Not upheld: Irresponsible lending complaint against ACI-UK LIMITED

Decision detail

Summary

Miss A complained that ACI-UK Limited irresponsibly lent a loan (originally from company M) and engaged in deceptive practices. The loan was taken out in February 2020 for £1,475, M went into administration, and ACI took over servicing the account. Miss A raised concerns about irresponsible lending, the provision of the credit agreement, and credit file reporting. The ombudsman found ACI not responsible for the original lending decision as they did not originate the loan and lack access to the original lender's information and criteria. While likely failing to reply to an April 2022 complaint email, this caused no detriment given Miss A's incorrect understanding of FOS procedures. The ombudsman determined ACI's offer to reduce the outstanding balance to £1,475 was fair and reasonable, as any errors regarding the credit agreement would not exceed this reduction amount.

The Ombudsman's reasoning

The ombudsman found that ACI are not responsible for the original lender M's actions when taking over the account, and therefore cannot be held liable for irresponsible lending. An irresponsible lending assessment requires detailed understanding of the borrower's circumstances and the original lender's criteria, which ACI did not have access to. While there is uncertainty about whether ACI received and failed to reply to an April 2022 email, the ombudsman found no detriment resulted because Miss A's own understanding of FOS procedures was incorrect. Regarding the credit agreement, even if ACI made errors in providing it, those errors would not exceed the £294.26 reduction already offered. Credit file reporting of accurate information is permitted even during disputes, and default markers are expected to remain for six years from the default date.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website