Now that the Financial Conduct Authority has agreed to reconsider their decision to take no action on my report of HSBC fraud I thought I would set out simply why the charges were fraudulent and should be repaid.
It is unlawful for solicitors to write to an opponent claiming costs not properly due or to take advantage of someone’s ignorance of the law. The two solicitors firms involved wrote a “letter before action” to debtors claiming an additional 16.4% of the debt due for costs (14% + VAT at 17.5%),in some cases as much as £5,000 before they had even done any work. This is from the Solicitors Code of Conduct:
The charges were also unlawful contingency fees (meaning that the solicitors retained 16.4% of any monies recovered for their costs; if none were recovered they didn’t get paid) as ruled by the Solicitors Regulation Authority:
There was no provision in the Consumer Credit Agreements for the charges and the bank was ordered by the Office of Fair Trading to cease adding them unless they changed their agreements:
Finally the charges were fraudulent for every one of the three reasons set out in the Fraud Act I have estimated that over the years of the fraud at least £1bn has been added to the debts of between 5-600,000 consumers. The should be compensated.