Compass debt company

[Wingco]

Re: Compass debt company

Thanks Exc - that sounds very similar if not identical. Barclays and World Pay support my comments about not taking action too soon. I can't say more than that but I'm sure you know what I 'm alluding to.

Dividends were allegedly paid out after they must have known they were in trouble. My accountant rightly jumped on me when I took slightly more in dividends than I had in profits - I had to sort it out fairly promptly - so why are their accountants not liable too? Mine told me that unless I resolved the account, he could no longer work for me - and he's a friend. Can the accountants be held responsible? Probably not, but there is something very fishy with the Compass accounts - I'm sure the liquidator will get to the bottom of it all - what a horrible job, but it pays well.

[charitynjw]

Re: Compass debt company

I don't know whether this is of use?

http://www.mln.org.uk/siteFiles/reso...0liability.pdf

[Wingco]

Re: Compass debt company

There were plenty of people who were getting statements from Compass showing payments made to creditors but 6 years later they were being told that no payments had been made. One woman had 2 accounts that apparently had been ignored by Compass for 8 years and only discovered this when she contacted all of her creditors. She then started paying them - you just wouldn't believe it. But she didn't want to leave debt for her children and just wanted to be honourable and pay it back I understand the SB rules and the people I spoke to had not had any contact or payments to one or 2 of their creditors for over 6 years. I very much doubt Compass had either and were probably playing the odds they would be ignored - one of her monthly payments was £2 per month but it just wasn't going out to the creditor.

You could write a book about most of the cases I heard there - a police woman who was told, I believe face-to-face by one or 2 of the directors that all was well and the creditors couldn't put a charge on her house; they did, whilst she was pregnant - she was very distressed. She could now lose her job and her house. She had little money to get through to her next pay day and asked some very blunt and challenging questions to the Directors.
She told one irate father at the meeting representing his daughter to withdraw a direct physical threat to the directors - he changed his wording........slightly. But the other policeman Compass client was about to arrest him - exciting stuff. Another got up during the report reading, swore atrociously at the Directors using the C word, and stormed out. He was the first to leave - a couple of others slipped out early.

Also the young lad with the £400 escalating with PDLs and other loans, I really don't have much detail on. But he got no help from Compass and I really agree with his mother that some of his loans were sold to someone under 18, unemployed and therefore he could rightly contest them - is that correct?
Wingco

[Wingco]

Re: Compass debt company

There were lots of "We don't know" answers at the liquidator's meeting. How many clients are there: "We don't know". Where has all of the clients' £1M+ gone?: "We don't know" Did you read the accounts or just sign them? "I don't know". How was the money allocated to the clients' account?: "We don't know." Interestingly, at this point one of the more apologetic Directors seemed to blame Bob Solloway, who shook his head. Why do the 2013 and 2014 accounts have this large discrepancy?: "We don't know."

Even when they were asked when they knew the game was up Bob Solloway corrected the date given in the report.

You can imagine the response of the audience to this type of answer. But I tend to believe they had very little idea or knowledge of precisely what was going on. They weren't even sure of their 2015 dividend payments when they weren't operating in profit, but perhaps that would be incriminating. Perhaps they were hoping for a Ponzi type money feeding future, but in 2014 they were stopped from taking on any more new clients by the FCA, I believe. (Sorry, my report sheet was removed by somebody at the meeting.) I was taken on (in) in February 2014.
Wingco

[Wingco]

Re: Compass debt company

I knew I could rely on you - hope you are smiling?:tongue2:

[Wingco]

Re: Compass debt company

This post refers to Nibbler's question about 4 posts back - not sure why it has gone in out of context - probably my finger trouble!!!

1. 1000+
2. Nil - there is no pot. Never was and the contract doesn't even say there is a pot - a Compass myth largely supported by a balance at the bottom of the clients' statements. It was also mentioned by the ("overpaid") salespeople when calculating your monthly payment, i.e, You can afford £300 per month, we will pay £150 to your creditors and £150 to Compass. After a while you will start building a pot which will be used to arrange Full & Final Settlements with your creditors. We aim to have you debt free in 4-5 years, but with your level of debt, it will take about 8-10 years."
3. Yes, it's a rough estimate and I think it is 2-3 times that as nearly everybody I spoke to was 'owed' around £7,000 in their mythical pot, there were 3 people with over £30,000 and quite a few with £10-15,000 nearing the end of some very long plans. Most appeared to have paid out more than their debt and yet their debts were still at or near their original debt - depressing and disgraceful.

[EXC]

Re: Compass debt company

1. There is no doubt the directors have been trading illegally and possibly since 2011 when HMRC initiated an investigation into company cars & dividend payment "not from profit" which I understand is a breach of company law.

That's interesting. There was a recent judgment against Carl Wright who ran the notorious Cartel Client Review who scammed thousands of people for upfront fees (PPI claims and debt write offs) before going into administration. Some big creditors which included Barclays & World Pay replaced the administrators with their own and took the company out of liquidation so that the company could sieze some of Wright's personal assets.

