Universal Credit, what free legal resources might be available to me if I need to pursue this further? Additional Context:
These errors have caused me significant distress and confusion about managing these accounts, especially given how quickly they were opened and subsequently defaulted. My credit file has been negatively impacted as a result of these defaults, which I believe could have been avoided if NewDay had conducted proper checks before issuing this level of credit. I was diagnosed with mixed anxiety/depressive disorder in the Summer of that year (2021).
Cabot's limited involvement in addressing the core issues (by referring the complaint back to NewDay) also raises questions about their role in this process.
Thank you in advance for any insights or advice.
echat11
I need advice regarding five credit card accounts originally issued by NewDay and now managed by Cabot Financial. There are discrepancies in the spelling of my surname across four of the five agreements. Cabot has admitted that one account is unenforceable, but NewDay has rejected my complaint. I currently receive Universal Credit, which may be relevant for potential legal aid eligibility.
Case Timeline
- CCA Request for One Account: I requested a copy of the credit agreement for one account and found that my surname was misspelled. This is the only CCA request I've made so far. I don't think I asked for the Default Notice or Notice of Assignment either at the time of the CCA request.
- Cabot's Response: Cabot acknowledged that this debt is unenforceable and stated they would not pursue court action. They then referred my complaint back to NewDay for investigation.
- NewDay's Rejection: NewDay responded directly to my complaint, stating: "The name you provided... was linked to the address... You signed the credit agreement with the incorrect name... no evidence of a NewDay error."
- Account 1: Opened in early 2021; defaulted in late 2021; balance ~£1,200
- Account 2 : Opened in early 2021; defaulted in late 2021; balance ~£300
- Account 3: Opened in early 2021; defaulted in late 2021; balance ~£1,000
- Account 4: Opened in early 2021; defaulted in early 2022; balance ~£500
- Account 5: Opened in early 2021; defaulted in early 2022; balance ~£1,100
Key Fact: All five accounts were opened within a three-week period in February 2021. Key Issues
1️⃣ Systemic Name Discrepancies:
- My surname is spelled differently across four agreements, with only one account having the correct spelling.
- NewDay admits I "signed with the incorrect name" but claims no error on their part. How did they accept agreements with mismatched names?
- Each credit agreement must've had to have passed a credit check. How could NewDay's processes have allowed for an application with the incorrect details to pass basic checks?
2️⃣ Unaffordable Lending (FCA Breach):
- All five accounts were opened within a three-week period in February 2021. This rapid issuance raises serious questions about NewDay's credit assessment process.
- Four accounts defaulted within a month of each other (December 2021–January 2022). This suggests a failure to conduct proper affordability checks as required under FCA CONC 13.1.3R.
3️⃣ CCA s.61 Breach:
- Agreements may be improperly executed due to inaccurate party identification (incorrect surname), potentially rendering them unenforceable under s.127 of the Consumer Credit Act 1974.
4️⃣ NewDay's Flawed Defence:
- Their claim that identity checks were done via "name linked to address" ignores FCA rules requiring full name verification and proper execution of agreements.
- Legal Arguments
- Harrison v Link Financial (2013): Minor name errors invalidate agreements if ambiguity exists about the parties' identities.
- Carey v HSBC (2009): Creditors must maintain accurate records – repeated errors suggest systemic failings by NewDay.
- FCA CONC 2.1B: NewDay's actions likely breached "treating customers fairly" rules by issuing multiple accounts without adequate checks.
1️⃣ Should I escalate all accounts to the Financial Ombudsman Service (FOS) now, citing FCA breaches and potential unenforceability under the CCA? Or should I send CCA requests for the remaining four accounts first?
2️⃣ How do I counter NewDay's claim that I caused the error by "signing with the wrong name"?
3️⃣ Can I demand removal of adverse entries from my credit file due to unenforceable?
4️⃣ Has anyone successfully challenged NewDay or Cabot Financial over similar issues involving name discrepancies or rapid issuance of multiple accounts?
5️⃣ Given that I'm in receipt of Universal Credit, what free legal resources might be available to me if I need to pursue this further? Additional Context:
These errors have caused me significant distress and confusion about managing these accounts, especially given how quickly they were opened and subsequently defaulted. My credit file has been negatively impacted as a result of these defaults, which I believe could have been avoided if NewDay had conducted proper checks before issuing this level of credit. I was diagnosed with mixed anxiety/depressive disorder in the Summer of that year (2021).
Cabot's limited involvement in addressing the core issues (by referring the complaint back to NewDay) also raises questions about their role in this process.
Thank you in advance for any insights or advice.
echat11
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