Not upheld: unfair credit relationship; alleged breach of Timeshare Regulations Regulation 14(3); inadequate provision of information complaint against Shawbrook Bank Limited

Decision detail

Summary

Mrs P complained that Shawbrook Bank Limited was party to an unfair credit relationship when it financed her purchase of Fractional Club membership (a regulated timeshare product with an investment element) for £15,198 in May 2017. She alleged the Supplier breached Regulation 14(3) of the Timeshare Regulations by marketing the product as an investment, and that she would not have purchased it without this investment element. The ombudsman found that while a breach of Regulation 14(3) was possible, Mrs P's statement claiming the investment element motivated her purchase was unreliable because it was provided after a 2023 judgment establishing this as a key factor in similar cases, and her account paralleled multiple other complaints from her PR, suggesting potential influence by knowledge of that judgment. Without being persuaded the investment element actually motivated her purchase, the ombudsman could not find the credit relationship unfair and rejected the complaint.

The Ombudsman's reasoning

The ombudsman acknowledged that while it was possible the Supplier breached Regulation 14(3) by marketing the product as an investment, regulatory breaches do not automatically render a credit relationship unfair under Section 140A. The key issue was whether such a breach actually motivated Mrs P's purchase decision. The ombudsman found Mrs P's statement unreliable because it was provided after the Shawbrook & BPF v FOS judgment, which established that marketing as an investment and this being a motivating factor were key to finding unfairness. The ombudsman noted that Mrs P's account contained language and themes (e.g., 'sounded like a great deal', would not have purchased without investment element) that paralleled multiple other accounts submitted by the same PR, suggesting the recollections may have been influenced by knowledge of the judgment rather than representing her true experience at the Time of Sale. Without being persuaded that the investment element actually motivated her purchase, the ombudsman could not find the credit relationship unfair even if a regulatory breach had occurred.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website