Not upheld: Fairness of fees and charges; variation of contract terms complaint against Assetz SME Capital Limited

Decision detail

Summary

Mr C complained about Assetz's introduction of a £1 Withdrawal Fee and £35 ISA Transfer Fee following the announcement of the platform's solvent wind-down in December 2022. Assetz relied on variation clauses in its terms and conditions that reserved the right to introduce fees based on costs related to providing the service. The ombudsman found that while the variation clauses had some fairness concerns regarding specificity, they were sufficiently limited by the cost-based requirement. The ombudsman was satisfied that Assetz had fairly communicated the fees, that the fee amounts reflected actual costs incurred (including third-party processing costs), and that investors had options to mitigate the impact, such as waiting for loan repayments or using the flexible IFISA feature. The ombudsman concluded that the fees were necessary to support the solvent wind-down and were fair and reasonable in the circumstances, and therefore did not uphold the complaint.

The Ombudsman's reasoning

The ombudsman found that while the variation clauses had some fairness concerns (lack of specificity regarding timing and amount), they were limited by the requirement that fees be based on costs related to providing the service. The ombudsman was satisfied that Assetz had carefully considered the impact on investors and fairly weighed alternatives, such as increasing the Lender Fee. The ombudsman found that Assetz's cost calculations were supported by evidence and that the fees reflected actual costs incurred. The ombudsman acknowledged concerns about how Assetz apportioned third-party costs on a per-transaction basis when those costs were based on a flat fee, but found that current transaction volumes meant the true cost per transaction was higher than £35, so Mr C was not being financially disadvantaged. The ombudsman concluded that investors had options to mitigate the impact of the fees, including waiting for loan repayments, making multiple transfers, or using the flexible IFISA feature.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website