Demand for answers as SSB Law clients have loan debts cancelled

Former clients of defunct claims firms have demanded answers after their debts to litigation lenders were unexpectedly wiped out.

The Gazette has seen a number of letters sent from lender Novitas Loans to individuals who took out cavity wall claims with Pure Legal and SSB Law, both of which have since shut down. These letters confirm that loans worth thousands of pounds have been ‘fully cleared’ and closed with a zero balance.

While the cancellation of loans is good news for the clients, they say they are still in the dark about why such debts hung over their heads for many years, forcing them to live in fear of debt collectors and enduring prolonged uncertainty.

Former clients say it was never explained to them when they signed up to claims – some after being approached by claims management companies at their homes – that they were committing themselves to a loan from Novitas.

Cases should have been covered by insurance, but clients have told the Gazette that they were left exposed to the loans which were taken out to pay for after-the-event insurance, surveyor reports and solicitor fees. From the moment the loan was drawn down, these individuals were liable for high interest rates being accumulated.

They have described feeling trapped in a system where solicitors, insurers and funders all stood to benefit, while clients carried the stress and financial burden of these loans. Individuals say it was never explained to them that cases were being funded through loans – let alone loans with a high interest rate. The situation was exacerbated when claims failed and in some cases people were left to cover the defence costs incurred.

The letters from Novitas do not explain who has paid these loans off and why it has taken in some cases years to remove the debt.

A spokesperson for the SSB Victims Support Group, a collection of former clients who have joined forces to share experiences and campaign for reform, said: ‘Victims have lived under the shadow of huge debts for years, only to receive sudden letters saying their loans are wiped with no explanation.

‘People are asking: Who paid? Why now? Why not before? Novitas has profited from years of interest, while families endured unbearable emotional stress.

‘On top of that, many victims were never properly told this was a loan with high interest. Funds were drawn down at the start, interest piled up for years, and Novitas profited regardless of whether the claims ever stood a chance. This is mis-selling on a massive scale. Victims deserve answers, not silence.’

Novitas Loans was approached but declined to comment. The Solicitors Regulation Authority has an ongoing investigation into the conduct of SSB Law owners and interim conditions previously imposed on key staff remain in effect pending final outcomes.

Updating its work in relation to SSB Law in July, the SRA said: ‘We recognise the continued significant distress for clients impacted in these cases, which has raised serious questions about the conduct of solicitors and law firms. Our two immediate priorities remain protecting the public and exploring all possible options for redress for affected clients.’