I have today received a response from the Solicitors Regulation Authority, which I show below. It appears that they visited Restons office and were satisfied that seeing Restons appeared to have billed the bank separately to the “collection charge” there is no contingency fee arrangement. This explains why HSBC have been saying the collection charge is not to pay the solicitors costs.Clearly Restons and the bank have colluded in this wheeze to avoid the charge of illegality.

But of course it is a contingency fee. I have seen the contract Restons has with the bank – the charge is 16.4% which is 14% plus 17.5% VAT. If Restons were billing the bank separately from that percentage then it was almost certainly VAT fraud as they/the bank were charging the debtor VAT on a percentage of the debt. I’m sure the SRA will not have seen any invoices paid by the bank on debts which were not paid.

This is becoming more complicated but even clearer to me – Restons have misled the SRA.