Not upheld: irresponsible lending and mis-selling complaint against SECURE TRUST BANK PUBLIC LIMITED COMPANY (trading as Moneyway)

Decision detail

Summary

Mr S complained that Secure Trust irresponsibly lent to him and misled him about a hire purchase agreement for a car entered into in January 2020 with total repayment of £45,359.60. He claimed he was vulnerable due to undiagnosed illness, was living in rented accommodation (not with parents as Secure Trust assumed), had significant council tax arrears and universal credit income, and was provided misleading information about the agreement. Secure Trust verified his income through a payslip and conducted a credit search showing he was managing his credit, but did not obtain bank statements or ask about his essential expenditure. The ombudsman found that while Secure Trust ought to have asked for more information about essential expenditure, proportionate checks would likely have shown the lending was affordable, and rejected the other complaints due to insufficient evidence. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that while Secure Trust ought to have asked Mr S for more information about his essential expenditure given the significant amount of credit and sizeable monthly repayments, it was not required to obtain bank statements. The ombudsman considered what proportionate checks would likely have revealed based on the bank statements provided after the complaint. Although Mr S's bank statements showed significant financial difficulties including returned direct debits, overdraft usage, and reliance on borrowing from friends and family, the ombudsman concluded that: (1) Secure Trust had reasonably verified his income through the payslip with year-to-date figures; (2) the credit search showed he was managing his credit commitments and was not overindebted; (3) it was unlikely Mr S would have disclosed information damaging to his application; and (4) had Secure Trust asked about essential expenditure, it would likely have concluded the lending was affordable based on his declared income and credit commitments. The ombudsman also rejected claims about misleading information, multiple agreement versions, and the £300 accountancy fee, finding insufficient evidence to support these allegations.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website