DAS reviews

DAS review summaries - Quarter 1 - 2021/2022

Case 1 - Variation

Total debt: £17,500.
DPP term: 9 years.
Application for a payment break variation submitted as client’s income had reduced due to the Covid pandemic.
Two creditors, owed 61% of the total debt, objected to the payment break as the client had already had two consecutive payment breaks and approval of a further break variation would mean creditors not receiving a payment for a total of 18 months.
The DAS Administrator rejected the payment break variation so a full review of client’s circumstance could be undertaken.
The Money Adviser (MA) requested a review of the decision to reject the variation.
The Reviewing Officer noted the client’s income had reduced to ‘Nil’, as a result of not being able to work due to the Covid pandemic. It was noted that, whilst creditors had not received payments for some time, the client had made all required payments as they became due and had not breached any DPP standard condition.
The MA suggested that as Covid lockdown restrictions eased, their client should be in a position to recommence payments towards their DAS DPP.
The Reviewing Officer overturned the decision to reject the payment break variation on the grounds that this break was only required due to what is expected to be, a temporary reduction in the client’s income and the client had been complying with the conditions of their debt payment programme (DPP).
The Reviewing Officer informed the client they must immediately inform their MA of any change in their financial circumstances that will allow payments to recommence.

Case 2 - Revocation

Total debt: £45,000
DPP term: 10 years
A creditor submitted a revocation proposal on the grounds that the client was not making payments towards their DPP and was not paying a current liability.
The DAS Administrator approved the proposal and the client’s DPP was revoked.
The Money Adviser (MA) on behalf of the client, asked for a review of the decision to revoke the DPP.
The Review Officer did not receive any further representation regarding the revocation action.
The Reviewing Officer noted that the client had not made any required payment towards their DPP for 14 months, nor responded to the revocation proposal letter.
The Reviewing Office received information that the client had indicated to their MA they were disillusioned with their DPP.
The Reviewing Officer was satisfied the client had failed, without reasonable excuse, to comply with two standard conditions of their DPP and confirmed the DAS Administrator’s decision and the DPP was revoked.

Case 3 - Variation

Total debt: £112,000
DPP term: 12 years
The Money Adviser (MA) asked for a review of the DAS Administrator’s decision to reject a proposal to vary their client’s DPP.
The Review Officer did not receive any further representation regarding the variation rejection.
The Reviewing Officer looked in detail at the request for variation and considered the points made regarding the client’s personal circumstances.
The client’s financial situation was no longer the same as when the DPP was approved and they were now in deficit with regards to the declared level of expenditure against their new income figures.
The Reviewing Officer concluded, from the evidence provided, it was unlikely the proposed varied DPP would be successful going forward as the client did not have sufficient surplus income to maintain the proposed varied DPP payment amounts. The decision to reject the variation was confirmed.

Case 4 - Revocation

Total debt: £117,500.
DPP term: 6 years.
A creditor asked for the DPP to be revoked because the client was not paying a continuing liability and they were now in significant arrears.
The DAS Administrator considered the request and noted that the client had not made every payment to his DPP when it became due. The DPP was revoked.
The client asked for a review of the decision to revoke the DPP.
They claimed there were no arrears of his current liability and he had not received the letter from the DAS Administrator proposing to revoke his DPP.
The Reviewing Officer contacted the creditor who provided proof that a current liability remained unpaid.
It was also noted that the client had missed payments to his DPP and not provided an explanation for this.
The DAS Administrator’s decision was confirmed and the DPP was revoked.

Case 5 - Revocation

Total debt: £65,000.
DPP term: 7 years.
A creditor asked for the DPP to be revoked on the basis that they had not received a payment for 15 months.
The DAS Administrator wrote to the client asking for him to provide reasonable cause for the missed payments. No response was received.
The DAS Administrator acknowledged that the client did have a payment break in place due to the current pandemic but this ended 11 months ago and his DPP payments had not restarted.
The DAS Administrator revoked the DPP.
The client asked for a review of that decision.
The Reviewing Officer noted the volume of missed payments. The client did not provide reasonable cause for missing the payments and made no proposal or guarantee that he was committed, or in a position, to continue with his DPP.
The Reviewing Officer agreed with the original decision and the DPP was revoked.