The judgment was largely about Wright awarding himself bonuses (£1.5m) shortly before the company failed. The judge ruled that as the dividends didn't come from profits but from upfront fee deposits the funds were unlawfully awarded. So it sounds similar to this.

Judgment attached, it's an interesting read.

[Amethyst]

Re: Compass debt company

Thanks Wingoco that's really helpful.

One interesting aspect that came out was that many of the clients had Statutory Barred debts, had payday loans, had mis-sold loans and some were paying far too much back and suffering as a result.
One young lad with his mother had started with a £400 mobile phone bill and it had grown to over £12,000. I didn't get the detail but advised him to seek help in unravelling his debts and then to promise me that he would learn from the horrendous stories we heard from the Compass Clients and not be as stupid as me. He seemed so nice and his mother was very supportive - he is young enough to get over this, but I told him not to rush - I hope he comes on here and we can help him further - but why didn't Compass Debt COUNSELLING? Surely, this is what they should have been doing.
Wingco

Compass weren't counsellors at all, just wanted your money - look at what happened with your debts - yes you had breathing space, but out of £300 disposable income each month, you only had £80 going to creditors - where was the rest going ? fees... I don't think anything on yours was going to a pot was it? It will be hard work getting your up to date info off the creditors and I have a feeling there's going to be some tough choices needed to be made.

Actually Reading through your agreement there is a section that states ''if you receive any county court paperwork forward it to compass head office immediately' - I wonder if anyone did do that and what the outcome was ? or if it was just left and they now have a CCJ and £50 repayment - I think people should be checking on Trust Online and examining their credit files as well as trying to get up to date statements off of their creditors.

Unlikely debts with be statute barred if Compass were paying token amounts to creditors or in contact with them at all as that would keep resetting the clock.

Payday and missold loans would need to be looked at separately.

This guy with the £400 mobile phone bill - to grow to £12k would be insane, so one can only assume he tried to pay it off using a PDL and that kept rolling over and growing, one thing piling on top of another. That definately wants looking at anyway.

[taff_dragoness]

Re: Compass debt company

Thank you Wingco for your report,alot of info to take in. I hope between this site and the facebook page we can all have somewhere to go. I for one am so great full for you all that one day a few weeks ago i thought that was it but posting on her was a god send. Not out of the woods by a long way if anything right back at the beginning, but with stepchange i can get going again, and maybe if anything does come back it will finish sooner, but being realistic. So will wait and see what the next plan of action is ( Up the survivors )

[Nibbler]

Re: Compass debt company

Thank you for that update Wingco.

Not good news, but at least we know a lot more now than we did.

[Nibbler]

Re: Compass debt company

there seemed to be a huge reliance on others to take on their burden; very understandable but I said come to Legal Beagles and Nibbler would do it all for them I did encourage them to seek advice from Legal Beagles but to read the full threads first - don't just dive in and expect no-one else has asked your question before. I advised using the templates and taking on board the advice but the site encourages debtors to pay their debts and not avoid them. Most will probably use the FREE DMCs.

Ummmmmmmm..............

Thanks.

:lol:

[Wingco]

Re: Compass debt company

One interesting aspect that came out was that many of the clients had Statutory Barred debts, had payday loans, had mis-sold loans and some were paying far too much back and suffering as a result.
One young lad with his mother had started with a £400 mobile phone bill and it had grown to over £12,000. I didn't get the detail but advised him to seek help in unravelling his debts and then to promise me that he would learn from the horrendous stories we heard from the Compass Clients and not be as stupid as me. He seemed so nice and his mother was very supportive - he is young enough to get over this, but I told him not to rush - I hope he comes on here and we can help him further - but why didn't Compass Debt COUNSELLING? Surely, this is what they should have been doing.
Wingco

[Wingco]

Re: Compass debt company

The info posted so far is largely correct. I will add some more:

1. There is no doubt the directors have been trading illegally and possibly since 2011 when HMRC initiated an investigation into company cars & dividend payment "not from profit" which I understand is a breach of company law.

2. There are a few other 'discrepancies' that need further investigation; the 2013 and 2014 accounts were compiled by different accounting firms but the figures don't match up - the Directors signed them off and they are wrong.

3. The Barclays bank transfer of the massive clients' account (£22K approx. when it should be at least £2M and I think it should be over £3M) was, I believe) transferred to an overdrawn account to cover the overdraft. This use of the clients' fund is wrong and Barclays will have to repay the amount but it is a p$%s in the ocean.

4. The committee was given a very credible reason not to take Action Fraud reporting just yet. I cannot divulge the reason here as it was confidential but it would appear to be the only way to get anything out of Compass. I know Amethyst and Nibbler disagree and think it is a ploy by the liquidator to earn more money; whilst it is true he would earn more if this money is achieved, without it, NOBODY is likely to get anything back perhaps for years or ever. This is not to say that no Action Fraud reporting will be done as individuals are free to do whatever they want, but the likely result is that no liquidator would take on the Compass liquidation afterwards and we would be left to the Government liquidators who are snowed under and work exceedingly slowly. I happen to have changed my mind about this now knowing the reason and at the very least we should allow the liquidator to do his best for a while; the committee of 5 will monitor this but we can't account for the weight of opinion in the room. Individuals have already complained to the FCA and the Police/Action Fraud, so it may have been taken out of our hands already. It is not our job to stop people doing what they think is right. just wish they would let us follow the Liquidator's advice, and there is a liquidator/tax professional on the committee.

5. The Committee consists of the Liquidator/Tax specialist, a compliance officer (sorry Andy if I have got that wrong but he advises on professional qualifications (?). He is also very bright and proactive. There are 2 Company Directors plus one other guy who got involved in the meeting.

6. We need to collect as many email addresses of Compass clients in order to set up an information network - Andy is going to arrange an email address dedicated to this.

7. The atmosphere at the meeting was very aggressive, people kept interrupting the liquidator, some arrived late and repeated questions already answered - so annoying. And as I feared, many attempted to get answers to impossible questions that were well outside the remit of this meeting and/or to tell their own stories. It did have the effect of shaming the directors more and 2 of them apologised openly, the other spent a lot of the time with his head down and he was challenged to look us in the eyes. It was very uncomfortable for them, and rightly so. But the swearing was not welcomed. The Directors agreed to forego their pay and dividends which amounted to about £80,000 - good of them!!! - I don't have the exact figures as my report sheets were collected by someone who came in late! I'll get another copy and report more precisely on the accounts although others will have the official report and can help sooner.

8. About half the room had gone to Abbey Solicitors. One woman said "Because Compass advised her to do this"!!!!! One Director explained why but I advised everyone to cancel their arrangement, tell their banks that they want their subscriptions back as some of Abbey's claims were false. I explained what 'unenforceable' means and it was pointed out to them that they can do that themselves for a £1 (CCA letters). But they would still owe the original debt, without payment for a year, their creditors would come after them and Abbey would be unable to help them. there seemed to be a huge reliance on others to take on their burden; very understandable but I said come to Legal Beagles and Nibbler would do it all for them I did encourage them to seek advice from Legal Beagles but to read the full threads first - don't just dive in and expect no-one else has asked your question before. I advised using the templates and taking on board the advice but the site encourages debtors to pay their debts and not avoid them. Most will probably use the FREE DMCs.

9. The meeting was very open; you got the feeling anyone could have walked in without being a client. There were a number of people there who were representing other people but it would have been better to see their proxy forms as there was an element of voting - they could have been anybody or even friends of Compass. There FREE drinks - and so there should be!

9. It was made clear that AABRS will find it difficult to handle the thousands of emails coming in from clients; hopefully we can devise a way of mitigating this to some extent. I also met one disabled guy who doesn't own a computer and would know how to work one - no emails, and uses snail mail to communicate: do you remember letters and stamps, Amethyst? This guy came out with the quote of the day: "I've raised myself from total destitution to abject poverty."

10. The main outcomes were that there is very little money in the pot (£22K = £11-£22 per creditor), there are between 1000 and 2000 clients (not 500), Compass has been in trouble for quite some time and probably the directors have known of the problems for many months - one guy was told back in early December 2015, so why weren't we all? The Directors looked like broken men, and that is the likely outcome but not in the near future.

I'm bound to think of more - it was a very long meeting.
Wingco

[Nibbler]

Re: Compass debt company

From MSE thread

So I was at the meeting, Am owed around £5000.

It would seem the only monies to be refunded, as alluded to by CLS2015, are those that the Directors are not to claim their owings.
Mark J Harrison was listed as a creditor for £2063,Richard Mott £33,769 and Richard Solloway £24973.

In the meeting they all retracted their claim.

It would seem from the Liquidators calculations around £1,5 to 2Million is potentially owed to, well, us.

However, he did say from the few agreements he has seen, no one actually signed for a 'ring fenced pot'

It would seem that the Directors 3 had been taking yearly £430k between them in dividends (which they were quick to point out had been taxed upon rather heavily).

When asked where the money was, The Directors 3 could only shuffle and say 'that's why we have asked to appoint the liquidators because we don't know'

The client pot stood at a maximum of £22k and this was moved (wrongly) to a VAT pot by their bank.

Make of it what you will.

A committee has been created, one of which is Himself a liquidator for another company.


Gilltheblackcat.

[Nibbler]

Re: Compass debt company

So not 500 clients as previously claimed?

Wonder what numbers were for-

- active clients on a DMP?
- out of those number with a pot?
- is the £2m just the pot money missing? O