Cabot Credit Management Group Limited · DRN-6154387

The complaint Mr P complains that Cabot Credit Management Group Limited trading as Cabot Financial (Europe) Limited (CCMGL) breached regulatory rules when they purchased his account from the original lender. What happened Mr P’s complaint centres around a credit card account. He made a complaint to the original lender (OL) that the account had been lent to him irresponsibly, this complaint was dealt with separately to this one by our service. The complaint was upheld and OL was directed to contact Mr P to set up a payment plan. OL sold the account as part of a package of accounts to a debt purchaser (DP), that is part of the Cabot group of companies and CCMGL were appointed as the regulated firm to service the account. CCMGL appointed a debt collection company (DC) to administer the account on their behalf. DC contacted Mr P to initiate collection of the debt. Mr P complained to DC saying the debt shouldn’t have been sold. DC passed the complaint on to CCMGL to deal with. Unhappy with their response he asked our service to look into things. Separately OL confirmed they had sold the account in error and arranged to purchase it back. CCMGL didn’t uphold Mr P’s complaint to them. Mr P’s main complaint points: - The debt should never have been sold on by the OL and CCMGL didn’t carry out due diligence before the purchase took place if they had they would have known there was a dispute in place and wouldn’t have bought it - The result of them purchasing it meant they were now incorrectly reporting information to his credit file - By passing the account to DC CCMGL were in breach of data protection Our investigator didn’t think CCMGL had done anything wrong and so didn’t uphold Mr P’s complaint. Mr P disagreed and so the matter has been passed to me to decide. What I’ve decided – and why I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. I realise that I’ve summarised this complaint in less detail than the parties and I’ve done so using my own words. I’ve concentrated on what I consider to be the key issues. The rules that govern this service allow me to do so. If I’ve not reflected something that’s been said in this decision, it’s not because I didn’t see it, it’s because I didn’t deem it relevant to the crux of the complaint. This isn’t intended as a discourtesy to either party, but merely to reflect my

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informal role in deciding what a fair and reasonable outcome is. When bringing his complaint Mr P has mentioned various rules set out by the regulator – the Financial Conduct Authority (FCA). Including DISP, CONC and consumer duty. I want to confirm that in deciding this case I have taken into account all of the relevant laws, rules and regulations as well as good industry practice. However, I may not quote from them directly and I won’t necessarily quote the specific rules Mr P has quoted as I haven’t been able to locate some of the quotes Mr P has made from within those rules, for example: Mr P provided this in his recent submission: CONC 7-DISP Rule 1. Due Diligence Requirements for Debt Purchasers Before purchasing a debt portfolio, a firm must perform robust due diligence to ensure customers are treated fairly and that the data being acquired is accurate. CONC and DISP are two different sets of rules. The DISP rules are the overarching rules that our service operates under. CONC is the Consumer Credit Sourcebook which is the regulatory rules that are set by the FCA for regulated firms providing credit and debt collection to follow. Neither CONC nor DISP contain the wording Mr P has quoted above. Sale/purchase of the debt and due diligence The sale of the debt is the responsibility of OL. So, I won’t go into that further here, but I will look at the purchase of the debt. When a debt purchaser buys a debt, they normally buy multiple accounts at the same time, this is often referred to as a book of debts. It isn’t normally the case that they are provided with all the information or records the OL holds about each account. It is more common they are provided with things such as the original account number the outstanding balance and the details of the debtor – in this case Mr P. There isn’t a requirement for them to carry out full due diligence before the book is bought on each individual account, but rather they are entitled to buy the debt in good faith relying on what OL says about it being valid, owing and free from dispute. So, I’m not persuaded CCMGL needed to do anything more than they did here in terms of checking the account at the time of, or prior to its purchase from OL. Once the debt had been purchased CCMGL appointed DC to administer the account, this isn’t unusual and there were entitled to do this as they were now in control of the account. So, I don’t consider they breached any privacy rules or data protection in doing this. Reporting of the account to the credit reference agencies (CRAs) Mr P has argued the sale of his account has led to incorrect reporting to the CRAs. In that it showed him as owing money to CCMGL rather than OL. But this is how I would expect the account to be reported once the ownership of it had changed. I say this because once the account had been sold, OL were no longer responsible for reporting the status of the account to the CRAs as the debt was no longer owed to them – this moved to be CCMGL’s responsibility. CCMGL had an obligation to make sure they were reporting a true and accurate reflection of the account status – this includes that the debt was owed to them and not OL. So, I’m satisfied they didn’t do anything wrong in reporting the account in the way they did while they were the debt servicers. I appreciate that OL has since said they are in the process of buying the account back from

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DP and once this is completed Mr P should see that his credit file reflects the money is now owed to OL again. But I should warn him credit files can take a number of weeks to update. How CCMGL acted once Mr P raised his dispute Mr P originally raised his concerns with DC, who passed the information back to CCMGL. As soon as CCMGL were aware of Mr P’s concerns they placed a hold on the account and raised a query with OL. This is what I would expect to happen. CCMGL waited for a response from OL – which as we know was that they had sold the account in error and would buy it back – before taking any further action. This is in line with CONC - specifically: CONC7.14.1 (1) A firm must suspend any steps it takes or its agent takes in the recovery of a debt from a customer where the customer disputes the debt on valid grounds or what may be valid grounds. And: CONC 7.14.16 ‘Where a customer disputes a debt and the firm seeking to recover the debt is not the lender or the owner, the firm must: (1) pass the information provided by the customer to the lender or the owner;’ Bringing all of this together, I’m satisfied that CCMGL have treated Mr P fairly and reasonably when dealing with his account. Finally, Mr P has mentioned the Consumer Duty, he hasn’t been specific in saying how he thinks CCMGL may have breached this, so I have thought about it in the round and even when doing so I have seen nothing that gives me cause for concern or that would change the outcome of this case. I realise this is not the outcome Mr P was hoping for and I accept that this will be disappointing for him, but my decision ends what we – in trying to resolve his dispute with CCMGL – can do for him. My final decision For the reasons set out above, my final decision is that I do not uphold this complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr P to accept or reject my decision before 21 April 2026. Amber Mortimer Ombudsman

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