Case 6 - Approval

Total debt: £89,000.
DPP term: 13 years.
Four creditors objected to the DPP being approved. The proposal was considered under the fair and reasonable test.
After consideration of all factors, the DAS Administrator approved the DPP.
A creditor asked for a review of that decision on the basis the client had failed to submit tax returns and his income was more than was declared in his DPP proposal.
The Reviewing Officer asked the client’s Money Adviser (MA) to supply evidence of income over the previous few months and to explain why a creditor was being paid separately from the DPP.
The requested information was not provided by the deadline given by the Reviewing Officer.
The Reviewing Officer revoked the DAS Administrator’s decision and the DPP was not approved, because not all of the client’s debts had been included in the DPP and satisfactory evidence of the client’s income had not been provided.

Case 7 – Revocation

Total debt: £22,000
DPP Term: 8 years
A creditor asked for the DPP to be revoked on the basis the client had not made the first payment to the DPP within 42 days of the date of its approval.
The DAS Administrator wrote to the client asking for him to provide reasonable cause for the missed payments. No response was received.
The DAS Administrator revoked the DPP.
The Money Adviser (MA), on behalf of the client asked for a review of the decision to revoke the DPP.
The Reviewing Officer contacted a creditor who confirmed a wages’ arrestment that had remained in place after the DPP was approved, had now been cancelled. No information about this arrestment had been noted by the DAS Administrator.
The Reviewing Officer overturned the decision to revoke the DPP because the reason the initial payments could not be paid, had been removed and there was no reason to prevent the client from commencing and maintaining payments to the DPP.

Case 8 – Revocation

Total debt: £98,000
DPP Term: 19 years
A creditor asked for the DPP to be revoked on the basis that the client was not making payments to their DPP.
The DAS Administrator wrote to the client asking for him to provide reasonable cause for the missed payments. No response was received.
The DAS Administrator acknowledged that a number of instalments had been paid for amounts larger than the approved DPP contribution amount. This meant the DPP was in arrears of approximately eight payments.
The DAS Administrator agreed that the DPP should be revoked.
The client asked for a review of that decision.
He stated his employment was terminated through no fault of my own and he wasn’t informed he could extend the payment break. He advised he had recently started new employment and would soon be in a position to restart payments.
The Reviewing Officer noted the client signed a payment break application in which agreed he would contact his Money Adviser for further advice when the payment break ended. It was also noted the client’s income from new employment was reduced and no CFT calculation had been done that evidenced he could still pay the required DPP contributions.
The Reviewing Officer was not satisfied the DPP was now sustainable and agreed the original decision. The DPP was revoked.

Case 9 – Revocation

Total debt: £40,000
DPP Term: 11 years
The DAS Administrator asked for the DPP to be revoked on the basis that the client was not making payments and failed without reasonable cause to satisfy a discretionary condition imposed under Regulation 28 of the DAS Regs.
The DAS Administrator noted the client’s reasons why the discretionary condition could not be met, and a note from their Money Adviser (MA) stating the client could only afford a reduced payment.
The DAS Administrator decided the DPP should be revoked.
The client asked for a review of that decision.
The Reviewing Officer noted additional information provided in the review request, about a change in income and a personal family reason for failing to meet standard conditions of the DPP. However, it was also noted that the client had sufficient opportunity to engage with the MA prior to the revocation action commencing.
The Reviewing Officer agreed with the original decision because the client could not satisfy they could comply with the conditions of their DPP. The DPP was revoked.

Case 10 – Revocation

Total debt: £42,000
DPP Term: 13 years
The DAS Administrator asked for the DPP to be revoked on the basis that the client failed without reasonable cause to comply with their DPP discretionary condition, as required under Regulation 28 of the DAS Regs.
The DAS Administrator asked the client to explain the failure to increase their DPP instalment amount, as required under the discretionary condition. No response was received.
The DAS Administrator revoked the DPP.
The client asked for a review of that decision.
The client stated that she thought her DPP direct debit payments would be increased automatically.
The client’s Money Adviser (MA) confirmed several emails and a letter had been sent to the client regarding the discretionary condition. Several emails had not been received due to the client changing email address.
The Reviewing Officer was not satisfied with the explanation for not complying with the discretionary condition and as the client had not complied with one of the standard conditions of the DPP, the DAS Administrator’s decision was upheld and the DPP was revoked.

