Bank charges reclaim offset against debt help!

[cbatten565]

hi, just wondering if anyone can provide guidance here... the situation is is that I owe a debt to Cabot financial for an old Santander account. I managed to get a substantial discount after getting them to prove the debt etc and a lot of toing and throwing. Anyway, I recently read an article from Martin Lewis surrounding reclaiming excessive bank charges so I rang Santander and they compensated me £300 worth of charges but they say it will be offset against the balance that was owed when the account defaulted and sold to Cabot. Potentially, they say the money will be sent to Cabot but can they legally do this, as I have proof that they sold this by way of notice of assignment, so legally Cabot have no entitlement to that money. Am I correct in my thinking?? Please can someone provide some guidance?