In an unguarded moment, at a rare meeting with my late ex-husband’s trustee in bankruptcy, he agreed that my situation was, in part, the fault of the bank. I had questioned why I was in the position of having to pay him with MY property when I had never even seen a personal guarantee, let alone signed it or benefitted from it.
‘That is your husband’s fault.’
‘…and the bank’s,’ I said.
‘Yes, and the bank’s,’ he agreed in a split second of candour. That’s when I asked him why he had blocked any investigation by the Financial Ombudsman of the bank’s role. He checked himself and stuttered to his sidekick, who was meant to be recording the conversation, ‘Oh…er… Sam, don’t write that... put something else.’ Falsifying records of a meeting.
In my long campaign against personal guarantees, I have come up against those who genuinely can see no wrong in holding a family to ransom over their home. This is usually because they assume, incorrectly, that the family benefitted from the money. They deem it acceptable to make families liable for business dealings with which they probably had no congress and no influence. In fact, they never question a bank’s right to lend money to a business based only on the value of someone else’s home. This is madness.
I have also come across professionals who make excuses, lie and cover up for this practice which allows banks to put meaningless numbers in a business customer’s account and collect many times over in real terms, including forcing the sale of the family home. Some of these are people in authority who should be protecting vulnerable members of society.
The fact is that lending on the basis of personal guarantees is open to abuse. Banks have taken advantage of a frankly appalling precedent which allows them to demand immediate payment of borrowing and to call on a guarantor within a few hours, without recourse to the business borrower. Banks (and the Bank of England) now see a guarantor and their family home as a primary source of funds. I wouldn’t be surprised if it is government policy. Which is surprising given that 80% of the value of most smallbiz nowadays is intangible and can be captured as £ in intellectual capital guarantees. There is absolutely no need to evict families.
In my case, as with many others I know about, a call on a guarantor invariably leads to family breakup, loss of home and financial stability, mental ill-health and suicide. The awful impact cannot be overstated. I might add that it is also bad for business - clearly these people don’t bounce back. So much lost £ in intellectual capital. So many businesses gone.
That is the situation in which I found myself, in 2009. I faced bank customer services who lied and dissembled. I found myself pushed into the ring with an insolvency practitioner and his legal henchmen. I faced a phalanx of financial regulators who are set up to avoid questioning the practice of personal guarantees. I also encountered legal disinterest because legal precedent has been unfairly weighted for so long on the side of banks and their limitless resources.
I battled with insomnia. I was terrified, day and night, of people arriving at my home. I attempted to discuss things at a distance with my husband, who had buried himself in France, in the grip of severe anxiety and depression. I tried to save my marriage and keep my family together. To no avail. I was advised to divorce.
I had to find another job to pay the mortgage and eventually secured a good position in the Environment Agency in my capacity as a Landscape Architect/environmental assessor. I was very lucky to get the job at my age, even though I was over-qualified for it. But I hated that place, possibly because I was severely depressed myself, having been through a divorce I didn’t really want and by that time unable to afford heating or basic groceries. In the end, after getting fed up with the travelling involved and the almost military personnel at the EA office, I looked in the local papers and landed a job as a teaching assistant in a village primary school.
It is not an easy job. It is physically and mentally demanding. It requires a lot of skill and expertise. It is also extremely poorly paid. I don’t think I was a particularly good TA.
What really helped me through those times was going into a place where everything is immediate – you cannot dwell on what is going on outside the class. Children usually buzz into a classroom in the morning – most with bright faces and something riotously joyful going on in their lives such as an anticipated playdate. Others need lots of care. Staff are professional and courteous, usually. I told the headteacher what was going on in my life with regards to my home, and she was utterly supportive. Staff sat with me when, having been bullied and threatened by the bankruptcy trustee’s lawyers in a legal stand-off, I sobbed over a small desk in the school office after being forced to sign away my home.
From that school, I trained as a teacher and then moved to another local primary school. There, another head teacher was totally supportive, calling on his friends with legal backgrounds to go through any options with me. There was nothing they could do, however, in the face of financial power.
These people with their care, and these children by their sheer presence, got me through the blackest of times. Just. They were there for me when my husband died and they were ready 6 months later when intense grief returned with a vengeance and threatened my mental stability.
I should also mention Cruse Bereavement counsellors, and NHS mental health counsellors who helped me to cope. Even Action Fraud, although seemingly impotent in these cases, sent a Victim counsellor.
But I still felt the need to tell my story openly. I felt as if I had been silenced.
I decided to explore twitter. My first discovery was Mr Ethical. He was giving detailed information about what had happened with overcharging on store cards linked to HSBC. I read Shredded by Ian Fraser. I began to understand that banks really are up to no good and that the ‘Goodwin era’ of banking cost many people their homes and livelihoods. Most importantly, I discovered a large, diverse community of small business owners who had their homes, families and livelihoods taken away from them to support banks. I was not alone.
Now, it may not be advisable to agree to meet someone you have encountered on a social media site, but I put all safeguards in place and went to meet www.diylaw.co - and Jeff Lampert, who eventually became my #evictionbuddy. We discussed what makes the individuals in a bank behave in a way which harms ordinary customers. #PGwidow came into being.
I discovered that Jeff’s case in 1998-99 was a catalyst for the abuse of personal guarantees. diyLaw has since worked to expose the abuses and to find a solution for people like ourselves – we believe there are thousands. A dispute resolution process was devised by diyLaw to address cases where people have been evicted unnecessarily. Although they will never get their homes back, the aim is to return them to the financial position they should not have been denied. Jeff knew that there had been perjury in his case but the authorities wouldn’t release the information. A solution was eventually provided by Action Fraud in 2020 with a note saying that Jeff’s case was sent to the police to record as perjury.
13 years on, I feel that I am on the way to being a survivor of a most horrific financial ill. I will know I have done some good in the world when PG evictees are routinely reimbursed for the loss of their home and when lenders look to the capital in a business (intellectual capital) to repay a business loan and NOT an unsuspecting family.
Jane Farmer
June 2021