Case 11 - Revocation

Total Debt: £56,656.49
DPP Term: 8 years and 7 months
A creditor asked for the DPP to be revoked on the basis that the client was not making payments to their DPP. This was the third revocation request.
The DAS Administrator wrote to the client asking for them to provide reasonable cause for the missed payments. The client provided reasons for this but the DAS Administrator was not satisfied the DPP was sustainable and revoked the DPP.
The client asked for a review of that decision.
The client advised he had been gambling and a second job he hoped to get had not materialised. However, he was committed to paying the DPP.
The Reviewing Officer noted in the two previous revocation applications the client advised he had been gambling and asked to be afforded an opportunity to sort out his finances. The DAS Administrator had agreed to this. It was accepted that a second job would increase the client’s income but not getting this job was not a valid excuse for not paying his monthly DPP payments.
The client had only made 17 of the required 34 DPP payments.
The Reviewing Officer agreed with the original decision to revoke the DPP.

Case 12 – Approval

Total debt: £116,476.21
DPP Term: 11 years, with a discretionary condition that the client would pay a lump sum of £23k within 6 months of approval of the DPP, from an expected pension payment, reducing the term of the DPP to 8 years and 9 months.
The only creditor asked for a review of the DAS Administrator’s decision to approve the DPP.
The creditor stated the client’s declared income and expenditure was different from the information held in their records. They questioned the client’s declared expenditure as there was no provision to pay future liabilities.
The Reviewing Officer noted the CFT income and expenditure declaration was a joint husband and wife declaration. However, the client’s wife’s declared expenditure exceeded her income. The client had also declared his wife would help with future debt liabilities, but no expenditure was allowed for this in the CFT calculation.
The Reviewing Officer was not satisfied the joint expenditure declaration was an accurate declaration of the client’s expenditure liability and therefore, the client’s declared surplus income figure had not been accurately calculated.
The Reviewing Officer also noted expenditure was included in the CFT for payment of a debt that was not included in the DPP. The Reviewing Officer was not satisfied this debt could be excluded from the DPP and failure to include all of a client’s debts in the DPP proposal, was a breach of a standard condition.
The Reviewing Officer overturned the DAS Administrator’s decision and this DPP proposal was rejected.

Case 13 - Revocation

Total debt: £36,201.38
Original length of DPP: 12 years. Approved variations had increased the original term of this DPP.
The DPP was revoked by the DAS Administrator because the client had failed to comply with a discretionary condition of their DPP, to increase their DPP contribution amount six months following an approved variation reducing the DPP payment amount.
The client asked for a review of the DAS Administrator’s decision to revoke their DPP.
The client advised they could increase their DPP payment amount but not to the amount required under the discretionary condition.
The Reviewing Officer recalculated the term of the DPP based on the new contribution amount offered by the client. The DPP would run for an additional 15 years and five months. The DPP had already been in place for nine years.
The Reviewing Officer did not consider the proposed new terms of the DPP was fair and reasonable for the client’s creditors, and the client had also failed to comply with the discretionary condition of their DPP.
The Reviewing Officer upheld the decision to revoke this DPP.

Case 14 – Variation

Total Debt: £76,727.62
Term of DPP: 9 years and 9 months
The DAS Administrator approved a variation to this DPP, allowing another debt to be included in the DPP.
A creditor asked for a review of this variation on the grounds they did not believe the new debt was a contingent debt and therefore, should not be included in the DPP.
The Reviewing Officer established the debt added by the variation only became due in the tax year after the live date of the DPP. Therefore, the debt was a continuing liability and not a contingent debt, and couldn’t be included in the DPP.
The Reviewing Officer overturned the DAS Administrator’s decision and the variation was rejected.

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DAS reviews

DAS review summaries - Quarter 1 - 2021/2022