Partially upheld: unfair credit relationship under Section 140A of the Consumer Credit Act 1974; breach of Regulation 14(3) of the Timeshare, Holiday Products, Resale and Exchange Contract Regulations 2010; connected lender liability under Section 75 of the Consumer Credit Act 1974 complaint against Shawbrook Bank Limited
Financial Ombudsman decision DRN-6380430 of 2026-05-22T00:00:00+00:00. unfair credit relationship under Section 140A of the Consumer Credit Act 1974; breach of Regulation 14(3) of the Timeshare, Holiday Products, Resale and Exchange Contract Regulations 2010; connected lender liability under Section 75 of the Consumer Credit Act 1974 complaint against Shawbrook Bank Limited. Outcome: Partially upheld.
Decision detail
| Reference | DRN-6380430 |
|---|---|
| Decision date | 2026-05-22T00:00:00+00:00 |
| Firm | Shawbrook Bank Limited |
| Product | loan |
| Claim type | unfair credit relationship under Section 140A of the Consumer Credit Act 1974; breach of Regulation 14(3) of the Timeshare, Holiday Products, Resale and Exchange Contract Regulations 2010; connected lender liability under Section 75 of the Consumer Credit Act 1974 |
| Outcome | Partially upheld |
| Remedy | In relation to the 2014 purchase: (1) Refund all repayments under Credit Agreement 2 including settlement sums and cancel any outstanding balance; reimburse amounts paid by other means; (2) Deduct value of promotional giveaways and 32% of Wish to Rent rental receipts and commissions; (3) Add simple interest at 8% per annum to Net Repayments from date each payment was made until settlement; (4) Remove adverse credit file information relating to Credit Agreement 2 within six years of the decision; (5) Provide indemnity against ongoing liabilities for Fractional Club points if Mrs S agrees to assign or hold them on trust for the Lender. |
Summary
Mrs S and her late husband's estate complained to Shawbrook Bank Limited about three timeshare-financed loans taken out between 2013 and 2018, alleging misrepresentations by the Supplier and unfair credit relationships. The ombudsman found the 2013 purchase complaint was time-barred under the Limitation Act 1980 and out of FOS jurisdiction. The ombudsman upheld the complaint regarding the 2014 purchase, finding the Supplier breached Regulation 14(3) of the Timeshare Regulations by marketing Fractional Club membership as an investment, which materially influenced Mrs S's purchase decision and rendered the credit relationship unfair under Section 140A of the Consumer Credit Act 1974. The ombudsman rejected the 2018 purchase complaint due to insufficient evidence of misrepresentation or unfairness, though noting the Lender should have conducted more thorough affordability checks given Mrs S's high annual management fees. The Lender agreed to settle in accordance with the ombudsman's recommendations, which included refunding repayments under Credit Agreement 2, deducting benefits received, adding interest, and providing an indemnity against ongoing liabilities.
The Ombudsman's reasoning
The ombudsman found that the Supplier breached Regulation 14(3) of the Timeshare Regulations by marketing and selling the 2014 Fractional Club purchase as an investment. The ombudsman concluded that the prospect of financial gain from the share in the Allocated Property was the only realistic selling point for Mrs S, and that this breach materially influenced her decision to purchase. The ombudsman weighed Mrs S's testimony against contractual disclaimers, considering that the full story of a purchase is not always told by written records alone. The ombudsman found this breach rendered the credit relationship under Credit Agreement 2 unfair to Mrs S under Section 140A of the Consumer Credit Act 1974. For the 2013 purchase, the complaint was time-barred under the Limitation Act 1980 for Section 75 claims and out of jurisdiction under FOS rules for Section 140A claims. For the 2018 purchase, there was insufficient evidence of misrepresentation or unfairness, and while the Lender should have carried out more checks, there was no evidence the loan was actually unaffordable.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Shawbrook Bank Limited, all decisions | 2,486 | 17% |
Source
Read the original decision on the Financial Ombudsman Service website