Legal issues for the UK motor finance industry
On 24 April 2020, the UK Financial Conduct Authority published its final report on the payment protection insurance (PPI) complaints deadline.
The report:
– says the FCA’s PPI campaign has been a success;
– states firms have paid over £38bn of redress to customers; and
– brings an end to the FCA’s project work on PPI (but it will continue to monitor how firms are dealing with complaints submitted before the 29 August 2019 deadline).
Earlier today, on 24 April 2020, the UK Financial Conduct Authority published its finalised tempoary guidance to consumer credit firms dealing with customers needing COVID-19 related payment holidays under certain regulated credit and consumer hire agreements for motor finance and high-cost credit.
There’s finalised temporary guidance for motor finance, for rent-to-own, buy-now pay-later and pawnbroking and for high-cost short-term credit.
My one page summary is:
If anyone wants a pdf copy, please get in touch: russell.kelsall@TLTsolicitors.com.
On 20 April 2020, the UK Financial Conduct Authority published a new webpage setting out its expectations for wet-ink signatures in light of COVID-19 restrictions. The FCA makes it clear its rules do not require wet-ink signatures on agreements. However, firms need to make sure electronic signatures comply with the general law (see our earlier post on the Law Commission’s report on electronic signatures). The FCA reminds firms to consider the Principles for Businesses when using electronic signatures.
Earlier today, on 17 April 2020, the UK Financial Conduct Authority started consulting on temporary guidance to consumer credit firms dealing with customers needing COVID-19 related payment holidays under certain motor finance and high-cost regulated credit and consumer hire agreements.
There’s draft guidance for motor finance, for rent-to-own, buy-now, pay-later and pawnbroking and for high-cost short-term credit. There’s also a draft handbook instrument.
My one page summary is:
If you want a pdf copy, please get in touch: russell.kelsall@TLTsolicitors.com.
After the UK Financial Conduct Authority introduced temporary guidance to consumer credit firms dealing with certain customers needing COVID-19 related payment holidays on 14 April 2020 (for more, see our earlier post), I’ve produced a one page summary of tips for consumer communications:
If you want a pdf copy of it, please get in touch: russell.kelsall@TLTsolicitors.com.
On 9 April 2020, the High Court handed down judgment in Silvercloud Finance Solutions Limited t/a Broadscope Finance v High Street Solicitors Limited [2020] EWHC 878 (Comm).
Financial services practitioners will be pleased to see His Honour Judge Pearce did not accept the Defendant’s argument that “the Financial Services and Markets Act 2000 renders every “appointed representative” in the position of the Claimant as an agent for the purpose of the law of contract when contracting with potential clients”.
This was because:
– the “word “agent‘ is not used in that Act, nor is any such unqualified modification of contractual status asserted in Section 1 of the Act”; and
– of the Court’s earlier decisions in R (TenetConnect Services Limited) v Financial Ombudsman [2018] EWHC 459 and Ovcharneko v Investuk Limited [2017] EWHC 2114 (both of which decided the statutory scheme in Section 1 is to create an additional liability on the part of the ‘principal’ “without more generally affecting the rights and obligations of third parties”).
On 15 April 2020, the UK Advertising Standards Authority (the ASA) published a decision involving aa televsion advert aimed at business borrowers which failed to say a personal guarantee may be necessary.
The ASA banned the advert saying it “disagreed with Funding Circle that it was not necessary to flag it in the ad as a possibility to applicants” and “the possibility that a personal guarantee would be required in a business loan was material information that needed to be stated in an ad”.
On 14 April 2020, the UK Financial Conduct Authority’s guidance for consumer credit firms dealing with customers needing COVID-19 related payment holidays under certain regulated credit came into force.
There’s guidance for credit cards (including retail revolving credit), personal loans (but there are a number of exclusions including motor finance) and overdrafts.
My one page summary of the guidance is:
