Not upheld: unfair credit relationship (Section 140A CCA), connected lender liability (Section 75 CCA), regulatory compliance (Timeshare Regulations, CPUTRs, RDO Code) complaint against Shawbrook Bank Limited

Decision detail

Summary

Mr R purchased a Fractional Club timeshare membership for £17,433 financed by a 12-month interest-free loan from Shawbrook Bank in June 2019. He later complained that the Supplier misrepresented the product, that Shawbrook failed to conduct proper affordability checks, that a subsidy was hidden from him, and that the sale was pressured. The ombudsman found no evidence of actionable misrepresentation, determined that Mr R had sufficient savings to afford the purchase, confirmed that the subsidy did not increase his purchase price, and concluded that even if regulatory breaches occurred, they did not render the credit relationship unfair because Mr R received the best available deal and was not motivated by investment considerations. The complaint was rejected in full.

The Ombudsman's reasoning

The ombudsman applied a balance of probabilities test and found: (1) no factual and material misrepresentation by the Supplier regarding savings or exclusivity; (2) no unfair credit relationship despite possible breach of Regulation 14(3) because Mr R was not motivated by investment considerations; (3) no regulatory duty to disclose valuation information or subsidy details; (4) the subsidy did not increase Mr R's purchase price or constitute a hidden cost; (5) Mr R received the best available deal with 0% interest and no additional charges; (6) Mr R's original statement (Statement 2) was more credible than the later amended version (Statement 1) which appeared tailored to fit the Shawbrook & BPF judgment; (7) even if regulatory breaches occurred, they did not cause material harm to Mr R or render the credit relationship unfair in practice.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website