Couple sentenced for fraudulent service

By on 18/09/2012 in News

A couple who fraudulently claimed they could clear people's debts, have been sentenced at Birmingham Crown Court yesterday (September 17).

Basil Rankine, 46 and his wife Amanda, 36 of Somerset Avenue, Rugeley in Staffordshire, set up Credit Card Killer (CCK), a trading name of Momentum Network Limited. According to their website, CCK was “a specialist company that purchases debt directly from consumers and commercial companies”. They claimed to “help thousands of sellers to clear their debts in just two weeks.”

Following a seven week trial, the pair and their company were convicted of a total of 14 offences including fraud after providing misleading and false information both on their website, through their agents and in correspondence with clients. Mr Rankine was sentenced to four years imprisonment and Mrs Rankine was given a 12 month suspended sentence plus 200 hours of unpaid work.

The investigation into Credit Card Killer and the Rankines was led by the England Illegal Money Lending Team, which is hosted by Birmingham City Council. The Team has specialist knowledge of the Consumer Credit Act. The prosecution was supported by the Office of Fair Trading and the case was conducted in Court by Counsel Richard Barraclough QC and Lee Bennett of 6 Pump Court, Temple, London.

CCK contacted Birmingham City Council and were warned that the service they provided didn't comply with the law. They failed to ever provide a through explanation of what their business involved but gave this description on their website;

“CCK was developed in 2004 as a trading name of Momentum Network Limited. The company was formed by Basil and Amanda Rankine, pioneers of the recently established debt cancellation industry. The Rankines made history by challenging credit agreements with their lenders and successfully cleared in excess of £100,000 worth of debt. Inspired by their success CCK was launched to champion the voice of debtors”.

The company claimed they could buy people's debts from them for the sum of £1, Following which the debt would transfer to CCK and the borrower would no longer be liable for the debt. However this so called debt sale was done without the consent of the lender, and as was highlighted in a High Court case by His Honour Judge Simon Brown QC was “legally and factually flawed”.

Once it became apparent, that Basil and Amanda were continuing to operate the business, a warrant was executed at their business at Baskerville House, Birmingham City Centre. A large quantity of material, including computers and correspondence between lenders and debtors was seized as evidence.

On behalf of the Prosecution, Richard Barraclough QC told the Court how it became apparent that the business was having a collective impact on consumers, many of whom who had been convinced to sell their debts to CCK after visiting its website or watching a BBC Panorama programme called 'Can't Pay Won't Pay' in which the Rankines featured.

Each of those who sold their debts paid between £800 and £18,000 in administration and other fees. They generally received a letter from CCK to confirm that CCK was then liable for the debts, and the lenders were also sent a letter from CCK to state that the debts had been bought by them.

As debts can't legally be sold without the consent of the lender, the lenders continued to contact and pursue the borrowers for payment of their debts. As late payment charges added up, borrowers fell deeper into arrears, some had their bank accounts frozen, some had legal action taken against them and others had charging orders registered against their homes.

When they contacted CCK for advice, little help was given to them; requests for refunds were refused. Mr Rankine was said to have become aggressive and intimidating when people questioned why they weren't allowed refunds.

Many paid for a further service offered by CCK known as 'Total Protection'. CCK claimed that 'Total Protection' would allow their Solicitors to contact lenders, and prevent them from pursuing borrowers. However those who paid for this so called service were still continually contacted by the lenders.

The borrowers believed that by taking out 'Total Protection', their credit history would not be adversely affected. However their credit reports continued to show the late payments even after they had “sold on” their debt. This adverse credit history affected the employment of some as well as their chances of being able to obtain credit in the future.

CCK was at one point a large enterprise, saying that it had offices in Birmingham and London, employing around 70 agents to encourage people to sell their debts. The agents were trained by the Rankines and given standard responses to give if borrowers questioned why they were still being chased by their lenders.

There were over 2000 clients and the company was thought to be making in excess of £2million through fees and charges.

In July 2009, CCK claimed that they had purchased more than £10million of consumer debt.

Upon sentencing His Honour Judge Tomlinson commended those involved with the case and said “The real harm and loss in this case was human, affecting the pride and self respect of many decent victims. The harm done to these people was much greater than financial, they continued to be pursued by lenders and had no idea how stressful this would be.”

He added “There was no secret formula. The business had no legitimacy whatsoever. Even after a high court judge had told them they simply could not do what they had been doing, they continued.”

Councillor Barbara Dring, Chairman of the Licensing and Public Protection Committee at Birmingham City Council, which oversees the England Illegal Money Lending Team, said: “It is hugely pleasing to see justice being served as a result of the hard work of the agencies involved. Through the unscrupulous methods used by Credit Card Killers consumers were made to pay large amounts of money for a service that couldn't be provided. We would urge anyone in financial difficulty to seek debt advice.”

Jacqui Kennedy Director of Regulatory Services at Birmingham City Council said “Today's impressive result sends a clear message that businesses such as these which rip of consumers will not be tolerated. No matter how slick and professional a company might appear the consumer must realise that debts cannot legally be bought and transferred without the consent of the lender, and so be aware of any companies which offer this service, and report them to trading standards.”

Gordon Ramsay, Deputy Director at OFT, said: 'Don't be caught out, if you are struggling with debts contact one of the many free advice agencies for help as soon as you can.'

If you are concerned about a bogus 'debt sale' company call Consumer Direct for advice on 08454 04 05 06 or visit www.consumerdirect.gov.uk

Ends

Sarah-Jane Lynch - Communications Officer
Illegal Money Lending Team - Trading Standards

Telephone: 0121 693 1030 or 07881617119
E-mail:  sarah-jayne.lynch@birmingham.gov.uk

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