Not upheld: defaulting of accounts during forbearance arrangement; alleged breach of Consumer Duty and vulnerable customer protections complaint against Capital One (Europe) plc

Decision detail

Summary

Mr S complained that Capital One (Europe) plc wrongfully defaulted his two credit card accounts after he disclosed physical and mental health conditions and fell into arrears. Capital One had offered a breathing space arrangement pausing interest and charges, but Mr S argued the subsequent defaults breached its Consumer Duty and vulnerable customer obligations. The ombudsman found Capital One was entitled to default the accounts because it provided multiple clear notices that defaults could occur during breathing space, defaulted after six months of arrears in line with ICO guidance, and was obliged to maintain accurate credit file information reflecting payment history. The complaint was not upheld and no remedy was ordered.

The Ombudsman's reasoning

The ombudsman found that Capital One was entitled to default the accounts because: (1) it provided multiple clear notices that accounts could default during breathing space (web chat, email, letters, default notices); (2) defaulting after six months of arrears complies with ICO guidance; (3) maintaining accurate credit file information is a regulatory obligation that applies even to vulnerable customers; (4) breathing space was itself a fair forbearance measure; and (5) Mr S received reasonable notice through multiple communications before defaults were recorded.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website